The Treasury Department said yesterday it opposed any immediate action designed to help U.S. sugar producers by raising prices.
Treasury officials expressed concern over the impact on consumers and world trade a proposal being of considered by the Agriculture Department to help U.S. producers by restricting sugar imports and establishing a minimum market price of raw sugar.
The Agriculture Department proposal would set a price support level of 13 to 14 cents a pound. Raw sugar yesterday sold at 10.85 cents a pound. One industry association estimates that each 1-cent increase costs American consumers $225 million a year.
A Treasury Department official said yesterday the department is concerned over the use of quotas and price supports. The official said sugar quotas have an uneven impact on sugar-exporting countries (many of them poor) and set precedents for quotas on other commodities.
Treasury also opposes taking action now while the U.S. Trade Commission considers the impact of imported sugar on U.S. producers and while a new international sugar agreement is to be negotiated soon.
With world sugar prices having swung in a roughly 55-cent-a-pound are in the past two years, the official said the Treasury Department would like a solution that sets a ceiling on prices as well as a floor.
As a result of these concerns, the official said., "We are opposed to immediately going forth on any particular program now." He said it could be that after studythe Agriculture Department proposal may prove to be the best, but time for study should be allowed.
Agriculture Secreatry Bob Bergland, a former congressman from a sugar beet district in Minnesota, may modify the proposal, and he may present some plan to the President's Economic Policy Group, which meets today. The current propoals are close to what Bergland has either ought or favored in the past.
A spokesman for Bergland, asked about the Treasury Department's concerns, emphasized the suggested quota levels and price supports are tentative and said they are among many options.