Sugar Beet Area Not Sweet on Pact

Crews work on a sugar beet pile near Perley, Minn., in November. A Central American trade accord has upset sugar beet growers in the Red River Valley. (Darren Gibbins -- Fargo Forum Via AP)

When Germans and Scandinavians settled these parts in the 19th and 20th centuries, they found nothing but a grassy prairie. For years, wheat was the main cash crop. But in the 1950s, sugar beets were introduced in the fertile, gently tilting plain on both sides of the north-flowing Red River boundary between Minnesota and North Dakota.

Rainfall, good soil and cold winters that allowed farmers to store beets on their farms without spoilage gave growers a competitive edge. Although beets are also grown in western and other Midwestern states, the Red River Valley accounts for more than 40 percent of U.S. beet sugar production and one-fifth of all U.S. sugar output. The area's $1 billion-a-year sugar crop, produced on a half-million acres by more than 1,000 farmers, supports about 32,000 jobs year-round in processing and related services, according to the industry.

As big a business as it is, it is still family farming. Hasbargen, two sons and a brother handle 2 1/2 square miles of beets with the help of only a few hired hands. During harvest, the Hasbargens all put in 12-hour shifts day and night on the huge machines that "top" (cut off the bushy leaves of the plants) and then dig up the beets.

Underpinning the industry, however, is an elaborate federal program that protects U.S. growers from a world market glutted with cheap sugar. Quotas limit sugar imports to the United States to about 1.2 million tons a year, and the government sets the annual level of production and enforces it through acreage allotments that cooperatives hand down to individual farmers.

Although the program is supposed to operate at no cost to taxpayers, the 2002 farm bill restored a requirement that the federal government acquire surplus sugar from refiners if prices fall below a set level, now about 22 cents a pound.

Dependence on Washington has made political activists out of many beet farmers. The political arm of American Crystal Sugar, the largest Red River Valley cooperative, has poured $627,000 into congressional campaigns this cycle, more than double the amount in 2000. "There was strong support for Bush in the valley in 2000," said James Horvath, American Crystal's top official. "Right now we're not exactly sure where the administration is in regard to sugar."

To Peterson and many farmers, the Central American Free Trade Agreement (CAFTA), signed in May, is "the camel's nose under the tent," foreshadowing more concessions in trade deals with such big sugar producers as Thailand, Colombia and eventually Brazil.

"The president was committed to an understanding that sugar was different, that it was a sensitive crop," Hasbargen said. "If CAFTA is, as they said, a template, that is the end of our industry as we know it."

So far, beet growers have received little sympathy from Republican leaders in Congress. Earlier this year Anthony Reed, an aide to House Speaker J. Dennis Hastert (R-Ill.), told a delegation of Minnesota beet growers that they "should be very happy with what happened in CAFTA -- it could have been worse," according to Hastert spokesman John Feehery.

Beet farmer Victor Krabbenhoft, who chairs the 500-member Minn-Dak beet cooperative, recalls responding: "The president is trying to kill me and my industry, and in all due respect, I will not kiss the ground he walks on." Recent assurances by Vice President Cheney that trade issues should be dealt with at the World Trade Organization -- a position supported by the beet industry -- do not appear to have satisfied all growers.

Whether Kerry can capitalize on the sugar issue is uncertain, however. Although he now favors renegotiating the treaty, Kerry cast votes against the sugar program in 1996, 1999 and 2000. U.S. officials, citing the agreement's broad benefits to U.S. farmers -- and a guarantee that imports would be limited if the treaty proved damaging to the sugar industry -- stand by the agreement.

They are backed by the American Farm Bureau Federation, which estimates CAFTA will increase the value of U.S. farm exports to Central America by $900 million a year within 15 years.

"The balance we achieved was a good balance and there's no need to reopen this," said Allen F. Johnson, chief U.S. trade negotiator on agriculture.

Researcher Meg Smith contributed to this report.