OPINION: When Queen Elizabeth II revived the phrase 'Annus horribilis' she clearly did not have the Queensland sugar industry's 2019 year in mind, but an apt description it most certainly is.
However, another Latin phrase 'de minimis' has been most relevant to our fortunes this year.
It describes the level of subsidies the Indian Government must not exceed as part of its entitlements under WTO rules, but which it's exceeded in breathtaking fashion.
As a result, global sugar prices are well below the cost of production for even the most efficient producers such as Australia.
For the global sugar community, winning isn't everything, it's the only thing.
- David Pietsch, ASMC
After the Australian Sugar Millers Council first raised the alarm in 2018, and following 20 months of analysis, consultation and process, the recently commenced WTO dispute will be the 'main event' to watch in 2020.
For the global sugar community, winning isn't everything, it's the only thing.
On top of the price malaise, Australian sugar production has fallen by around 13 per cent off the back of a large drop in the sugarcane crop due to poor 2019 growing conditions.
Despite these challenging times, however, there is considerable room for optimism. Our industry is a success story for two-way trade and investment.
We earn $1.5 billion per year in export income, and have attracted more than $2b in much needed foreign investment in our milling companies over the past decade.
Given our reliance on exports, market access is essential to enhance our sector's future prospects.
Sugar missed out on the benefits obtained for other commodities in recent trade agreements, particularly with the US and China.
To secure the sugar sector's future viability we have high expectations for trade deals with the UK and EU.
Domestically, much of the miller and grower leadership accepts the need for heavy lifting, commercially and structurally, for the industry to continue to be a mainstay of the economy.
We hope governments will also recognise the increased burdens they have placed on the industry and will seek to provide greater relief and support.
Regulations and/or charges in marketing, electricity, water, port access etc. make it more difficult and costly for us to operate.
One hopes we'll look back to see 2019 as a modern-day nadir, and that 2020 signalled the commencement of relief from regulatory burden, global overproduction, and a return to profitability for Australia's sugar producers.
- David Pietsch is the chief executive officer of the Australian Sugar Millers Council.
