NSW Department of Primary Industries

Sugarcane

Previous years' significant flooding events continued have a flow on effect on NSW sugarcane production for 2023-24 with production 9% lower year-on-year, to just over 1.2 million tonnes. Relatively strong global prices moderated the impact of this lower production. However global prices tended to ease through 2023-24. Sugarcane's relative resilience to flooding compared to many alternate cropping or horticultural activities remains an important consideration for cane producers along the north coast while sugar prices remain supportive.

Production

Production in 2023-24 was 9% lower in volume terms from the prior year, with 1.21 million tonnes crushed across the three NSW mills. 27 The last two crushing seasons have been significantly impacted by flooding events across the growing region. For comparison the 5-year average including the 2021 season, was 1.77 million tonnes. While the total area harvested for milling was 3% lower at 12,290 hectares, the quantity of cane harvested per hectare was 6% lower at 98.4 tonnes per hectare. Limiting the impact of the lower cane production marginally was the average sugar content which, at 12.81 CCS j , was 7% above the 10-year average. In the Clarence Valley the average sugar content was 13.13 CCS j the highest reported since 1958. 43 The higher sugar content was attributed in part to the dryer conditions experienced in 2023 resulted in improved harvesting conditions compared to recent seasons. 46

A result of the seasonal conditions was a relatively short season as the industry worked through the flood impacts from the prior years. This was evidenced in Richmond region and the Broadwater mill, which was most impacted by the prior years’ flooding, as their their share of the NSW cane crush fell to 28% in 2023 compared to a typical average of a third of the state's production. 133

Price

Global sugar prices were notably strong in the early months of 2023-24 with prices peaking during October at 27.8 US cents per pound al . This supported the prices received by growers for cane. Subsequent to this peak sugar prices have declined through the latter part of the year with the average US price al decreasing 32% by end of June 2024 from the October 2023 peak. Despite this decline, in Australian dollar terms, the 2023-24 price averaged $780 per tonne, representing a 17% year-on-year increase and was 58% above the 5-year average. 63 111 Nationally, grower returns per tonne of cane were estimated to be $75, up from $60/tonne in 2022-23. 8

Australian sugar price and exchange rate

  • Spot Price (LHS)
  • Exchange Rate (RHS)
Download data (.XLSX)
Source: DPIRD (unpublished) , RBA (2024)

Trade and Market Conditions

Global annual ending stocks, net production and benchmark sugar price al

  • Ending Stocks (LHS)
  • Net production (LHS)
  • US Sugar #11 futures (RHS)
Download data (.XLSX)
Source: USDA (various) , Investing.com (2024)
NSW exports of sugar (sucrose, in solid form) are relatively minor with the value of exports totalling $4.6 million in 2023-24, an increase of 48% year-on-year reflecting in part the higher prevailing price of sugar. New Zealand remained the major market by value at $2.4 million in 2023-24 with the Philippines and Singapore also notable export markets. 79

Over the last 10 years the demand for sugar has increased relative to global supply, with an annual growth rate ar in consumption of 0.7% compared to only 0.4% annually for global sugar production. 140

In 2023-24 exports from key producers including Brazil and Thailand, increased, with Brazil achieving record production of 45 million tonnes in 2023-24, 20% higher year-on-year and with exports increasing 28% to total 36.0 million tonnes. 140 The improved sugar prices since 2021, which reached an 11-year high sugar in 2023, and recent decreases in diesel and fertiliser prices have resulted in increased profitability of Brazilian mills who have invested to lift processing efficiencies. This is illustrated by Brazil’s record production despite the area under cane being at a 12-year low. 114

In contrast, while Thailand was the second largest exporter by volume in 2023-24 totalling 10 million tonnes, exports were supported by a halving of the country's sugar stocks, as Thailand continued to struggle with dry conditions impacting cane production. Thailand producers have also been encouraged, through the provision of domestic incentives, to grow alternate crops such as cassava to meet Chinese demand, limiting sugar supply.

India is both the second largest producer and the largest consumer of sugar. Government priorities to manage domestic supply limited the share available for exports which were estimated to be 45% lower in 2023-24 which supported global prices. 140 114

Outlook

Nationally the value of the industry is expected to remain stable in 2024–25 with higher production supported by improved seasonal conditions for eastern Australia. In addition the easing of some key input costs for cropping industries, such as fertiliser, will support sugar cane production. 3 However the decline in sugar prices is expected to temper the effect of any increased production on the total value of the crop. 66

Despite the recent years' flooding impacts on sugar cane crops in NSW, the crop’s relative resilience to inundation compared to many other horticultural or cropping activities is expected to support cane production along the north coast while sugar prices remain supportive.

DPIRD Initiatives in Focus

Rangelands Living Skin

The Rangelands Living Skin project links farming families, scientists and other collaborators to evaluate cost-effective practices that focus on regenerating the NSW rangelands to support production. It creates an evidence-base for helping widespread adoption of practices that benefit soil, plants, animals and people.

Soil

The Rangelands Living Skin is a four-year project linking farming families, scientists and other collaborators to evaluate cost-effective practices – chosen by producers – that focus on regenerating the NSW rangelands to support production now and into the future. The project will create an evidence-base for helping widespread adoption of practices that benefit soil, plants, animals and people – the living skin of the rangelands. Led by NSW Department of Primary Industries and funded by Meat & Livestock Australia, the project is investigating:

  • The role of grazing management in improving soil and landscape function, including rotational grazing and high-intensity animal impact. Rotational grazing management (short periods of grazing, followed by long periods of pasture rest, with a flexible and adaptive approach) is hypothesised to improve pasture quality, ground cover and productivity. Achieving high-intensity animal impact by running a large herd in a short but intense period over hard-set soil surfaces like a clay pan will is hoped to break-up surface crusts, add nutrients and organic material to the soil and improve water infiltration.
  • The use of mechanical interventions, such as ponding, banking and ripping lines in hardened soils, to increase water infiltration and retention in the landscape.
  • Introducing new plant species, including perennial shrubs, annual legumes, multi-species crops and no-kill cropping. Perennial shrubs (old man saltbush) are sown to explore whether their deeper root systems improve soil function and pasture productivity. Multi-species plantings will be sown to explore if diverse plants (and the unique role each plant species offers to soil functionality) influences soil and landscape health. The potential of annual-hard seeded legumes to survive and increase soil health in rangeland environments will also be evaluated.
  • No-kill cropping, where forage species are sown into existing perennial grassland, is also being trialled. The hypothesis behind no-kill cropping is that the existing perennial plants maintain a functioning soil and landscape system, which allow the crops to benefit from the undisturbed soil, water, carbon and nutrient cycles and thus be more resilient challenging climatic seasons.
  • The impact of several practices related to soil amendments, including biological inputs (vermicast), biochar and gypsum, on plant growth, soil microbiology and carbon will be evaluated.

For more information click here.

www.dpi.nsw.gov.au