Tier-2 Sugar Imports Under IEEPA & Section 122 and Outlook with New Section 301 Tariffs

This Ag Trade Monitor examines recent developments in U.S. Tier 2 sugar imports and the effects of shifting tariff policies on trade flows. Tier 2 imports refer to over quota sugar entering after payment of a fixed duty. These imports have increased substantially in recent years as the duty has lost real value and the gap between U.S. and world sugar prices has widened. Imports reached approximately 1.2 million short tons, raw value, in fiscal year 2024, contributing to higher domestic stocks and downward pressure on U.S. sugar prices and producer revenue. The report analyzes how tariffs imposed under the International Emergency Economic Powers Act affected this trade, particularly after the tariff on Brazilian goods increased to 50 percent in August 2025. Brazilian over quota sugar shipments subsequently fell sharply. Other suppliers partially replaced the lost Brazilian volume, demonstrating that the tariffs reduced overall Tier 2 imports but did not close the import channel. The report also considers the outlook following the expiration of the IEEPA tariffs and the temporary Section 122 surcharge, as new Section 301 tariffs create uneven rates across suppliers. Because the Tier 2 duty remains fixed and the U.S. and world price spread continues to support profitable imports from lower tariff origins, over quota import pressure is likely to persist, with trade potentially shifting among supplying countries in response to tariff differences.