Sugar runs through Allan Parker’s veins.
He is a fifth-generation cane farmer in the Burdekin, a region of north Queensland home to the nation’s most productive cane operations.
He has just finished planting next year’s crop, at a time when prices are sky-high due to a global shortage.
It should be cause for celebration.
“The prices are excellent, world highs that we haven’t seen for such a very long time,” Mr Parker says.
“It would go a long way to paying a lot of debts that we’ve incurred over the last few years of low prices.”
Instead, Mr Parker and the other 550-odd growers who work this rich 85,000-hectare patch of land just south of Townsville are facing a fight for survival.
They are in a dispute with one of the world’s most powerful commodities traders, Singapore-based conglomerate Wilmar, which bought CSR Sugar six years ago and which Mr Parker and his fellow growers claim is attempting to squeeze their livelihood from them.
It is a situation that has come to the attention of Federal Agriculture Minister Barnaby Joyce, who issued Wilmar a blunt warning.
“If you want to drag this out at a federal level, we can,” he says.
“We are going to make absolutely certain that farmers are treated fairly.”
Wilmar is also on the radar of competition regulator, the ACCC.
Growers say Wilmar’s deal includes restrictive clauses
The plight of the Burdekin cane growers is likely to become a lightning rod in the escalating debate over foreign investment, particularly rural land and agribusiness.
Wilmar now owns every mill in the Burdekin area and with that comes enormous power.
Farmers simply cannot have their cane processed unless they have a supply contract with Wilmar. And this year, the farmers argue that the contract on offer is unacceptable.
“We’ve had bad contracts before, but this is the pits,” Mr Parker says.
What has riled farmers this year is the clauses added by Wilmar, which the growers say are restrictive.
They say among the worst of the clauses is one that dictates the miller can arbitrarily reject cane, meaning the grower receives nothing.
Wilmar also wants the right to launch legal action against growers who sell their farm to a buyer who no longer wants to grow cane.
The biggest grower in the Burdekin, Geoff Cox, has a 2,700-hectare operation employing 20 full-time workers and millions of dollars of machinery and infrastructure.
Standing in the midst of a paddock that was burnt the previous night, while harvesters load their rich bounty into tippers destined for processing at the mill, Mr Cox — pointing to the broad expanse of cane that will ripen next year — explains how Wilmar is ramping up the pressure.
“This cane, like all the cane across the region, will be ready for cutting in the middle of next year,” he says.
“By then, farmers need a contract and Wilmar knows that. We will have to sign a contract, no-one can afford not to. If it comes right down to the wire and harvest is about to start, we’ll have to sign that contract no matter how bad it is.
“We have to sign that contract.”
Farmers say they have no alternative to ‘raw’ Wilmar deal
The growers claim they are getting a raw deal.
They point to the huge pricing difference offered by Wilmar compared to Queensland Sugar Ltd, which traditionally has been the single desk for selling local sugar.
Wilmar’s own documents show that it is paying $104 less than QSL. It is a big margin considering QSL is paying $580 a tonne.
Growers originally welcomed Wilmar’s arrival. The idea that it would compete with QSL was sold as a benefit.
But now that it wants to market sugar, and not simply process it, the company has the potential to create a monopoly.
Wilmar is in contract dispute with QSL and it is blocking QSL’s access to the material.
As a result, farmers have no alternative.
“The terrible conditions that they’ve put into our cane supply contracts just means that if they can’t get money at one end they can get it at the other end just by screwing us there,” Mr Parker says.
“It could make or break a lot of people.”
Government wants ‘fair price’ for farmers: Joyce
According to Mr Cox, growers will be left with little alternative but to ask for government intervention, a move that Mr Joyce seems willing to consider.
“We are going to make absolutely certain that farmers are treated fairly,” Mr Joyce said.
The Queensland Government attempted to intervene last year with legislation that would ensure farmers retained a choice in marketing their product.
But it is not working and Mr Joyce is not pleased.
“We want Wilmar to act in the spirit of the law because we want a fair price for farmers,” he says.
Liberal-National MP George Christensen recently accused the company of unconscionable conduct and called on the ACCC to intervene.
The company met with the competition watchdog on Tuesday and told the ABC it is sure that claims of abuse of market power “will be found to be without substance”.