Second-tier Mexican sugar

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Second-tier Mexican sugar is extra sugar Mexico exports to the United States beyond its quota. It faced a tariff that fell each year under NAFTA: raw sugar down 1.5 cents per pound and refined sugar down 1.6 cents per pound, until January 1, 2008 when it became duty-free. Before 2008, Mexican sugar could be cheaper for U.S. buyers if the total cost—tariff, the world price for sugar, and transport to U.S. Gulf ports (about 1.5 cents per pound)—was below the U.S. sugar program's loan-forfeiture price (a price support level). Sugar from other countries above their quotas had higher tariffs and did not get these declines. The tariff is set under WTO rules and acts as a prohibitive barrier that keeps world sugar from entering the U.S. market.