American Crystal Sugar to default on government loan
FARGO, N.D. (AP) – American Crystal Sugar will default on a government loan of $71.2 million under a program that provides relief when a glut of sugar depresses prices.
David Berg, American Crystal Sugar president and CEO, tells the Forum newspaper that forfeiting the sugar put up as collateral was the best option, given very low sugar prices.
The loans end with the crop year, which concluded on Oct. 1.
The forfeiture is under a U.S. Agriculture Department program. It is the result of sugar being cheaper and more plentiful that at any time in the past decade.
Berg says defaulting on the loan does not present a financial hit to the company. He says the default is beneficial to American Crystal Sugar’s financial health, and that’s the way the program is designed to work.