Cane growers strike at 2023 Sugar Terminals Limited AGM

A major shake-up that “eroded trust” between Queensland cane growers and the sugar terminals has yet to be resolved with a strike at the company’s AGM and failed discussions. DETAILS

A major announcement that “broke trust” between Queensland cane growers and the sugar terminals has yet to find solutions with a strike at the company’s AGM and failed discussions. Picture: Contributed

A stoush in the sugar industry that started at the beginning of the year isn’t on the path of resolution with industry shareholders striking at the last annual general meeting and the port operating company stating they won’t budge.

Sugar Terminals Limited announced in January this year that they would take control back of the operations of their terminals in Queensland which has led to outrage among industry shareholders.

The company has severed their 20-year relationship with Queensland Sugar Limited, that had been operating its six sugar export terminals since 2000, by announcing the they would insource operations by June 2026.

STL effectively would sack QSL from operating the terminals in Cairns, Mourilyan, Lucinda, Townsville, Mackay and Bundaberg and be both owner and operator of sugar terminals.

STL chairman Mark Gray had told this publication the decision stemmed from the need to increase efficiency, and reduce costs within the operation of their terminals, while Canegrowers Mackay chairman Kevin Borg argued STL could not operate the terminals more efficiently.

Canegrowers chairman Owen Menkins told this publication that a number of shareholders had tried to find common ground with STL, asking for an independent review of the company’s business plan or asking for a mediator to get involved in discussions, all to no avail.

QSL Chief Executive Officer and Managing Director Greg Beashel and Canegrowers chairman Owen Menkins, oversee Australia’ first raw sugar shipment to the United Kingdom under the New Australia-United Kingdom Free Trade Agreement at Townsville port. Picture: Shae Beplate.

“The relationship is very toxic,” Mr Menkins said.

“The reality is, the management of these terminals is something that is very close to the hearts of growers, who funded two-thirds of their construction.”

STL has held their Annual General Meeting in Brisbane on November 22, where they sustained a first strike on their remuneration report, with 30 per cent of their shareholders voting against it while 75 per cent of yes votes were needed for the report to pass.

A new grower director, Steve Kirby, was elected while the company’s miller director, Rohan Whitmee, was re-elected.

QSL CEO Greg Beashel said Mr Kirby was the preferred candidate of QSL and said he firmly believed that he will “not only be a strong Voice for growers’ interests but will work hard to ensure STL’s objectives are closer aligned with those of the industry it was created to serve”.

Aerial view of the Mackay Bulk Sugar Terminal. Picture: Sugar Terminal Limited

Mr Beashel said the strike vote on the remuneration report had been a way for partners to express their disagreement, with the “general feeling” among canegrowers that insourcing operations was a “really, really bad decision” that “needs to be changed”.

“QSL was there to keep them honest in their ways,” Mr Beashel said.

“QSL is a tax free entity, we don’t have a margin to the terminal operations and we’ve had a lot of experience doing it, so we think there’d be a lot of risks and costs, not just for ourselves because we’re the biggest users of the terminals but also to the rest of the industry.

“There’s no regulation of this monopoly at the moment because QSL is the operator, it’s one of the key reasons the industry is happy with the arrangement.

“But when there’s an unfettered monopoly, people worry about all sorts of things: what are the prices going to be, what about the transition costs and risks?”

Inside the sugar sheds at Mackay Sugar Terminal. Picture: Contributed

“They’ve had some very strong feedback now … so you would expect that the board organisation would step back and have a look at how they should respond to it,” Mr Beashel said.

STL CEO David Quinn said the decision to insource operations was not the subject of any resolutions or vote at this year’s AGM but he acknowledged that the outcome of the vote on remuneration had been influenced by QSL’s objection to the board decision.

“The outcomes of this year’s AGM do not impact STL’s commitment to implementing insourcing terminal operations for the benefits of the entire sugar industry,” Mr Quinn said.

“STL remains committed to engaging with growers and other industry stakeholders, listening to concerns, answering questions, and collaborating to ensure we are delivering for the entire sugar industry.”

Mr Beashel said if none of the discussions were fruitful, shareholders would consider striking at the AGM’s vote for a second time next year.

CORRECTION: This article previously stated that the insource operations had not been discussed at the AGM, which was incorrect.