Lifesavers candy abandons U.S. plant

www.msnbc.com ^ | May 31 | Kevin Tibbles

[FourPeas]

Manufacturer says high cost of sugar in U.S. prompted exit

Several hundred workers at the Lifesavers candy plant in Holland, Michigan are losing their jobs, as the company moves production to Canada. NBC’s Kevin Tibbles reports.

HOLLAND, Mich., May 31 — Sometimes steps taken to protect American jobs, however well intentioned, may in fact have exactly the opposite result. Several hundred workers at a Michigan plant that makes Lifesavers candy are losing their jobs — because the company is moving production out of the United States. It is a very sour ending, for an all-American city.

THEY’RE CALLING it death by sugar. After 35 years, the American candy icon, Lifesavers, is closing its plant in Holland, Mich. Some 600 jobs will be gone by next year.

“That’s about a $35 million hit to the local economy,” says Mayor Al McGeehan.

Kraft Foods says the high cost of sugar in the United States has forced it to relocate its Lifesavers division to Canada, where sugar is nearly half the price.

And Lifesavers isn’t the first candy maker to head for the borders. Others like Chicago-based Broch’s, Bob’s Candies of Georgia and Jolly Rancher in Chicago are either closing or leaving the country. About 11,000 jobs will be lost in these three companies alone.

Americans consume more than seven billion pounds of candy each year, nearly 30 pounds per person. And candy, like lifesavers, is 98 percent sugar.

These days, even though you’re buying a brand of candy you probably grew up with, chances are it’s been made somewhere else.

“If you don’t move, you’re not going to stay in business here in the United States,” says Sal Ferrera, whose father started making candy in Chicago in 1908.

The family makes lemonheads, fireballs, gummy worms and others. Ferrera has opened two plants in Canada and one in Mexico. He plows through two million pounds of sugar a week, and saves as much as 15 cents on every pound by buying it on the world market.

“It’s really sad that now it’s not being made by Americans,” says Ferrera. “It’s being made over the borders and being brought back into this country.”

But America’s sugar producers say sugar prices don’t explain why the candy companies are leaving.

“These companies are too embarrassed to acknowledge the real reason that they may be leaving,” says Jack Roney of the American Sugar Alliance. “And that is to flee American workers, to flee the compulsion to have to pay workers a decent wage.”

But the bottom line is the American candy industry is in decay and candy-making towns like Holland are being left with nothing more than the hole in the middle.

[thescourged1]

What I can't figure out (maybe I'm missing something obvious) is why move at all? Would sugar be tariffed to that extent, coming from Canada? Uhhhh....NAFTA? Ya know? Truck it in.

Open question for the floor.

[scouse]

Kraft Foods says the high cost of sugar in the United States has forced it to relocate

Of course I'm sure the high cost of compliance with government regulations had no hand in this whatsoever.

[Dialup Llama]

Guess they can retrain and get jobs as web masters. Wait with 1 million tech jobs lost, maybe they should get jobs at Kmart. But wait Kmart laid off 25,000....

[1rudeboy]

The US is a large scale net importer of manufactured goods and an exporter of hides, grain, farm products, etc.

Source, please.

[rintense]

The Canadians are taxed at %15 to help cover the cost of healthcare. A large scale revolt would happen in the US if that ever happened here. Drugs may be a bit cheaper, but from what I understand from friends who are Canadian, trying to get a doctor's appointment, let alone one with a sepcialist, is worse than the US HMO system. Again, this is coming from a Canadian friend.

[1rudeboy]

Truck it in.

If you used Canada as a trans-shipment point, the sugar would not be considered a Canadian product, and thus not protected under NAFTA.

[Ferris]

The only entity that should determine the price of any product is the free market...

The government should be nowhere around...

But yet, there the government is, making sure they are taking care of the "little guy"....

Instead, the government crucifies the "little guy" by ursurping more and more of his livelyhood to support programs that, instead of helping, do exactly the opposite by creating problems where none previously existed...

The government sacrifices the "little guy" to continue it's own bogus existence...

The problem is that the "little guy" is too stupid to know that it is the government that is killing him, not businesses leaving for greener pastures...

Remember class,

Free enterprise Business solves problems where they actually do exist....

Force backed Government creates problems where they never previously existed...

[Don Myers]

The main concern of any company is the profit line. If, after taking all things into consideration, they decide they can increase the profit line by moving overseas, they will do it. If they have to make cutbacks for the sake of the profit line, they will do it. The best thing for the individual worker is to go up the food chain. People on the bottom of that food chain get eaten by more people.

[SteamshipTime]

Bush is running things because you can fool most of the people all of the time.

[SteamshipTime]

To put it succinctly, other than a small sliver of South Florida, the climate of the United States is unsuitable for production of sugar cane and beet sugar requires a higher degree of processing. Throw in the five linear feet of environmental and workplace regulations, and it is easy to see why homegrown sugar is more expensive. Tariffs are imposed to make up the difference, but we're not really protecting sugar producers so much as we are protecting the state's environmental and labor law rackets.

[Snowyman]

The Canadians are taxed at %15 to help cover the cost of health care.

We are?

Each province administers it's own health care but it is regulated by the federal Canada Health Act. Ontario has a payroll tax, paid by the employer , on a payroll of over 400,000 @1.9%. (Under $400,000 @ 0%).

I'd suggest your friend get a different doctor. I can see mine simply by making an appointment . And when I see him will depend on the reason. Today if necessary. I have a friend who made an appointment week before last, saw his doctor on last Tuesday, and has an appointment for a MRI on June 9th. Maybe that's slow by private standards ,I don't know.

[rintense]

They are from Toronto. Would that make a difference? Their mother-in-law has had a horrible time getting referred. But I asked the same thing you did, why not get another doctor?

For all the maligning the US HMO system has taken, I've had great service from mine. I recently had an MRI as well, and got the appointment one week from the time I requested it, on the day I requested it. That is almost unheard of where I live. MRIs are so backed up, they have to do them 24 hours a day. Healthcare, I guess no matter where you live, depends on your choice of primary doctor.

[Snowyman]

Toronto. It likely is a problem in Toronto, especially if you haven't needed a doctor or haven't been in the city that long. Specialists ,I don't know. It might depend on what kind of specialist. Some are in short supply. And we middle aged old farts aren't helping things much by getting older. :)

[FourPeas]

Of course I'm sure the high cost of compliance with government regulations had no hand in this whatsoever.

Don't forget the the high cost of sugar is caused by government regulations.

[Sabertooth]

(((ping))))

[bok]

What makes you think canadaian aren't protectionist? Have you ever heard of cancon? (Canadian Content laws) They shut out american ACTORS and CREWS doing tv/film jobs in canada and the canadian government undercut american workers with subisidies and offer producers tax credits to shoot their tv/films in canada.

I won't be eating lifesaver candy or anything from the KF Holdings company.

[bok]

Sorry that should have read canadaian canadians.

[thescourged1]

Thanks. Would that still apply to sugar already purchased by Canada, and then resold to US companies?

[spetznaz]

You sent a post to me that i do not comprehend. It was addressing the issue of Canada, and was in reply to my post (#20). However i did not refer in my material to Canada, and thus i am in no position to discuss on that nation and its protectionist policies. Maybe you confused me with someone else.

[Prodigal Daughter]

And this right after the Mt. Hood helicopter accident that a cable news network called a May Day Mishap.