Preferential trade has been essential for countries seeking access to major sugar-importing countries. Several key countries using tariff rate quotas (TRQs) and preferential trade agreements give access to their sugar markets, giving their counterparts a competitive advantage over other sugar exporting countries. The EU-27 and the US are two key import markets for sugar – typically importing 2.2 mln tonnes and 3.1 mln tonnes of sugar (average 2021-2023), together representing 8% of world sugar imports. Each use TRQs to manage imports, both under WTO commitments and under regional or bilateral free trade agreements, and under other preferential trading arrangements. Many sugar-exporting countries, especially African Caribbean and Pacific (ACP) nations and Least Developed Countries (LDCs), heavily rely on preferential access to the EU and US, amongst other markets. Without preferential access, some sugar exporting countries would struggle to compete in the global sugar market.

 The objective of this paper is to investigate import flows and quota systems in the EU and US, which represent the most important preferential markets. Higher bilateral access has reduced the importance of broader TRQ programmes which changes trade preferences for exporters. Key sugar policy reform in the EU since 2006/07, culminating with the abolition of production quotas in October 2017, has seen a significant erosion of the price preferences once assured to ACP/LDC countries, as well as shrinking import needs. With Brexit effective since January 2021, the EU-27 and UK compete for ACP/LDC sugar, although the UK’s autonomous tariff quota satisfies most import requirements. The role of the US in global sugar trade will be maintained and is unlikely to change whilst the sugar programme and associated sugar trade settings and concessions are in place. However, any efforts to reduce or eliminate key aspects of the US sugar programme would likely lead to a greater reliance on imports and a more competitive domestic market. In this respect, the US may increase its reliance on sugar from Brazil or other top producers such as Australia, potentially altering existing trade patterns.

Contents:

Introduction										 

Part 1: United States									  
1. Market Access										  
     1.1 Sugar TRQ programmes								  
	  a. The WTO Raw Sugar TRQ							  
	  b. Raw Sugar TRQ Reallocations and Additional Quantities		  
          c. WTO Refined Sugar TRQ							
          d. Entries under FTAs and Bilateral arrangements			
     1.2 Import Tariffs										
     1.3 The Special Case of Mexico							
     1.4 TRQ Fill Rates										
          a. WTO Raw Sugar TRQ Quota Fill						
          b. WTO Refined Sugar TRQ Quota Fill					
          c. Entries Under FTA TRQs							
	  d. High-Tier Sugar Imports							
     1.5. Trade Dynamics									

Part 2: European Union									
     2.1 Policy Reform										
     2.2 Brexit and Sugar 									
     2.3. TRQs											
           a. WTO CXL Quota								
           b. Balkan Quota									
           c. FTAs										
     2.4 Duty-Free Quota-Free Access for ACP and LDC Countries			
     2.5 Price Dynamics And Quota Fill 							
          a. Ukraine										
          b. EPA/EBA Imports (duty free-quota free)	`			
          c. CXL/Balkan quota Fill Rate							
          d. FTA – Calendar Year Imports						
     2.6 Trade Dynamics									
     2.7 Future Trade Agreements								

Conclusions											

Appendix A: Tranches for Speciality Sugar					
Appendix B: US Sugar TRQ entries under FTAs					
Appendix C: EU Sugar Import Licences and Allotments			
Appendix D: EU Calendar Year FTA Import Quota Fill