20 January 2015
CANEGROWERS & ACFA
93% growers don’t trust mills to share profits fairly: farmers say fix needed now
A strong message has been shot across the bow of every party on the election campaign trail that if agriculture is a priority for the State of Queensland, they must move now to fix the market failure which is ripping confidence from the State’s cane growers and placing their very futures at the mercy of monopoly millers.
A survey of the State’s growers was sparked following recent moves by three of Australia’s largest mills to leave the industry joint grower and miller owned marketing arrangements – a decision which would completely skew the commercial balance of power firmly in favour of the mills.
The survey has revealed that confidence to continue to invest in the industry has been rocked, as growers grapple with having their long-standing rights and protections wrested away as by large corporate millers seeking to take on marketing of 100% of the sugar themselves.
What has unravelled is a bitter dispute, as growers rise up – looking to government to reinstate measures put in place over 100 years ago to protect them in dealings with their large regional monopoly millers.
“Up until now, growers have had a say over how two-thirds of their sugar was marketed – growers take two thirds of the risk in the production of the sugar and the systems in place had given them a say over the very mechanism by which they are paid,” says Paul Schembri, CANEGROWERS Queensland Chairman.
Mr Schembri says that the mills’ moves to take all sugar marketing on itself would also open the door for mills to be able to move costs around in intra-company transactions, a concern for growers who will no longer have certainty they are getting their fair share of the profits. He says this worry was demonstrated in the results of the survey which show clearly where growers concerns are what action they need to give them confidence in their future.
“The results of the survey were decisive. 97% of growers want to be able to choose the marketer of their sugar and 95% said that government needs to intervene to protect their rights in this regard. 93% said they don’t trust their miller to share the profits fairly if they are not made to do so. 90% said they didn’t want access to a independent marketer taken away.
“It is clear that something needs to be done and quickly. This is ripping at the heart of grower confidence to invest in the industry, with 93% saying they will not have confidence to expand if their marketing choice over the grower share is denied.”
The Australian Cane Farmers Association (ACFA) says that corporate profits over hard working farmers will affect every grower right across the industry, not just those in the areas whose mills have given notice. “The actions of the few will leave the whole industry exposed,” says Don Murday, ACFA Chairman. He says that the ACFA had also sent the survey to its members with the same trends. “The results of this survey clearly shows that growers overwhelmingly want and need government to step in and swiftly rectify the recent imbalance,” says Mr Murday.
“The State’s sugarcane farmers are putting the results of the grower survey before all the parties coming into the election, asking them to show genuine leadership and make strong commitments to fix the commercial imbalance and rectify a plain and simple market failure. It would be perilous for any future government to ignore such a strong message.”
Paul Schembri | CANEGROWERS Queensland Chairman | 0417 604 196
Don Murday | Australian Cane Farmers Association Chairman | 0418 774 499
Stephen Ryan | Australian Cane Farmers Association CEO | 0401 002 322
Suzi Moore | CANEGROWERS Communications | 0427 641 239
We knew that growers were passionate about the issue but were surprised by the response which doubled our expectations over the busy Christmas period, clocking responses from 45% of members. This is on top of 3500 objections received in the form of letters, growers condemning this action in unanimous motions at 5 meetings and online petitions and Facebook protests during last year. The survey released today really galvanises what growers concerns are and what action is needed to give them confidence in their futures. Across the State:
• 97% of growers want to be able to choose the marketer of their sugar.
• 95% said that government needs to intervene to protect their rights in this regard.
• 93% said they don’t trust their miller to share profit fairly if they are not made to do so.
• 90% said they didn’t want access to an independent marketer taken away.
• 93% saying they will not have confidence to expand if their marketing choice over the grower share is denied.
COMMITMENT NEEDED BY ALL PARTIES TO REINSTATE GROWERS RIGHTS & PROTECTION FROM MONOPOLIES
• Amend the Sugar Industry Act 1999 to formally recognise the economic interest in the sugar held by growers and millers and formalise the inherent right of each party to determine how this share is priced and sold.
This is not a return to regulation, but a pro-competition amendment which addresses market failure and restores the protection for growers against regional millers exerting their monopoly powers whilst increasing competition in the market and restoring confidence to invest in Queensland’s second largest export commodity.