USDA not expected to sell sugar under FFP during fiscal 2015

By Erin Voegele | September 17, 2014

In early September, the USDA’s Commodity Credit Corp. announced it does not expect to purchase sugar under the Feedstock Flexibility Program in fiscal year 2015.

The FFP was created by the Farm Bill. Under the program, USDA is required to purchase sugar and sell it on a competitive basis as feedstock for bioenergy producers in order to avoid forfeiture of sugar pledged as collateral by processors when securing certain loans from the CCC. Sugar sold under the program must be used to produce ethanol or other marketable biofuels.

The USDA’s announcement references a recent World Agricultural Supply and Demand Estimates report that projects a domestic fiscal year 2015 ending sugar stocks-to-use ratio of 6.9 percent. According to the USDA, it has determined that sugar loan collateral forfeitures are unlikely.

While the FFP was created in the 2008 Farm Bill, 2013 was the first year in which the USDA offered sugar for sale to bioenergy producers under the program. FrontRange Energy, Buffalo Lake Advanced Biofuels, Central Indiana Ethanol, Pacific Ethanol Holding Co., and Aventine Renewable Energy Inc. were among the ethanol producers that purchased sugar under the program.