Despite a promising crop, Louisiana sugar farmers are worried about the competition from Mexico

Donald Hunter gathers sugar cane at the end of a row after it has been cut down by a harvester machine at Bayou Cane Co., Inc. Friday in Sorrel. Gasoline, fertilizer and other goods that are essential to the sugar cane business have risen in price even as raw sugar prices have declined, experts say.

The 2008 sugar cane crop survived Hurricanes Gustav and Ike in September, a rare snowfall in December and a drought, but some industry watchers say rising operational costs such as fuel and sugar imports are what could hurt farmers the most.

Although this year's crop, with its high sugar content, could be a repeat of last year's respectable harvest of 13 million tons of cane that yielded 222 pounds of raw sugar per ton, farmers fear that an increase in the amount of imported Mexican sugar could drive down market prices along with profits.

Input costs for items such as gasoline and fertilizer that are essential to the sugar cane business have risen while the price of raw sugar has remained stagnant or dropped, experts say. And the amount of sugar and products containing sugar from Mexico has jumped dramatically since trade restrictions and tariffs were lifted in early 2008.

For instance, in October 2007 17,562 metric tons of imports came from Mexico, according to statistics gathered from the United States Customs and Border Protection. In October 2008, that figure was 77,184.

"Imports for Mexico and other sugar importing countries are bearing down, competing with domestic production and driving prices down," said Jim Simon, general manager of the American Sugar Cane league, a lobbying group for farmers.

One analyst estimated that 2008 input costs rose almost 20- to 30-percent over the previous year, while the price of raw sugar fell from 24 cents a pound last summer to about 20 cents or lower by the fall.

Michael Salassi, a professor of agriculture economics with the LSU AgCenter, said the biggest increase has been in fuel and fertilizer. For an average farm of 1,500 acres, the usual $1 million production price tag rose by $200,000. Fuel and fertilizer costs nearly doubled in the spring, Salassi said.

In December 2007, nitrogen, which is used to fertilize crops, cost 54 cents per pound. It rose to a $1 by the spring of 2008. Diesel, which is purchased by the truck load, rose to $20,000 from $10,000 at one point this year, he said.

Louisiana is the second-largest sugar producing state in the nation behind Florida. Louisiana farmers produce about 20 percent of the nation's sugar from both beets and sugar cane. However, the growing number of imports is a very real concern, some Louisiana farmers say.

According to federal trade figures, 629,526 metric tons of sugar were exported from Mexico to the U.S. in the fiscal year that ended in September. For the current fiscal year, Mexico imports are on pace to top a million metric tons, nearly doubling last year's figures.

Like many Louisiana sugar cane farmers, Jessie Breaux works the same land his great-grandfather farmed many years ago.

Breaux, 57, leases 2,400 acres of land in St. Mary Parish for sugar cane production. His is one of the nearly 700 such farms in 23 parishes in Louisiana that makes cane farming a $2 billion industry with a workforce numbering 27,000.

As harvesting season winds down this month, Breaux said he and many other farmers are facing the twin challenges of rising operation costs and price fluctuations and "have our belts tight."

In order to account for the losses, he said he has cut down to the bare bones, he's not purchasing equipment and reducing the amount of fertilizer he uses. He's also lowering the number of trips through the field he and his employees make with machines to cut down sugar cane.

"I'm making 12-percent less sugar than I did last year," said Breaux, who is also president of the American Sugar Cane League. "Sucrose is high, but it's still not helping me overcome my loss in tons. Everything I do has gone up."

For Leslie Rodrigue, a St. John the Baptist Parish farmer, the harvest was a little above average this year because the sucrose content was high.

The high sugar content -- a product of a mostly dry season -- did not help farmers with costs, said Rodrigue, who along with five employees harvested 900 acres in St. John.

For farmers, the secret to keeping the teetering boat afloat is to increase production to increase yield and efficiency, said Rodrigue.

Always the optimist, Breaux said the dedicated farmer's motto is: "Next year's going to be better."

"We're going to stay here and we aren't going anywhere," he said. "We're all managing our businesses as well as we can to stay alive until things get better. We deal with it one day at a time."