Grower court action
CANE farmers are set to formalise their opposition to a Sucrogen plan for growers to bear $ 60.9 million in 2010 crop sugar-deal losses, notifying the miller by letter of a dispute in a move that could lead to court action.
Grower interests in the Burdekin said yesterday the letter had been prepared and its receipt by Sucrogen would set in motion a formal dispute resolution process, which could see the matter proceed to court.
Townsville-based community relations manager for Sucrogen Kylie Stockdale said senior management had not received formal notification of a dispute.
News of the growers’ move came as exporter Queensland Sugar and millers agreed on a split among millers of $ 105 million in losses incurred when QSL failed to fulfil sales contracts after wet weather prevented harvesting of much of the 2010 crop.
The losses have seen Australian Cane Farmers Association call for the QSL board to have at least one grower and one miller representative, and for QSL to operate its own pricing pool along- side those run by millers.
QSL is establishing a worki ng group with i ndustry stake holders to review methods and processes with a view to new arrangements to prevent such losses.
The national sugar exporter said a review by Ernst and Young had confirmed its calculation of the 2010 delivery short fal lcosts at $ 105.544 million and the agreed split ‘‘ is seen as the most equitable way to distribute the costs’’.
QSL said millers had proposed that the costs ‘‘ properly reside in the shared pool and, i n general, will be spread over all pools including the US Quota, long-term contracts, fixed-pricing plat- forms and the seasonal pool’’.
QSL said the various regions would deal with the costs, consistent with their specific forward-pricing and pool arrangements.
‘‘ QSL is also offering a deferred payment scheme so that the impact of these costs at an individual grower or miller level can be spread over three seasons,’’ it said.
Milling businesses that operate as co-operatives or are largely owned by growers generally have struck agreements with cane suppliers on ways to meet their portions of the loss.
However, suppliers to Sucrogen mills for the most part reject any responsibility for the costs, saying they constitute a trading loss for which responsibility resides with the owner of the sugar.
The grower interests said farmers believed the dispute resolution process provided the best avenue to obtain a timely and cost-effective response from Sucrogen.
They said the process set time frames for response and negotiations and growers were unwavering in their commitment to pursue legal action if the process failed to resolve the dispute.
The growers said Herbert River farmers and those in t he Plane Creek district around Sarina had been invited to join the Burdekin push to resolve the dispute.