Wikipedia Deep Dive

U.S. Sugar

9 min read

In 1942, the United States Department of Justice charged U.S. Sugar Corporation with violating federal anti-slavery laws. That's not a typo. Eleven years into its existence, America's largest sugarcane producer faced allegations that would seem more at home in the antebellum South than in mid-twentieth-century Florida.

This is a company whose history reads like a crash course in American capitalism at its most complicated: industrial philanthropy, environmental destruction, labor exploitation, stock manipulation, and billions of dollars in government subsidies—all wrapped around the simple act of growing sugarcane in a swamp that was never meant to be farmland.

The Swamp King

U.S. Sugar began its existence in 1931, during the depths of the Great Depression. Charles Stewart Mott, an industrialist who had made his fortune as a co-founder of General Motors, looked at the bankrupt remains of a company called Southern Sugar in the remote Florida town of Clewiston and saw opportunity. He bought the assets and formed the United States Sugar Corporation.

Clewiston sits on the southern shore of Lake Okeechobee, in a region that early twentieth-century developers had aggressively drained from the Everglades. The Everglades, for context, had been one of the largest wetland ecosystems in North America—a slow-moving river of grass that once covered nearly three million acres of southern Florida. To sugarcane farmers, it looked like potential cropland.

The soil was incredibly fertile, enriched by thousands of years of decaying vegetation. But there was a catch. The land wasn't naturally suited for agriculture. It had to be kept artificially dry through an elaborate system of canals and pumps, fighting a constant battle against nature's desire to return it to swampland.

Labor in the Cane Fields

Sugarcane harvesting is brutally difficult work. The canes grow in dense thickets, often ten to fifteen feet tall, and must be cut close to the ground where the sugar content is highest. In Florida's subtropical heat, workers wielding machetes can face temperatures exceeding a hundred degrees amid the sharp leaves and dense stalks.

For decades, U.S. Sugar and other Florida sugarcane producers relied on migrant labor, much of it imported from the Caribbean under a program called H-2, which allowed temporary agricultural workers into the United States. The 1942 slavery charges—while the full details have been obscured by time—indicate that the working conditions could cross the line from merely harsh into something far darker.

The company eventually moved toward mechanization. By the early 1990s, mechanical harvesters began replacing human cane cutters. This transition wasn't driven by humanitarian concerns. It was economics. Machines don't file lawsuits, don't require housing, and don't complain about working conditions.

The displaced workers did file a lawsuit, though. In 1998, U.S. Sugar paid over five million dollars to settle a class action brought by the cane field workers whose jobs had been eliminated.

The Mott Legacy

Charles Stewart Mott was not merely wealthy—he was philanthropically ambitious. The Charles Stewart Mott Foundation, which he established, became one of the major charitable organizations in America, particularly focused on education and community development in Flint, Michigan, where General Motors was headquartered.

When Mott transferred his U.S. Sugar shares to his foundation, it created an unusual situation: a major charitable organization tied to the profits of industrial agriculture. This arrangement hit a legal snag with the Tax Reform Act of 1969, which limited how much stock a private foundation could hold in any single company. To comply with the thirty-five percent cap, the foundation transferred shares to the Mott Children's Health Center, a medical charity in Flint that had been founded in 1939.

The interlocking ownership between a charitable foundation, a children's health center, and a sugarcane corporation created a structure where the financial interests of sick children in Michigan were technically aligned with the production of sugar in Florida. American capitalism has a talent for producing these peculiar arrangements.

Diversification and Decline

When C.S. Mott died in 1973, his son C.S. Harding Mott took over as chairman. The company soon faced a crisis that had nothing to do with labor or weather.

High-fructose corn syrup.

In the 1970s, sugar prices spiked to sixty cents per pound, which sounds modest until you consider that food manufacturers buy sugar by the ton. The high prices gave scientists and food companies powerful motivation to find alternatives. High-fructose corn syrup, derived from abundant and heavily subsidized American corn, emerged as a cheaper substitute for sugar in processed foods and soft drinks.

U.S. Sugar responded by diversifying. They bought South Bay Growers in 1980, a company that produced thirteen percent of America's leafy vegetables—lettuce, celery, and similar crops. They expanded into cattle. In 1985, they started planting orange trees.

The vegetable operation never thrived. South Bay Growers was mostly shut down in 1994 after four years of losses out of five, including ten million dollars in the final year. The salad processing plant, which supplied McDonald's and Burger King, was sold off.

In 1962, the company had opened the Bryant Sugar House, then the largest and most advanced sugarcane processing mill in the world, capable of processing five thousand tons of cane daily. By 2007, it was closed.

Going Private

In 1983, U.S. Sugar created an Employee Stock Ownership Plan, commonly called an ESOP. This financial structure allows a company's employees to own shares in their employer, theoretically aligning worker and company interests. In practice, ESOPs are often used as mechanisms for companies to go private, removing themselves from the scrutiny that comes with public stock trading.

U.S. Sugar borrowed heavily to fund the ESOP, buying out public shareholders. Not everyone sold willingly. Some shareholders believed the offered price was too low, triggering a class action lawsuit. By October 1987, the ESOP and the Mott-controlled ownership group offered eighty dollars per share for the remaining 110,000 voting shares held by about five hundred public shareholders. The company went private.

The ESOP would later become the subject of another lawsuit, filed in 2008. Employees alleged that they weren't receiving full value for their stock. They pointed to offers from the Lawrence family, an agricultural conglomerate, who had allegedly bid two hundred ninety-three dollars per share for the company—more than three times what employees were receiving for their ESOP shares.

The company countered that the Lawrence offer, roughly five hundred million dollars total, was well below market value. They would soon have dramatic proof of this claim.

The Two-Billion-Dollar Question

On June 24, 2008, Florida Governor Charlie Crist made an announcement that stunned environmentalists, sugar executives, and Florida taxpayers alike. The state was negotiating to buy 187,000 acres of U.S. Sugar's land, plus all its manufacturing and production facilities, for an estimated 1.7 billion dollars.

The purpose? To restore the Everglades.

The Comprehensive Everglades Restoration Plan, launched in 2000, was the largest environmental restoration project in American history. Its goal was to undo more than a century of drainage and development that had reduced the Everglades to half its original size and left it ecologically damaged by agricultural runoff, particularly phosphorus from sugarcane fertilizers.

Under Crist's proposal, U.S. Sugar would continue farming the land for six years, then the state would convert it back to marshland. The sugar company would essentially be bought out of existence, at least its Florida operations.

The deal didn't survive the 2008 financial crisis intact. By November, the offer had been revised down to 1.34 billion dollars, with the sugar mills in Clewiston remaining in production. Environmentalists criticized the revision, noting that it ensured sugarcane would continue to be grown in the Everglades for at least another decade.

In 2010, a much smaller transaction actually occurred. U.S. Sugar sold 26,800 acres to the South Florida Water Management District for the "River of Grass" Restoration Project—a fraction of the original deal's scope.

Big Sugar

U.S. Sugar doesn't operate in isolation. Along with Florida Crystals and the fifty-four-member Sugar Cane Growers Cooperative of Florida, it forms what's locally known as Big Sugar—a political and economic force in South Florida.

Together, these companies farm hundreds of thousands of acres, employ more than twelve thousand people, and generate an estimated 3.2 billion dollars in economic activity. U.S. Sugar alone employs over 2,500 workers across Hendry, Glades, Martin, and Palm Beach counties.

But here's the uncomfortable economic reality: sugarcane grown in the United States costs nearly twice as much per pound as sugar produced in other developed countries. Without government price supports, tariffs on imported sugar, and other subsidies, the American sugar industry would likely collapse.

The sugar lobby has been remarkably effective at protecting these programs through decades of farm bills and trade negotiations. Big Sugar's political donations flow to both parties, ensuring that whoever controls Congress will think twice before threatening the industry's protected status.

The Company Today

U.S. Sugar remains privately held, farming over 230,000 acres in south-central Florida. It produces more than 700,000 tonnes of sugar annually, making it the largest sugarcane producer in the United States by volume. The company has diversified into sweet corn and oranges, having learned from the South Bay Growers failure that some diversification works better than others.

The company operates its own railroad, the South Central Florida Express, to move cane from the fields to the mills. It maintains a steam locomotive, U.S. Sugar 148, as a preserved piece of industrial heritage.

The Everglades continue their slow ecological decline, though restoration efforts have made some progress. The phosphorus-laden runoff from sugarcane fields continues to fuel algae blooms. The original ecosystem, the river of grass that once flowed unimpeded from Lake Okeechobee to Florida Bay, exists now only in fragments and memories.

And in Clewiston, a small town of around seven thousand people, U.S. Sugar remains what it has been for nearly a century: the dominant employer, the economic engine, and the company that turned a swamp into an empire. The trade-offs embedded in that transformation—environmental, social, economic—continue to shape the region in ways that Charles Stewart Mott, looking at those bankrupt assets in 1931, could never have fully imagined.