Miller Wilmar and marketer QSL will reconvene for mediation later this week, in a bid to resolve the final obstacles before the start of the 2017 crush.
It’s the second time the two entities – who have been locked in a battle about on-supply agreements since 2014 – have turned to mediation.
The state government funded the first mediation in March.
Late Monday afternoon Wilmar representative John Pratt said Wilmar would seek further mediation as the two parties could not agree on a provision in the GEI Sugar Sales Agreement.
He said the miller met with QSL last week “in the hope of wrapping up a GEI Sugar Sales Agreement”.
“Unfortunately, QSL objected for the first time last week to a provision that has consistently appeared in documents exchanged between Wilmar and QSL since October 2016 without any concerns being raised,” Mr Pratt said.
“We were unable to resolve the issue and so we asked for urgent mediation and with QSL’s agreement we are contacting Mr Richard Chesterman QC to ask for his assistance as soon as possible.
“Be assured we want this last minute obstacle removed as soon as possible.”
But QSL managing director Greg Beashel said during negotiations it emerged that Wilmar was seeking to redefine GEI Sugar and, as a result, deliver less tonnes of sugar to QSL at the start of the season.
“Under their proposal, Wilmar is seeking to deliver GEI Sugar tonnage to QSL calculated on actual CCS rather than relative CCS, and change the way cane payments are calculated – a major departure from standard industry arrangements, including all of Wilmar's previous Cane Supply Agreements (CSAs) and the way we understand all other milling companies pay growers,” Mr Beashel said.
“Such a change would result in lower advance payments to Wilmar growers choosing QSL and less sugar for QSL to market during the early months of the harvest.
“We strongly refute Wilmar’s claim that this position was consistently in documents provided since October 2016.
“It has never been the subject of any of the negotiations between QSL and Wilmar prior to Wilmar providing a first draft of the OSA following the mediation.
“We remain convinced that the implications of this significant change are not in the interests of the industry we serve, nor those Wilmar growers who seek to access marketing choice they have fought so hard to secure.”
The mediation is believed to be happening on Thursday.
