Australian sugar production faces delays due to strikes and heavy rainfall

Strikes and heavy rainfall across major growing areas are now delaying Australia's sugar crush, threatening exports and the ability of farmers to plant next year's crops.

Industrial action by workers in many mills stretching over months, along with a recent bout of wet weather in Queensland, is posing an increasing risk to this season's crop, industry body Canegrowers said. Some 8.5 million tons of the harvest in the state — which produces almost all of the country's cane — has been crushed so far, about 1.5 million tons less than this time last year, it said.

Australia is the third-largest raw sugar exporter, with more than 80 per cent of its crop shipped overseas. Reduced supplies from the country may help ease a recent slide in sugar futures, which recently fell to the lowest in almost two years. Australian shipments, however, are but a fraction compared with Brazil—the largest exporter—and thus unlikely to shift global prices significantly.

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Workers at Wilmar International Ltd.'s Australian mills—about half of Queensland's production—have gone on intermittent strikes for higher pay since May. That is, many growers are now unable to get into mills, weeks behind schedule, according to Canegrowers.

According to Chris Bosworth, a Canegrowers director and local sugarcane farmer, tractors and heavy equipment couldn't get into the soggy fields to transport the cane due to heavy rainfall across Queensland.

The longer the wet weather prevails, he added, many farmers just won't plant crops for next year. The later farmers plant, the more likely it is that the seedlings will be destroyed by rain as the region heads toward the wet season that usually starts in late November or early December, said Bosworth. Sugarcane crops can't be planted in wet soil.

"If you plant and the wet season rolls around a few weeks later, your crop is pretty much doomed," he said. "Many of us aren't willing to take that risk, but that also means we will have no income next year."