Early planting is happening spasmodically across the district with sunshine and rain almost a daily double. The sugar prices have rallied somewhat over the past week but look to remain around the low $400’s for the immediate future. The $Aus remains strong and the market expectations are for a general increase in sugar cane area planted.
The 2010 crop estimations continue to look positive, although the pattern of wet weather is a concern on the forecasts for the early part of the season. Discussions on the ACFA Cane Supply agreement are still pending, with some concern over the potential for an end of May start. As Sucrogen will benefit through additional cogeneration revenues, etc. from an early start, it is not unreasonable to argue for growers to share in those benefits to compensate for the negative financial results of an early start on their ccs. The Bright Foods offer is still in the throes of discussion and legal argument, with the outcome likely to cause considerably more conversation and wrangling yet. The delaying of CSA negotiations, which remain in the ‘too hard basket’, appears to hinge on the Sucrogen/Bright Foods issue being resolved. This has again placed the growers’ interests at the end of the queue and confirms the failure of the industry deregulation legislation to deliver in any shape or form, for growers. Another ‘eleventh hour cloned CSA’ is unsatisfactory and unacceptable to the district’s growers.
The recent workshops held to offer information on improved fertilisation efficiency for growers have been well received and both the BSES and Synergy workshops have been well attended. Growers who are early planting should be soil testing their blocks prior to planting and recording and analysing their requirements for both nutrients and pre-emergent chemical usage. Difficulties or concerns by growers should be directed to the BSES, BPS or the relevant Reef Protection officers employed.
Elections of the various grower body representatives have taken place recently and I wish the successful candidates and outgoing representatives well in their endeavours for growers and for interests of the district.
Sucrogen advise that the maintenance scheduling at the mills is progressing well, with the capital works projects nearing completing in readiness for the season’s commencement. Steam trials are likely to commence in mid-May.
The Queensland government has appointed the Qld Competition Authority (QCA) to review and advise government on water pricing. A draft report and draft pricing is due by no later than 31-01-2011. Additional information is available at: www.qca.org.au/water.Sun-Irrig-Price/index.php or on (07) 32220555.
Sucrogen pricing advice is as follows: “As you all will be aware, sugar prices have fallen sharply during the past two months. The May 2010 contract had fallen to about 16c/lb by the end of March, from a high of 29c/lb at the beginning of February.
While the weakness has been significant, it has not impacted on the 2012 futures contracts at the back of the futures curve, which are largely unchanged over the same period.
The large fall in 2010 prices has been attributed to a number of factors:
– The EU’s announcement it intended to export an additional 500,000 tonnes of sugar;
– Estimates of India’s 2009/10 production rising from about 15 million tonnes to more than 18 million tonnes quite late in the season as cane availability was significantly under estimated;
– The availability of sugar for export from Brazil’s Centre South during the first quarter this year being greater than expected. While this was partly due to sugar destined for the domestic market being diverted to export, it seems largely the result of under estimating stocks at the start of the season. The result was an “additional” one million tonnes of sugar;
– Fund/speculative selling as long positions have been reduced. The addition of about five million tonnes of sugar largely resolved what was expected to be a period of production deficit.
The current market appears to be factoring in near-perfect weather for the 2010/11 Brazil Centre South season and a return to “normal” monsoon weather patterns ahead of India’s 2010/11 season. With global pipeline sugar stocks at very low levels, weather disruptions have the potential to have a significant impact. Prices of about 16c/lb are close to full marginal cost of production in Brazil and, if maintained, could have a negative impact on the Brazilian industry’s ability to expand in 2011/12.
The recent fall in the market has caused uncertainty for many growers regarding the strategy they should adopt for their forward pricing. However, critical considerations when deciding at what level to forward price will remain your cost of production, the minimum price you need to be profitable and debt funding requirements.
Sucrogen’s pricing website allows you to place orders (for the 2011 and 2012 seasons) and have them sitting in the market pending a possible price spike. If, over time, such orders are not filled, there remains plenty of time to adjust or cancel any orders if required.”
“Sucrogen will hold grower-information sessions in your region in the first week of May. David Trevor, Sucrogen’s Risk Manager based in our Sydney office, will be a guest speaker at these sessions. We will be presenting a market update focused on the recent drop in prices, as well as the outlook for the 2011 and 2012 seasons, which is where most growers still have the ability to price. Pending confirmation from QSL, the 2010 advance schedule will be announced at this meeting. David Burgess will also be at these sessions, so for those growers who have not yet had a chance to meet David, this will be another opportunity to do so.
In the coming weeks we will ask for feedback from growers about other issues/topics they would like to be discussed at these information sessions. We are aiming to present new and higher-level information in each round of information sessions, so each round builds on the previous and sessions are relevant and useful to growers.”
A further round of computer-based training sessions will be held on ‘Understanding how you are paid’. “They explain how to generate, read and use the current and future season forecast tools available on the Grower Web. These forecasts give growers an individual picture of their expected sugar prices, cane prices and income. The sessions are free but bookings are essential. Further information will be sent out in the coming week.”
BPS have advised that the grower membership fee for the 2010 season has been set at 6.5 cents per tonne +GST. Approximately 98% of Burdekin growers are members of BPS.
Nominations are currently being called for three grower directors of Burdekin Productivity Services, closing at 5pm on Monday, 10th May, 2010. Growers are encouraged to consider nominating to represent the interests of the district’s growers and the industry.
Approved Plots – Inductions
BPS advise that “contractors and growers who collect cane from the plots are advised that this year a short onsite OHS induction will be given by the site supervisor and are required to wear enclosed footwear when visiting the plot. All machinery that enters the paddocks on the plots, such as tipper bins and harvesters are required to have a fire extinguisher fitted.”
Approved Plots – Seed Cane Orders
“Orders for approved seed cane supplies have closed as at the end of March. However, those growers who are still seeking quantities of approved seed should contact their BPS staff member for any remaining unallocated cane. Regular use of approved seed is an insurance against endemic diseases such as Leaf Scald, RSD and Chlorotic Streak, and will assist in managing Smut. The cost involved with purchasing a tonne of approved seed is offset by the proceeds of the extra cane that growers send to the mill and is also tax deductible.”
Approved Plots – Opening Times
Growers are advised that Approved Seed Plots are now opened and that when visiting the plots to collect cane, all machinery must be clean and free of potential disease carrying substances such as old plant material and dirt. “Field staff will inspect and sterilize equipment prior to collecting cane, and have the right to refuse entry if equipment is not clean. Hygiene is of the utmost importance, and growers and contractors should take all necessary precautions to ensure the plots remain free of disease. Contact your field officer if there is any doubt as to what is required. Please contact your field officer to check when seed cane is available from each plot.”
Sugarcane Smut Disease
“To date the majority of findings have been in the susceptible varieties Q117, TellusA, Q127, Q 189A and Q163. Growers are strongly encouraged not to plant these susceptible varieties in the coming season. Many of the infested blocks have been ploughed out which has considerably reduced the level of known infested crops remaining in the 2010 crop. However, new infestations will be found as activities increase during the early planting and as the crop continues to mature.”
Q183 A Intermediate Resistant
“In August 2009, BSES released information that the smut resistance rating of Q183A has been upgraded from intermediate susceptible to intermediate. Field observations of Q183A in the Burdekin and in several regions with a higher level of smut infestation pressure have shown that to date, this variety appears to be more tolerant to smut than at first expected. It remains a very strong variety.”
No Varieties are immune to Smut
“Smut resistant varieties may occasionally show low levels of smut but should not suffer yield losses similar to susceptible varieties. BPS and BSES recommend that growers spread the balance of their crop across a number of varieties to reduce too heavy a reliance on any one variety.”
“RSD surveys have been completed on all approved plots with no RSD infections being found on any plot sites. BPS wishes to advise growers that field staff will also be conducting general RSD surveys in the Pioneer and Invicta mill areas this year. Older ratoons are more likely to have the disease present and are therefore the target of the sampling program. Field staff will contact growers who have been selected for the survey prior to the survey commencing. Growers in the survey will be notified of the results.”
Plant Source Inspections
“Growers are encouraged to have BPS field staff conduct a plant source inspection on planting material in order to assist with the management of poor strikes and disease control. We ask that as much notice as possible be given to field staff to ensure that the inspection is done prior to the material being required. Three days notice should ensure that inspections are conducted in time.”
Burdekin Director & Jnr Vice-Chairwoman,