Sweet news for growers
By JURIS GRANEY
THE local cane industry has entered 'a new world of sugar trading' with sugar prices reaching close to 10 cents per pound, Clarence Cane Growers Association president Vince Castle said this week.
Mr Castle said the dramatic rise in world sugar prices was due to various international incidents and was not expected for another three to five years.
London-based LIFFE futures exchange shows refined sugar is trading at 9.95 cents per pound, a far cry from previous season where prices plummeted to below six cents.
"We never expected, although we had hoped, for prices to return to this level," Mr Castle said.
"There are three countries who are causing the tightening of supply, Pakistan, Russia and China."
An appeal by the European Union to overturn an independent commission's decision to slash the amount of heavily subsidised sugar they dump onto the world market, was also a major factor in the global rise of sugar, Mr Castle said.
"The European Union is now being forced to slash the amount of sugar on the world market by four million tonnes," he said.
"They are planning to cut back production by 39 per cent over two years.
"This is great news for smaller providers and it really is a new world of sugar trading."
Mr Castle said a decision by Brazil, unequivocally the world's most proficient sugar producer, to redirect some of its cane into ethanol production in the wake of skyrocketing oil prices, would also offer a windfall for producers.
Mr Castle said excess sugar from last season, as well as some sugar from this year, would be shipped to Singapore and Indonesia, with the first load set to leave Brisbane within the next month.