The Justice Department has filed an antitrust lawsuit to prevent United States Sugar Corp. from buying a rival processor, Imperial Sugar Co., from agribusiness giant Louis Dreyfus Co.
The lawsuit, which comes as the Biden administration is pledging to crack down on agribusiness consolidation, alleges the acquisition would enable U.S. Sugar and one other company, American Sugar Refining, to control the overwhelming majority of sugar sales across the Southeast.
“U.S. Sugar and Imperial Sugar are already multibillion-dollar corporations and are seeking to further consolidate an already cozy sugar industry. Their merger would eliminate aggressive competition in the supply of refined sugar that leads to lower prices, better quality, and more reliable service,” said Assistant Attorney General Jonathan Kanter of DOJ’s Antitrust Division.
“This deal substantially lessens competition at a time when global supply chain challenges already threaten steady access to important commodities and goods.”
The Biden administration has largely focused its concerns about food and ag consolidation on the meat industry, citing price spikes that occurred during the COVID-19 pandemic.
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U.S. Sugar, which operates a large sugar refinery in Florida, markets its sugar through Minnesota-based United Sugars Corp., a cooperative owned by U.S. Sugar, American Crystal Sugar Co., Minn-Dak Farmers Cooperative, and Wyoming Sugar Co.
According to the lawsuit, United Sugars and Imperial Sugar currently compete to supply customers in a region stretching from Mississippi to Delaware. Imperial Sugar owns a refinery in Savannah, Georgia, and has an intermediate sugar transfer and liquification facility in Kentucky.
In a statement to Agri-Pulse, Louis Dreyfus said, "We are disappointed in the U.S. Department of Justice’s decision to challenge the sale of our Imperial Sugar Company business to U.S. Sugar Corp. and the parties are preparing to litigate. We firmly believe the sale will create production, logistics and supply chain synergies and efficiencies that will benefit US consumers."
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