Historical sugar mill at risk despite $45m boost from taxpayers

The future of Australia’s northernmost sugar mill is in doubt, despite a $45-million taxpayer-funded handout.

In 2018 more than 100 sugarcane growers formed a cooperative and bought Mossman Sugar Mill, north of Cairns, from previous owner Mackay Sugar, which had planned to shut it down.

The Queensland and federal governments chipped in $25m and $20m, respectively, which allowed Far Northern Milling (FNM) to become the first local group in Australia to buy back a sugar mill.

The money was supposed to guarantee the future of the 127-year-old facility and help it transition from producing only raw sugar to a bio-precinct capable of making food ingredients, alcohol, green chemicals and fertilisers.

But FNM has written to growers to inform them that the mill’s future cannot be assured from next season.

Despite global sugar prices hitting record highs, FNM cited a poor crop and adverse weather conditions.

Chairperson Rajinder Singh also advised growers that they should “strongly consider their farming and operation expenditure” and forward-pricing on the next crop.

‘Absolute disaster’

Matthew Watson, whose family has supplied the mill since it started operating, said he was “devastated” to learn this might be his last crop.

“We are in probably the best position we’ve been in – in years – in terms of having the crop ready for next year, as are many growers,” he said.

“There’s a lot of money that’s been put into the ground and it would be an absolute disaster to not be able to go on.”

Federal member for Leichhardt Warren Entsch pushed for the $20m to enable the purchase of the mill and said the FNM board was not to blame.

“There has been a major problem with some of the key growers,” he said.

“They have dropped the ball in relation to production — they need to lift their game.

“The grower-owned harvesting companies were not providing the harvesting needed to allow the mill to do 24-hour harvesting, so the mill was shutting down for two and three hours a day.

“That has a major impact.”

‘Lots of little things’

But Mr Watson said growers and harvesters should not be accused of lacking effort or commitment.

He said supply challenges existed in all cane growing districts.

“There’s guys working 90, 100 hours a week,” Mr Watson said.

“It’s a big problem across the industry, we just don’t have enough harvesters.

“It’s the combination of lots of little things that have added up.

“The late finish [to crushing season] into the wet season last year really hurt us … but I can guarantee the machines are out there going their absolute best, 100 per cent of the time.”

‘Heart and soul’

Mossman Sugar Mill crushes cane supplied by about 140 growers.

After tourism, sugar is the Douglas Shire’s second-biggest industry.

Douglas Shire Mayor Michael Kerr said the mill employed workers and contractors from throughout the region.

“It is the heart and soul of Mossman,” he said.

“It’s a big economic cut that would come out of this region and our shire.”

Cr Kerr said any reduction in activity in the industry would be “pretty scary” for the town.

“The council would have to be working with the state and federal governments in looking at how we can diversify the region, if that’s what the case would be,” he said.

“It’s important to look at all avenues that we can to ensure that the mill succeeds or other options are going to be available.”