Growth Forecast for Australia's Sugar Cane Industry

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Growth Forecast for Australia's Sugar Cane Industry

20 April 2012

AUSTRALIA - The Australian sugar cane industry is forecast to continue growing its productive capacity following the almost decade-long cycle of extreme weather events (including record breaking droughts followed by cyclones and flooding).

The production and export of sugar are expected to increase sharply in 2012/13. Industry sources expect these increases to continue beyond the forecast period and into 2013/14.

While sugar prices are expected to fall somewhat in 2012/13, they are expected to remain at levels considered historically high.

Area planted to cane is expected to steadily increase in response to above-average sugar prices and a decline in competition from industries which compete for land (e.g., planted timber).

A return to “more normal” weather conditions combined with historically high prices, will likely see an increase in planted area, yield, production and exports.

Over the longer term, total productivity will likely increase to levels more reflective of the longerterm-average. However, planted area or production records are not expected to be broken as some key challenges remain for the cane sugar industry.