Trade

CANEGROWERS meets regularly with Australia’s Minister for Trade and senior government officials to ensure trade issues affecting sugar are fully understood and to support Australian Government efforts to secure a more favourable and profitable export market environment for Australian sugar. The organisation played a key role in advising the Australia Government on recent free trade agreement negotiations with the European Union and United Kingdom.

CANEGROWERS works closely with Queensland Sugar Limited (QSL) and collaboratively with the Australian Sugar Milling Council to improve the terms of trade for Australian sugar and coordinates and manages the activities of the Global Sugar Alliance of exporting countries with a like-minded approach to trade policy.

A-UK FTA: Australia recently successfully negotiated a Free Trade Agreement with the United Kingdom (A-UK FTA). This agreement has allowed commercially meaningful access for Australian sugar to the UK market. Through the FTA, Australian access is a structured progression from an initial 80,000 tonnes in 2023, increasing on 1 October each year by 20,000 tonnes for eight years after which there will be open access to the market. It is important that Australia maintains a diversified export portfolio of sugar markets in order to manage access risks over time. The first shipment of sugar to the UK in over 50 years arrived in London in September 2023. Subsequent cargoes have been contracted, with the UK refiner seeking to purchase high quality, sustainably produced Australian raw sugar produced from BMP Smartcane sugarcane.

A-EU FTA: The negotiation of an Australia-EU FTA stalled with agricultural products being a major impediment to reaching a deal. While the terms for access for sugar were unsatisfactory, those for beef, lamb, dairy products, and wine were also disappointing. The Australian government, with the support of CANEGROWERS determined that it would be better to walk away than to accept a substandard arrangement.

World Trade Organization action: In 2023, the World Trade Organization (WTO) ruled that India’s domestic support policies on sugar were distortionary. India has appealed the decision. Australia, with support from the Global Sugar Alliance, continues to apply pressure at the WTO to enforce compliance, as well as to restore the WTO dispute settlement system and appellate body. However, India’s subsequent policy decision to switch its supports from sugar to ethanol has eased the pressure on world sugar prices. The development of India’s ethanol production capability serves two purposes. It reduces their level of sugar exports, and it lowers emissions. India recently announced restrictions on sugar exports to boost domestic supplies following a poor crop.

ATMAC: CANEGROWERS secured funding through the Department of Agriculture, Fisheries and Forestry (DAFF) for its Agricultural Trade and Market Access Cooperation (ATMAC) program. The ATMAC program supports CANEGROWERS ability to validate Australia’s sustainable sugarcane production credentials and has mapped opportunities to enter new markets for raw sugar in Asia and elsewhere based on contestable market share, market size, potential returns and considering regulatory and counterparty risks. This has also provided recommendations on relevant trade policy settings required, and an engagement strategy for pursuit of those markets. The program has examined potential new market opportunities for value-added bio-products for the industry based on an analysis of attractiveness and risks, technical and market access issues, and Australia’s comparative advantage.