Anger over 4th Cane Payment

[posted 19 May 2010, 1545]

Cane farmers are extremely angry with the 4th cane payment for the 2009 season announced by the Sugar Tribunal as it dips into farmers’ proceeds from coming seasons to make up for a gross shortfall in 2009 forecast price.

As per the forecast price, growers were expecting a full payment of at least $71 per tonne for their 2009 cane. Instead, they received $56.26 a tonne resulting in a shortfall of about $15 per tonne.

The Tribunal has just announced a $6 per tonne fourth cane payment for the 2009 season. This will comprise the actual 4th cane payment of $2.26 a tonne for the 2009 crop and an additional “special” payment of $3.74 per tonne.

The additional payment will come from a loan by Sugar Cane Growers Fund to the FSC, which will be recovered from proceeds from the 2011 and 2012 seasons.

But farmers had not asked for a special payment. They are seeking compensation for the loss suffered as a result of gross inefficiencies in FSC’s milling process during the 2009 crushing season with almost half the cane supplied being dumped as wasted juice.

“FSC is just making a complete fool of the cane farmers. What this actually means is that farmers are fronting up with 70% of the money to pay themselves,” said Surendra Lal, secretary, Labasa Branch of the National Farmers Union.

“The ‘special” payment is completely unlawful, in direct contravention of the sugar industry Master Award,” Mr. Lal said.

First of all, the Sugar Industry Tribunal has no authority to announce a special payment for farmers. Cane farmers have not asked for any special payment. Nor has the Sugar Cane Growers Council.

Secondly, the Growers Fund has no right to be giving a loan to FSC which is an insolvent corporate entity, and it is well known that none of the commercial banks are willing to lend to FSC.

Farmers had petitioned the Tribunal for compensation for the huge loss suffered by them as a result of FSC’s failure to keep its mills in good repair as required under the Master Award.

This loss has to be made good by FSC as compensation to growers. There is no question of a special advance payment from the growers own fund and proceeds.

Farmers are not fooled. The NFU warns that the sugar industry will definitely sink if growers are going to be robbed and cheated in this manner.