Sugar stance welcomed in North

India reported to WTO for unjust sugar subsidies


North Queensland growers have welcomed the WTO challenge.

North Queensland growers have welcomed the WTO challenge.

Aa

Canegrowers and millers have applauded the Australian Government for putting India on notice with the WTO for dumping subsidised sugar on the global market.

Aa

SUGAR cane growers and millers have applauded the Australian Government’s stance to officially challenge Indian policies which has seen mass amounts of sugar dumped on the world market.

The Federal Government overnight lodged a ‘counter-notification’ with the World Trade Organisation in Geneva over the Indian dumping, which has contributed to cripplingly low world sugar prices.

Canegrowers Chair Paul Schembri congratulated the Australian Government for taking a lead role in ramping up the global pressure on India.

“By lodging a Counter-Notification Notice with the WTO, Australia is flagging that this is a serious issue of significant concern at the highest global level,” Mr Schembri said.

“While this notice does not resolve the problem of subsidised Indian product distorting the world sugar price, it takes the very real difficulties of Australian farmers into an international forum and places further pressure on the Indian Government to change its sugar policies.”

The notice calls into question the historic and ongoing payments being made to Indian farmers in excess of allowable supports under WTO rules.

“WTO rules allow market price supports of up to 10 per cent of the total value of production but the Indian payments in recent years have been above 90 per cent, even hitting 99.8 per cent in 2015-16,” he said.

The notice covers price supports provided by the Indian Government to its sugar industry between 2011-12 and 2016-17 which totalled more than US$51 billion.

“India’s ongoing and blatant disregard of the rules is having serious implications for the world sugar market and the profitability of Australian growers who are totally exposed to the global sugar price,” Mr Schembri said.

Herbert River Canegrowers chair Michael Pisano said he was pleased the government had listened to lobbying and had lodged the counter notification.

“It shows that the government is taking this matter seriously,” Mr Pisano said.

“We've done this once before when the EU were dong something similar and had successful outcome.

“It takes a long time but it is something we need to do to send the message to other countries that we don’t believe people should get away with breaking the rules of world trade.

“We don’t want to get into trade wars, but when this happens it distorts the world price.”

Mr Pisano said the matter was particularly important for Herbert growers, where 100 per cent of sugar went to the export market.

“80 per cent of sugar produced in Australia is exported and that’s 100 per cent on the Herbert. We depend on the world market price of sugar and don’t like to see anything that creates this artificial pricing.”

Burdekin Canegrowers Phil Marano said he was confident that other sugar exporting countries would join the protest now the Australian Government had taken the first step.

However, he said while it was unlikely to be a quick fix, the move put Indian on notice.

The Australian Sugar Milling Council (ASMC) joined the chorus, saying the market was currently awash with subsidised sugar and the subsequent low prices were causing hardship to the Australian sugar industry.

ASMC’s Director of Economics, Policy and Trade, David Rynne said industry analysts had estimated the Indian Government’s mandated 5 million tonnes of subsidised exports would result in revenue losses of $360 million for the Australian sugar industry in 2017-19.

“With world sugar prices already depressed, these additional subsidised exports from India will exacerbate the Australian industry’s operating losses,” Mr Rynne said.

“Further adding to the potential losses would be the situation where these subsidised exports were displacing Australian sugar from a number of our traditional markets.”

The notice will be considered during the WTO’s Agriculture committee meeting on November 26-27.

Aa

From the front page

Sponsored by