Sugar prices are on the way up.
Sugar prices are on the way up.

Sugar prices still need lift

CANE farmer Peter Muscat finds it hard to get excited about a brighter sugar price outlook.

He needs the price to climb higher.

"Where they are now is barely enough to scrape by," he said, explaining his frustration.

"They can be much higher. It needs to be better for our (farmers') sake."

The price has rallied in the past week.

On Friday, Queensland Sugar Ltd listed the price at 14.24UScents a pound ($A416.21 a tonne).

Mr Muscat said the crop he cut last year wouldn't reap the rewards expected.

"We aren't going to have much to show for it come the start of the crush this year," he said.

Due to the increase in production costs associated with cane farming, Mr Muscat finds it hard to be happy about the current situation.

"Everything is getting more expensive. Despite them telling us it's better and getting better, we can't see it," he said.

"We need to make more. If we get $100, for example, $90 is spent on going back into everything else.

"I employ people and you have other costs associated with your farms."

Electricity costs are a big factor for Mr Muscat because there hasn't been sufficient rain in the region.

"I need it to rain more. We need more so we can get a good crop and keep it moving forward," he said.

"You are spending so much money on irrigation it drives your power costs up.

"Every time you go to turn on the pump you shudder because you think about how much it will cost."

Canegrowers Mackay chairman Kevin Borg said the high sugar price was "really good news" for growers.

"It was good to see the price rally two nights ago," he said on Friday.

"The price has been down in the doldrums for a while."

Mr Borg said from what he could gather a deficit of sugar was now being forecast.

"The oversupply they thought was there seems to be dwindling now - that seems to be what has pushed the price up," he said.

The key now, Mr Borg said, was to have the price rise more and maintain that level.

"Fourteen cents is about the break-even price so we'd like to see it a bit higher and hold there," he said.

"We're hoping for another rally."

Mr Muscat is hoping the prices will increase further to ease the pressure.

"This is how we make a living, this is our way of life and you can only cut back so much before you will have nothing left," he said.

QSL predicts an increase in prices throughout 2016 into 2017 and expects consistency in where the prices are now.



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