Cane growers hit with $2.8m bill
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.”