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Wednesday, 12 September 2018
Page: 8866


Mr CHRISTENSEN (Dawson) (19:55): Around the country, there's a lot of focus on our farmers, and rightly so. Agriculture has been the central pillar of our economy. Much of Queensland and New South Wales in particular are in drought. While we've seen some rains, we need to see a whole lot more. Although my electorate is not drought declared, it has been extremely dry, particularly around the Burdekin, where sugarcane farmers are paying extraordinary power bills for pumping water for irrigation.

Any kind of farming is a tough job. Farmers are always at the mercy of the weather. They're often at the mercy of market prices, and, because 85 per cent of Queensland sugar is exported, cane farmers are at the mercy of world prices. They are sometimes at the mercy of government policies and even the policies of governments in other countries when they impact on subsidisation or foreign exports. Right now, for instance, sugarcane farmers in Australia are suffering because the world price is lower than the cost of harvesting. That comes about because other countries—India and Pakistan, for instance—have subsidised their farmers to overproduce and then dumped the excess sugar on the world market.

Farmers are also often at the mercy of a monopoly, as is the case in the sugar industry. Cane farmers must have a mill to send their sugar cane to in order for it to be milled, and normally there is only one mill that they can send it to. That gives milling companies, most of which in my electorate are owned by foreign multinationals, an unhealthy level of power when it comes to negotiation on matters such as price. The power that was wielded ruthlessly by Singaporean multinational Wilmar, when it announced in 2014 that it would sell all of its crushed sugar cane through its own marketing arm, was immense. Farmers feared, rightly, that the prospect of this multinational selling their sugar on the world market, when the company that owned the mill was itself the dominant player in the trading exercise, could mean lower prices for their crop.

When I raised those concerns with the then Prime Minister, the member for Warringah, he asked me to set up a sugar-marketing task force. I was the chair of that task force, which conducted consultations extensively with farmers, milling companies and other stakeholders in the industry, and we made recommendations to the government, which included establishing a code of conduct for the sugar industry. The government then went about creating that code and set a date for its operation to be reviewed, with the view that, if it needed to continue, it could be enshrined in legislation. This is where we are now.

Last week, the government held briefings in the Burdekin and in Mackay, the two largest sugar-growing districts in Australia, both in my electorate. As it is the middle of the crushing season, I was surprised by the large number of farmers who took the time out of their busy schedule to attend these forums. That just highlights the importance of this code of conduct to their future. The feedback from those farmers was that the code was essential for the survival of their industry. In addition to the briefings, other stakeholders have presented their views in submissions to the review process. One such submission, and a very important one, is from the Australian Competition and Consumer Commission. I say this submission is important because critics of the code have argued against it on the grounds of its effect on competition.

The ACCC has confirmed what farmers already knew: that the code should be kept in place because it's an appropriate means of addressing the lack of competition and the unfair power that these foreign-owned milling companies actually wield in negotiations. The ACCC's recommendations are that the obligation upon mill operators to provide sugarcane growers with grower choice be activated in the code and that civil pecuniary penalties and, thereby, infringement notices be introduced for all breaches of the code. The department will take heed of the ACCC's submission and, indeed, all submissions made through the review process, and they're going to present their recommendations to the Minister for Agriculture and Water Resources in November. The minister will then take the appropriate actions, and I understand the minister intends to complete that process without delay.

As someone who first brought this issue to Canberra and who oversaw the initial consultation process with farmers through the task force, I'm very proud to say that the Liberal-National government listened to the concerns of the community and of farmers and took action. I'm now seeing the positive response that action has received on farms around my electorate and around the state of Queensland, in particular. I have confidence that the success of the sugar code of conduct will see it remain as the chief mechanism to bring fairness back to the farms and to give sugarcane farmers a fighting chance for their future.

Debate interrupted.

House adjourned at 20:00