AGRICULTURE: by Patrick J. ByrneNews Weekly
Farmers' overwhelming support for alternate sugar package
, November 2, 2002
In record numbers at cane farmer meetings, growers have rejected the Queensland and Federal governments' proposed deregulation plan and finance package for the industry. Instead, they have overwhelmingly supported an alternate eight point plan to return the once vibrant industry to profitability.
Meetings headed by leading identities in the industry and by Federal independent MP, Bob Katter, have reached about half the 6,500 cane farmers in Queensland and northern NSW.
So far, seven farmers' meetings have been held, with more to come.
Approximately 700 farmers attended one meeting in Ayr. About 800 attended the Ingham meeting, and another 500 in Mackay. Out of these three big meetings, there was unanimous rejection of the Federal and State governments' package, and overwhelming support for the eight point plan.Spirit of unity
According to one committee member from the Burdekin region, Margaret Menzel, "The spirit of unity and determination among farmers is unprecedented.
"For the first time farmers are having explained to them what the government package really will mean for them and are being presented with a viable alternative for the industry.
"After the meetings, farmers in large numbers have mobbed us and congratulated us. Invariably they ask us one thing, 'promise us you will not compromise on any of the eight points in your industry plan?'
"So far we have run meetings from Mackay north. But farmers have come from all the southern areas to our meetings to check our bona fides. They have agreed with what we are proposing. They have issued our committee invitations to run meetings in all their cane growing areas.
"For months I have fielded regular phone calls from wives, relatives and neighbours concerned that a farmer was going to suicide. Many have had no income to live on for several years due to deregulation, bad seasons, pests and low world prices. The proposed government package would spell the end of their industry and leave them with nothing."
Cane farmers have been hit hard by National Competition Policy, which forced partial deregulation in 1996 in the face of a highly corrupt world market for sugar. The world price for raw sugar is half the world average cost of production, due to high levels of government subsides for sugar and ethanol.
It is estimated that this year revenue for Australian raw sugar could be down by as much as $600 million (about 37%) on eight years ago.
In the package being offered by the Federal and Queensland governments, three things have angered and united farmers.
First, about two-thirds of the $150 million package is effectively for politicians in the sugar producing electorates to use for pork barreling.
Second, a memorandum of understanding (MOU) signed by the two governments will see the abolition of single desk selling into the domestic market. Farmers sell to 26 mills in Queensland, which sell to a handful of major sugar processors across the country. All the market power resides with the supermarkets, processors and refiners.
Without single desk selling, supermarkets, refineries and processors will be able to bid off one mill against another and force the price of sugar into the domestic market even lower than the corrupt world price.
Retention of the desk is absolutely necessary to give farmers some bargaining power and a future.
Third, to add insult to injury, the government plans to abolish the compulsory collective bargaining arrangement between millers and farmers. This long established system under Queensland law, requires the mills to annually negotiate a set price with farmers for all cane in their mill supply area before the start of the season.
If this is abolished, then not only will the small group of sugar buyers bid one mill against another and force the domestic sugar price below the corrupt world price, but the mills will then bid one farmer against another to force down the price paid for their cane.
According to Margaret Menzel, "What this means is that 1996 National Competition Policy partial deregulation has almost bankrupted the industry, and the two governments' response to this disaster is to now completely deregulate the industry. If this happens, it will destroy one of Australia's most successful rural industries."
With that in mind, it is notable that while leaders of the main farmer peak council, Canegrowers, have been reported in the press urging farmers to accept the two governments' package, a recent Canegrowers Board teleconference saw a majority on the Board reject the package.
The growing and unified resistance of farmers is going to pose a major headache for the Queensland and Federal governments if their current package is not abandoned and the voice of farmers heeded.