A minority representative grower group may have cost the sugar industry its ‘preferred supplier’ status in a corrupted international marketplace, after it voted down essential changes to the constitution of sugar marketing body, Queensland Sugar Limited (QSL).
“The Australian Cane Farmers Association (ACFA) has blood on its hands after walking away from a deal which was set to bring about greater cohesion and focus on export sugar marketing,” said Ian Ballantyne, CEO of Canegrowers, which represents over 80pc of the State’s sugarcane growers.
“The changes were aimed at removing the last vestiges of ‘sugar industry politics’ from the commercial world of sugar marketing.
"In spite of overwhelming support - over 95pc of QSL’s grower and miller representative members voted to support the changes - a marginalised grower organisation, ACFA, leveraged its power of veto, overturning the decision of the democratic voting majority.
"The proposed changes to the constitution had been put forward in a bid to make Queensland’s sugar marketing more commercial and transparent.
"Sugar suppliers to QSL had stated that they were not prepared to commit to new contractual marketing arrangements until QSL had been restructured and depoliticised.
"The proposal outlined by QSL had been well received by the overwhelming majority of growers and millers, who had come out in public support of the proposed changes.
“Growers and millers would continue to be the beneficiaries of the ‘single desk’ marketing approach and would continue to own the marketing agency – QSL,” he said.
As part of depoliticising the process, it had been proposed that the ‘golden votes’ held by Canegrowers and ACFA, be taken out of the process.
These golden votes could be used to overturn certain constitutional changes otherwise made by the democratic majority of the members.
The chairman of Queensland Sugar, Keith De Lacy, said it was extremely disappointing that, despite over 95pc support from grower and miller members at the meeting, a minority grower body such as ACFA had put its own interests above the wishes of the vast majority of the industry.
Mr Ballantyne agrees, saying, “The risk now is that milling companies revert to previous considerations of establishing a miller-only ‘Australian Sugar Export’ marketing company, which would effectively terminate growers' interests in the supply chain.
“There is also a distinct possibility that the industry could now fragment.
"Matters including access to Sugar Terminals, pricing instruments and future stability now had uncertain futures. "Growers were certainly now at risk of being excluded from participation in marketing and related arrangements.
“ Canegrowers will now meet with other stakeholders to pursue any and all options which may retain the benefits currently accruing from the single face marketing arrangements – and effectively terminated today by the ACFA’s inability to understand the ramification of its actions.”