Canegrowers across the NSW north coast are banking on near record sugar prices to help fund a long-term flood recovery process.
The world sugar price has swelled to its highest level in more than 40 years, reaching more than 24.50 US cents per pound in April or beyond $800 per tonne in Australian dollars.
“The world sugar price has continued to rise over the last six months,” said Sunshine Sugar CEO Chris Connors.
“Sunshine Sugar is hedging into this market with an aim of delivering over $700 per tonne of sugar for the next two years. At these prices growers will be receiving well over $50 per tonne for cane.”
“It is timely as the floods have caused significant damage not only in the mills but also in the fields.”
Sunshine Sugar owns and operates sugar mills in northern NSW at Harwood, Broadwater and Condong and a refinery co-located at Harwood. The Australian owned business is partnership between the grower-owned NSW Sugar Milling Co-operative and the Manildra Group.
NSW Cane Growers Council chair Ross Farlow said while the market outlook is “outstanding”, farmers in NSW will have to wait until at least next year to tap into the windfall.
“They are once in a generation sugar prices, but they will be out of reach for most farmers in NSW this year.”
The 2023 cane harvest season will start in late June and Ross says the yield forecast is trending in the opposite direction to world sugar prices.
“We will be at least a million tonnes of cane down this year across the three mill areas. The Broadwater mill is expected to be down by about 60 per cent decrease.”NSW Cane Growers Council chair Ross Farlow
“It is still full-on recovery mode for farmers, particularly in the Richmond and Tweed valley regions. That means we need ongoing support to keep farms viable and enable farmers to take advantage of the good prices.”
The cane crop forecast for Queensland is much brighter.
Queensland’s 2023 sugarcane crush is just weeks away, and Canegrowers Chairman Owen Menkens says the spike in the world sugar price, coupled with a drop in fertiliser prices, is setting up 2023 as a bumper year for Queensland’s sugarcane industry.
“Just two years ago the sugar price languished below $400 per tonne, not even covering the cost of production for many growers. It was a pretty grim time,” Mr Menkens said.
“Fast-forward to today and that figure has doubled, with the prompt price hitting highs of $804 per tonne in mid-April.
“The last time we saw the prompt price at $800 was in 1980, more than 40 years ago, so growers are understandably excited.”
Learn more about the historic NSW sugar industry here.