What shock industry decision could mean for Bundaberg sugar growers

An unexpected and unforeseen decision by Sugar Terminals Limited may have a negative impact on the future of the Queensland sugar industry and its international connections.

As farmers such as Wayne Baldry (pictured) continue to battle inconsistent weather and rising commodity prices, massive export changes are a cause for concern. Photo: Paul Beutel

A recent industry shake-up may have long-term effects on the state’s sugar industry as not-for-profit operator Queensland Sugar Limited has been abruptly pushed out of terminal export operations.

The move came as a shock to the industry when the announcement was made on Monday that Sugar Terminals Limited would in-source all operations of its Queensland bulk sugar terminals.

QSL CEO and managing director Greg Beashel said the termination to the longstanding and beneficial agreement came as a surprise, with no consultation or advice from STL.

“We are disappointed that STL would take such a unilateral action providing only vague and inaccurate justification in their public announcements,” Mr Beashel said.

About 150 casual and permanent employees will now be left with unclear futures as the three-year contract run-off period edges towards a close.

The Queensland sugar industry has competed against international markets backed by government subsidies, with terminals such as the one pictured in Bundaberg a key cog in the shipping wheel. Photo: Vanessa Hunter/The Australian

Bundaberg one of six locations affected by the announcement, where more than two million tonnes of sugar is stored for year round Australian and international delivery.

The media announcement from STL – which was published within hours of QSL received their termination notice – stated their reasoning behind the decision was driven by a “clear conflict of interest.”

“Unnecessary duplication exists due to the allocation of costs incurred from the QSL Board, Executive, support functions, insurance policies and auditing requirements, among others,” STL chair Mark Gray said.

Mr Beashel has said the decision was “breathtakingly arrogant” for a company that has no experience running sugar terminals.

“QSL is set up as a not-for-profit industry service organisation, and all the benefits arising from that are now put at risk,” he said.

With sugar prices reaching record highs following a wet harvesting season, industry leaders have been left reeling over changes to international market dealings. Photographer: Eric Taylor/Bloomberg

Canegrowers have called for STL to explain their decision and why growers and industry stakeholders weren’t consulted.

Canegrowers chairman Owen Menkens said the bulk sugar terminals which gave Australian sugar an edge over international competitors were funded by grower investments.

“These terminals are industry assets allowing Australian sugar to be traded as a reliable, high quality, sustainable product into our most valuable markets in a timely manner,” Mr Menkens said.

Regional growers and representatives have been left reeling, with local industry stakeholders still unsure of how the decision will affect the sugar industry at a grassroots level.