Cane grow­ers hit with $2.8m bill

Port Douglas & Mossman Gazette - - NEWS - RICHARD KOSER

LO­CAL cane grow­ers have been handed a $2.8 mil­lion bill for last year’s har­vest.

The charge rep­re­sents Moss­man’s share of a $105 mil­lion short­fall in Queens­land Sugar Ltd’s rev­enue last year.

“There are a lot of farm­ers up in arms,” one grower who didn’t wish to be named said.

“We’re pretty dirty on QSL. We cut our cane, but a lot of the other mills didn’t meet their quota so now we have to pay the price.

“Moss­man has lost the fight against the big mills, but there’s not much we can do about it.”

The fi­nal de­tails had not been an­nounced last night, but sev­eral lo­cal farm­ers felt Moss­man grow­ers were be­ing pun­ished for the in­abil­ity of grow­ers in other cen­tres to har­vest their cane.

Pre­lim­i­nary re­ports, how­ever, in­di­cate lo­cal grow­ers will have to re­pay about $3/ tonne for the 2010 cane har­vest, bring­ing the fi­nal price down from $33/t to $30/t.

Grow­ers will be given three years to come up with the money.

QSL’s mas­sive short­fall last year came through sell­ing too much sugar on the “fu­tures mar­ket” - sugar which never made it to the mills.

Sell­ing com­modi­ties on fu­tures mar­kets is an es­tab­lished and ac­cepted way of get­ting a guar­an­teed price, and cash up front, for pro­duce de­liv­ered later in the year.

As a re­sult of shock­ing weather across ev­ery en­tire sugar-grow­ing district in the state last year, mills were un­able to sup­ply the whole crop which QSL had pre-sold.

To make up the short­fall, QSL was forced to buy sugar at a higher price on the open mar­ket.

While some farm­ers are philo­soph­i­cal about the loss, oth­ers felt QSL had stuffed up.

“Nor­mally, QSL sells about 70 per cent of the es­ti­mated crop on the for­ward mar­ket,” one long-time grower said.

“Last year, they prob­a­bly sold 75 per cent, and then a lot of sugar got taken out of the gen­eral pool for other cus­tomers, so that ra­tio went up to 90 per cent of the crop.

“Then grow­ers were only able to har­vest 70 per cent of what they pre­dicted, and QSL came up short.

“Mind you, if the price had gone down, rather than up, dur­ing the year, QSL would have made money in­stead of los­ing it.”

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