$400M loss: Canegrowers to finally have India dispute heard
‘We believe in a rules-based system and we are terriers when it comes to sticking up for our rights’
Mackay
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A STAUNCH advocate for Mackay and Proserpine canegrowers says they have fought like “terriers” to finally bring India to an international court.
Canegrowers Queensland chairman Paul Schembri said India’s treasury had been “blatantly” breaching trade rules to unfairly subsidise sugar producers causing a drop in global sugar prices.
Mr Schembri said Australia joined with Guatemala and Brazil to lodge a formal dispute to the World Trade Organisation two years ago but initial proceedings had been delayed because of COVID-19.
Now, the panel will convene via video conference instead of in person in Geneva.
“The WTO allows for some level of support for farmers provided that whatever subsidy is available, it organically increases the growth of an industry by no more than 10 per cent,” Mr Schembri said.
“In the case of India, they’ve gone from about 20 million tonnes of sugar (per year) to about 34 million in about five or six years.
“Their growth has been extraordinary.
“The Indian government is basically giving the producers an incentive to overproduce.”
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He said the glut was being dumped on the world market causing sugar prices to “crash and burn”, affecting 98 per cent of Australian canegrowers.
“Global prices are everything to us, we live and die on it,” Mr Schembri said.
Queensland canegrowers produce 95 per cent of the nation’s sugar, with 80 per cent of the state’s production destined for overseas.
The Proserpine, Mackay and Plane Creek regions alone accounted for more than 25 per cent of the sugarcane crushed across Australia last year.
Mr Schembri said world sugar prices had fallen from highs of $500 to $600 per tonne to below $400 a tonne — about the cost of production — costing the nation’s farmers about $300 to $400 million per year.
“Australian farmers are not subsidised,” he said.
“We have to do things differently each year, find ways of cutting our costs, be more efficient producers.
“The more we do it, all we’re getting is an international price that’s going down.
“We believe in a rule-based system and we are terriers when it comes to sticking up for our rights.”
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Global Sugar Alliance chairman and Queensland Sugar Limited managing director Greg Beashel said its members, comprising 85 per cent of the world’s cane sugar exporters, expected India to abide by its WTO obligations and abandon the subsidies.
“As demonstrated 15 years ago, after the removal of European Union sugar export subsidies,
world sugar prices quickly rise towards fair value when export subsidies are removed,” Mr Beashel said.
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