Code of Conduct must stay in place

The Sugar Industry Code of Conduct protects growers’ ability to choose who markets their Grower Economic Interest sugar. Photo supplied

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By Joseph Borg, Chairman, CANEGROWERS Mackay

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A decade ago, Queensland Canegrowers was in the throes of a fierce defence of growers’ right to choice of sugar marketer. Now, the industry has been called to consider the future of the Code of Conduct that emerged from that industry debate.

Growers retain an interest in the sugar produced from their sugarcane, and in the 2010’s, the industry moved away from a single desk marketer model with new marketers emerging.  Some industry players wanted growers to market only through their miller.

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The situation was resolved through good support from some key politicians of the day – and particularly the then member for Dawson George Christensen – and through some strong and important industry tools including the 2015 “Real Marketing Choice” amendments to Queensland  Sugar Industry Act, then at a Federal level in 2017 with the introduction of the Sugar Industry Code of Conduct.

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The Code of Conduct requires parties to negotiate in good faith, and protects growers’ ability to choose who markets their Grower Economic Interest sugar, and provides access to pre-contract arbitration if negotiations break down.  

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This week, submissions closed in the review of the Code of Conduct, with the Australian Government to consider these and consider whether the Code be allowed to sunset as scheduled on 1 October 2027, or be retained as is, or with changes made.

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CANEGROWERS is committed to the Code being retained in its current form.

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In our view, the current Code continues to provide an essential and balanced framework that promotes fair dealing, transparency and workable commercial discipline across the sugar supply chain. The review is intended to examine whether the Code is meeting industry needs and objectives.  

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The Australian Government has described the Code as supporting fairness and transparency in commercial arrangements, and that objective remains as important today as when the Code was introduced in 2017.  

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The underlying market conditions that justified its introduction have not disappeared. In most cane-growing regions, growers cannot simply switch counterparties if negotiations fail. Cane is perishable, harvest windows are tight, and freight economics limit alternatives.  

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In that setting, the Code performs an important public policy function by establishing minimum rules of conduct and a framework for resolving bargaining impasses. Those protections are not redundant; they are fundamental to a fair negotiating environment.  

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Importantly, the current Code is not an excessive or unworkable intervention. It does not remove commercial risk, guarantee outcomes, or prevent parties from pursuing their legitimate commercial interests. Rather, it sets baseline expectations for conduct, transparency and process in circumstances where bargaining power is uneven. In our experience, that balance remains appropriate.  

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The Code provides a disciplined structure for negotiation while still allowing commercial parties to reach outcomes that reflect local conditions and business realities.  

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It is critical that the Federal Government upholds this important industry tool, allowing us to retain the Australian sugar industry’s good reputation as an equitable, stable player in global sugar trade.

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