High sugar price is sweet news
HIGH sugar prices are giving local cane growers a chance to catch up after several poor growing seasons.
Refined sugar is currently trading on world markets for around $450 a tonne. For growers this translates to about $35 a tonne of sugar cane, up from last year’s low of about $25.
“Pretty poor, pretty abysmal,” is how Richmond River Cane Growers’ Association manager Andrew Tickle described last year’ssugarcane season, when the yield was also severely affected by floods and frost.
The boost to the sugar price has been caused by a deficit on the world market, created when large sugarcane growing countries such as Brazil and India switched to other crops.
In Brazil, farmers are now growing ethanol-producing crops rather than sugar; while inIndia, the slashing ofgovernment subsidies to cane growers has seen farmers turn to more profitable cash crops.
Mr Tickle said the high prices would give growers a chance to catch up, rather than get ahead.
He expected the high prices would continue into the next growing season, but that demand for sugar would lead to a production surge which would eventually bring the price down
Mr Tickle said sugar prices were ‘cyclical’.
“Just when you think you have hit the bottom, something happens and bang you are on top of the wave again,” he said.
Richmond River Cane Growers’ Association chairman and Pimlico cane grower, Wayne Rodgers, said the buoyant price had lead to an increase in sugarcane plantings in thelocal industry.
He said rainfall at the weekend had been also good for growers.
NSW Sugar Milling Co-operative chief executive Chris Connors said the outlook for the industry was positive.
Northern Riverssugarcane is sold on the domestic market to customers such as Coca-Cola and Nestle.