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Cargill, United among sugar companies sued for alleged price-fixing 'conspiracy'

Brooks Johnson and Christopher Vondracek, Star Tribune on

Published in Business News

The sugar industry, which a handful of industry giants have long controlled, has faced antitrust scrutiny for decades. A Department of Justice consent decree in 1978 banned sugar companies from communicating about future prices or coordinating on sugar sales.

The U.S. sugar industry has for awhile enjoyed federal protections against international competition by limiting imports. As a result, domestic sugar prices are typically much higher than prices found around the world.

"The disconnect between international and domestic prices stems from subsidies to growers, import restrictions and other regulations," according to the Federal Reserve Bank of St. Louis.

The lawsuits lay out a scheme involving email communications between sugar company leaders and gathering spots, such as an annual conference, as evidence of price-fixing among suppliers of granulated sugar.

KPH Healthcare Services, a New York company, filed a similar lawsuit in federal court in Manhattan last week.

 

The lawsuits stem in part from the Department of Justice attempting to block United Sugar's purchase of Imperial Sugar in recent years.

"United and Domino have for years shared competitively sensitive information — including current pricing, future pricing and sold positions — with one another through intermediaries," the department wrote in 2022.

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