A&B sugar
unit ordered to
expedite exports

The move to combat
declining prices will take a big
portion of C&H's product
out of the market

Bloomberg News

WASHINGTON -- California & Hawaiian Sugar Co., which is operated and partly owned by Alexander & Baldwin Inc., was ordered by the U.S. Agriculture Department to re-export sugar more quickly because extra imports could be depressing U.S. sugar prices.

The department's Foreign Agriculture Service cut the re-export period granted to C&H Sugar on 100,000 tons of sugar to 180 days from five years.

C&H, based in Crockett, Calif., won permission to import 50,000 tons of sugar on Oct. 26, because the USDA hadn't yet decided import quotas for the year that began Oct. 1. Earlier, the company obtained permission to bring in 50,000 tons, to keep plants operating and workers employed.

"We're basically asking C&H Sugar Co. to take about 100,000 tons of sugar out of the market," said Steve Hammond, the department's sugar analyst.

"It's not good news" for C&H, said H. Wesley McAden, a company lobbyist, who declined further comment.

The announcement was made after markets closed today. A&B shares fell 12 cents to $22.50 in Nasdaq trading today.

Honolulu-based A&B owns 40 percent of C&H. It sold the other 60 percent interest to New York-based Citicorp Venture Capital Ltd. late last year.

Domestic sugar prices, which have hovered between 21 cents to 24 cents a pound for the last decade, began dropping in July and fell to 17.60 cents on Nov. 30, the lowest in at least a decade. "The domestic industry has produced a lot of sugar this year, and that's most of what you are seeing," Hammond said.