AUSTRALIA: Sucrogen extends contract with QSL for three years
Published: 07/04/2012, 8:38:40 AM
Australia's Queensland Sugar Ltd. will continue to market most of the state's raw sugar meant for exports in the coming years after six milling companies including Sucrogen extended their raw sugar supply agreements until June 30, 2016, according to Dow Jones.
QSL Chief Executive Greg Beashel said the Brisbane-based marketer has agreements in place with the six millers that have opted to roll over their contracts for a fresh 3-year period.
"We are pleased that we now have confirmation of their choice to continue partnering with QSL," Beashel said in a statement issued late Tuesday, without naming specific sugar mill.
A spokeswoman for Sucrogen, later confirmed to Dow Jones that the company had extended its marketing arrangement with QSL, but declined to give further details.
The new contracts take effect from the 2013/14 fiscal year as the current year is still covered by the previous contract.
Sucrogen is Australia's biggest sugar company and produces more than 2 million metric tonnes of raw sugar a year, accounting for more than 40% of the national output. It is now a unit of Singapore-based Wilmar International.
The raw sugar supply agreements are the supply contracts that allow QSL to pool raw sugar from mills and market it for export. Mills contract to supply raw sugar to QSL on a three-year basis.
"There is ongoing strong demand for Australian raw sugar in the Asian region and our focus is on continuing to maximise returns for all our members through our value-adding activities in pricing, financing, marketing and logistics," Beashel said.
QSL didn't provide further details.
Australia's raw sugar exports will rise this year, underpinned by an expected increase in domestic output, the Australian Bureau of Agricultural and Resource Economics and Sciences forecast late June.
Exports are expected to rise 12% this fiscal year started July 1 to 3.35 million tonnes, but its value may fall 10% to A$1.51 billion (US$1.55 billion) due to lower global prices, Abares said in its forecast.
Raw sugar production in Australia, generally the world's biggest exporter after Brazil and Thailand, is expected to rise 18% this fiscal year to 4.40 million tonnes, due to an expansion in the area harvested and an expected increase in yield after a run of poor seasons, Abares said.
Queensland accounts for more than 90% of output from Australia, usually the third largest supplier to the global trade after Brazil and Thailand.