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Tuesday, May 15, 2007

You Can’t Blame the US Sugar Program For This

By The Whistler on May 15, 2007 at 05:14 am
1 Comment

A few years ago it was big news that the Lifesavers candy plant was moved from the US to Canada.  The reason given by the makers of Lifesavers, Kraft foods, was the US sugar program that made their raw materials costs out of line.

It looks to me like they were fibbing if that was the reason:

Hershey Co. is closing its last Canadian factory, laying off 580 workers and moving part of the production to the United States and Mexico.

I’m thinking that Kraft was using the program as an excuse for a bailout and didn’t get it.

Here’s an interesting article on the Sugar industry.

In the interests of full disclosure you should know that the sugar industry is a huge business where I live.

Comments

Avatar for Robert Perry

Actually, it may have been an issue, and another big issue is that Illinois, especially Chicago, has socialism problems that in some regards make Canada’s look small.

I did a quick calculation, and the cost of the sugar (wholesale estimate) in my dollar bag of “Vitamin M&M” is about a penny.  So if you cut that by half, that is a cost reduction that managers will pay attention to.  I’d guess that the same holds for Life Savers.

So a lie?  No, but perhaps not the only reason, either.

Robert Perry on May 16, 2007 at 10:45 am
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