THE Australian Sugar Milling Council says LNP demands for Wilmar Sugar and Queensland Sugar Limited to reach agreement on sugar supply contracts are primarily motivated by the growing popularity of One Nation, and are putting the entire sugar industry at risk.
ASMC chief executive officer Dominic Nolan said the LNP should withdraw its threat to Queensland Sugar Limited and Wilmar and let the commercial processes that were underway run their course.
LNP leader Tim Nicholls announced on Tuesday that Wilmar and QSL had 48 hours (3pm today) “to agree to resolve their long-running dispute by February 28”. Mr Nicholls said if Wilmar and QSL did not provide an iron-clad guarantee that negotiations would be finalised for supply and on-supply agreements by that date, the LNP would introduce legislation to amend the Sugar Industry Act.
Representatives from both Wilmar and QSL are meeting this afternoon. As of 5pm it was unclear if the two companies are any closer to agreeing to the LNP deadline.
Wilmar is the only one of the seven milling companies not to have reached agreement with QSL, leaving some 1500 growers that supply the eight Wilmar mills in limbo. It is understood unlike the other milling companies, extraordinary demands have been placed on Wilmar.
However, it is the threat of a mandatory arbitration process that would again regulate the deregulated industry that has the ASMC extremely worried.
“If the LNP leadership had bothered to check with QSL and Wilmar before their announcement on Tuesday, they would have discovered that the two parties had made significant progress in their negotiations in recent days and were close to agreement,” Mr Nolan said.
“This latest political offering of further intervention has the potential to work against achieving a commercial outcome in the short term.
“And introducing yet another pre-contract arbitration process into the industry – that does not exist for any other commercial context in Australia – would guarantee extended delay to reaching an agreement. This puts politics ahead of Queensland families and Queensland jobs.”
Mr Nolan said the LNP was putting at risk jobs and investment across regional Queensland.
“The direct economic contribution of the sugar industry to Queensland in 2016-17 will be in excess of $4 billion across growing, milling and refining activities,” he said. “The milling sector alone will be more than $2b.”
Despite the seemingly having the overwhelming support of Queensland’s more than 4000 growers, Mr Nolan said all mills had opposed the 2015 legislation that the LNP supported.
“It was flawed from the start,” Mr Nolan said. “Mills were not consulted and identified from day one the many failings of the political interference. Despite this, with that legislation in place all mills have done everything possible to progress commercial arrangements with growers and marketers ahead of the 2017 season,” Mr Nolan said.
“I want to stress in the strongest terms that this political intervention is moving the sugar industry steadily back to the regulated days gone by, despite the fact the industry was paid $500 million out of the Australian taxpayers purse in the mid-2000s to deregulate.
“Our industry is still feeling the negative impact of the flawed legislation sponsored by the LNP in 2015, we have absolute bitter experience that political intervention doesn't solve anything, and we are once again caught up in politically motivated policy on the run.”
Mr Nolan’s comments were endorsed by Premier Annastacia Palaszczuk who said the ASMC statement was a damning indictment on the LNP and its impact on jobs and investment in regional Queensland.
However, the LNP imposed deadline has been supported by peak farm group CANEGROWERS and sugar marketer QSL. Burdekin cane farmers were also in Canberra today attempting to gain support at the federal level. CLICK HERE to read that story.