The following is an excerpt from an American Sugar Alliance issue brief on wholesale sugar prices in the U.S. To review the issue brief in its entirety, visit www.sugaralliance.org.

One day after Valentine’s Day 2007—the biggest boxed chocolate sales day of the year—Hershey Co. delivered a bitter message to 1,500 workers: “You’re fired.”

The U.S. company announced plans in a Feb. 15 press release to cut 11% of its workforce, outsource domestic production of specific products, and build a new state-of-the-art manufacturing plant in Monterrey, Mexico.

Considering the 2007 Farm Bill debate is on the horizon, it won’t take long for opponents of sugar policy to start playing the blame game. They will undoubtedly fault U.S sugar prices and use U.S. sugar policy as a scapegoat, just like they’ve done every other time a food manufacturer moved south of the border in search of cheap labor.

What the food manufacturer lobbyists will conveniently fail to mention is that sugar prices are higher in Mexico than they are in the United States.

Hershey will likely pay more for sugar in Monterrey. In January, Mexican prices averaged 34.2 cents per pound while U.S. prices were 25.5 cents.

The finger pointers will also conveniently overlook the fact that wholesale sugar prices in America have steadily declined for food manufacturers like Hershey over the past quarter century.

In fact, U.S. sugar prices have fallen by 35% since 1980. Candy prices, on the other hand, have shot up by 62% since 1980. Clearly, food manufacturers pocket the savings instead of passing them along to consumers in the form of cheaper products.

Hershey executives with knowledge of the recently announced move will not be the ones blaming U.S. sugar prices, mind you. That job belongs to their trade association’s spin machine. Hershey will likely be honest about the motivating factors—just like other manufacturers who have left the United States.

Julie Daniels, a spokesperson for Brach’s Confections Inc., told the Associated Press on Feb. 15, 2006, that their decision to shift some of their U.S. operations to Mexico “was based on lots of factors and could not be pinned specifically on sugar pricing.”

“The overriding reason for relocation is reduced labor costs and related benefits,” according to Peter Buzzanell, a former USDA official who studied relocations in the confectionery industry.

It is unfortunate that the handful of sugar policy opponents will use this recent tragic loss of American jobs as a “news hook” to serve their purposes, even though the truth is plain to see.

U.S. sugar policy has kept prices affordable and should be renewed by Congress.