Concern over sugar's $105m black hole

THE Queensland sugar industry has launched multi-pronged investigations to avoid a repeat of the massive shortfall resulting from the sodden 2010 season.

The industry is facing a huge $105 million hole in export income, the liability of which is now the subject of much dispute among cane farmers, their representatives and industry bodies.

Canegrowers, which represents growers from Mossman to the Tableland and Tully, announced yesterday an investigation into sugar pricing issues, saying the shortfall illustrates a failure in the industry’s pricing system.

“Many cane growers are feeling very angry, frustrated and let down by what they understood was a forward pricing system that they could rely upon to better manage their risk,” said Canegrowers CEO Steve Greenwood.

“It would now appear that this is not the case.”

Months of negotiation and discussion has taken place to determine who is liable with no resolution to date.

“Canegrowers is absolutely committed to taking charge of this issue and fixing it so we will not be faced with the same issues in the future,” Mr Greenwood said.

Queensland Sugar Ltd last week announced its own investigation through a sugar industry working group.

QSL chief executive and managing director Neil Taylor said lessons from the “truly awful” season would be learned.

“QSL is currently working through a number of issues with mills regarding the 2010 crop shortfall,” Mr Taylor said.

“As soon as these issues have been resolved, we will establish an industry working group to find a way to move forward from the season as quickly as possible.”

The review will also look at how to manage the seasonal pool so it gives growers and millers a good price without being as vulnerable to production risks.

source: cairns