Sugar price fall leaves sour taste

The Courier-Mail - - NEWS - MICHAEL MADI­GAN

QUEENS­LAND cane­grow­ers, who have en­dured boom and bust for more than a cen­tury, are weath­er­ing an ugly crash in the sugar price that many fear may ac­cel­er­ate an ex­o­dus from the iconic in­dus­try.

Sugar is now hov­er­ing be­tween 10 and 11 US cents a pound, well be­low the cost of pro­duc­tion, while a mas­sive global sur­plus gives lit­tle hope of a price im­prove­ment over the next year or two.

Just two years ago, sugar was more than 22 cents a pound, as farm­ers who had di­ver­si­fied into other crops looked to re­turn to sugar to reap the sub­stan­tial re­wards.

But Cane­grow­ers Queens­land chair­man Paul Schem­bri says Queens­land farm­ers are in­creas­ingly the vic­tims of sub­si­dies in com­pet­ing coun­tries.

In­dia has gone from pro­duc­ing 20 mil­lion tonnes to 30 mil­lion in the past decade us­ing gov­ern­ment pro­tec­tions.

“If this was a case of sup­ply and de­mand we would be OK, but this cur­rent global sur­plus is be­ing un­der­writ­ten by sub­si­dies,’’ Mr Schem­bri said. “The global com­men­tary sug­gests the price is not go­ing to lift any­time soon and if the price stays in this place it will cause se­ri­ous eco­nomic prob­lems.’’

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