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25 January, 2021

Positive signs for a good year in sugar


Kevin Borg, Canegrowers Mackay.

AT the Canegrowers Mackay’s AGM, Chairman Kevin Borg said the sugar industry had started the year on a positive note, after a better than expected result in 2020.

“At this time last year, the crop was looking grim in parts of the region but good rain at Christmas 2019 and follow-up winter rains at the beginning of the crush in June 2020 saw Mackay Sugar crushing 5.15 million tonnes of cane (2019: 4.67 million tonnes) and Plane Creek, 1.23 million tonnes of cane (2019: 1.14 million tonnes),” said Mr Borg.

“The finish date for Plane Creek was November 20 and the last Mackay Sugar mill crushed out on 10 December. The later finish for Mackay Sugar was not ideal for those growers, however we have plenty to rejoice in that the weather held up long enough to remove the whole crop.

“Hopefully Nordzucker’s ongoing investment in milling performance will see an increasingly reliable result and an earlier finish in the not-too-distant future.”

Sugar content was again better than expected with Mackay Sugar averaging at 14.14 (2019: 14.33) and Plane Creek at 14.23 (14.69).

“Although we did see a dry end to the crush it was heartening to see the condition of the fledgling 2021 crop towards the end of 2020. The earlier winter rain set us up with good moisture so that ratoons and plant cane were well established before the wet season set in at Christmas time.

“Recent rain has varied across the district in recent weeks but it seems that all farms have had enough to sustain the fledgling crop for some time to come. The sunny days following the rain have helped maximise growth rates and most crops now have reached the ‘out-of-hand’ stage (more than 100 cm or three feet tall).”

Mr Borg said last year growers had the opportunity to lock in prices of around $460/tonne of IPS sugar in early 2020.

“It has also been encouraging to see sugar prices rally in the last few weeks, thanks to speculators’ optimism that there will be a deficit in global sugar stocks of around 5-6 million tonnes for the year.

“All growers should be forward pricing the amount of sugar they are allowed to trade on the market when the price is high.”

Dougall Lodge, a sugar marketing expert for CANEGROWERS’ Marketing Information Service was guest speaker at the AGM and talked about the benefits to cane farming businesses of taking advantage of forward pricing, an opportunity not available to any other cane growers in the world.

 


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