Nats launch inquiry to examine possible market imbalances in sugar industry

4 September 2014

Canegrower concerns over supply chain market imbalances in the $2 billion Australian Sugar Industry will be examined by a Senate committee after an inquiry was announced in Canberra today.

The inquiry, which passed through the Senate at noon on Thursday, has been instigated by Queensland Nationals Senator Barry O’Sullivan and New South Wales Nationals Senator John Williams.

Under the inquiry’s terms of reference that passed through the Senate, the Rural and Regional Affairs and Transport References committee will examine supply chain issues such as equitable access to infrastructure, impacts of foreign ownership and whether there is a need for stronger competition laws.

The committee is expected to present its report by 27 November 2014.

Growers through the cane-growing regions of Queensland and New South Wales have expressed concerns over impacts on market power following the announced decision of some major sugar milling companies to exit the current industry marketing arrangements from 2017.

This review will be the first time the issue of market imbalances in the sugar industry has been Federally reviewed in more than a century.

Senator O’Sullivan said strong lobbying from local growers and his Queensland House of Representative colleagues had convinced him of the need for an inquiry.

“My LNP Queensland colleagues who sit with the National Party in the House of Representatives have pushed long and hard for a Senate inquiry and it is pleasing to announce it will proceed,” Senator O’Sullivan said.

“The intended exit from the QSL single desk system by the major milling companies in 2017 will be the most significant change to the Australian Sugar industry in more than a century.

“The seriousness of this structural overhaul and the vocal concerns of growers means government must examine the situation.”

Senator Williams said the inquiry responded to concerns raised by growers in New South Wales and Queensland.

“I had met with growers in the Tweed region and they raised their concerns about the direction their industry was heading,” he said.

“We cannot afford to see another Australian industry on its knees. As legislators, we must find out what the problems are and work to address them.”

Inquiry Terms of Reference:

That the following matter be referred to the Rural and Regional Affairs and Transport References Committee for inquiry and report by Thursday, 27 November 2014.

Current and future arrangements for the marketing of Australian sugar, including:

  • The impact of proposed changes on the local sugar industry, including the effect on grower economic interest sugar;
  • Equitable access to essential infrastructure;
  • Foreign ownership levels in the industry and the potential to impact on the interests of the Australian sugar industry;
  • Whether there is an emerging need for formal powers under Commonwealth competition and consumer laws, in particular whether there are adequate protections for grower-producers against market imbalances;
  • Any related matters.

Media Contacts:
Senator Barry O’Sullivan: Troy Rowling 0400 386 666
Senator John Williams: Greg Kachel 0428 253 560