The first raw sugar shipment from Australia to the United Kingdom (UK) under the new Australia-United Kingdom Free Trade Agreement (A-UKFTA) was loaded in Townsville, opening up a significant new market for the Queensland sugar sector.
Tariff-free raw sugar exports to the UK have resumed for the first time in 50 years under the new deal, which went into effect on 31 May 2023, progressively growing from an initial allotment of 80,000 tonnes this year (pro rata) until tariffs are totally abolished on 1 January 2031.
The first Australian raw sugar sale under the new A-UKFTA was made by industry-owned sugar marketer Queensland Sugar Limited (QSL), which would export raw sugar produced in the Burdekin to Tate and Lyle Sugars’ refinery on the Thames in London.
QSL Chief Executive Officer and Managing Director Greg Beashel stated that the sale was backed by a united industry approach, with other Australian quota holders to the UK making their new UK quota allocation available to QSL for the milestone shipment, which effectively reinvigorates a market that was effectively lost when the UK joined the European Economic Community (EEC) common market in 1973.
“Up until that point nearly a third of Australia’s sugar exports had gone to Britain, but this came to an end when the European Union (EU) restricted our market access through relatively high tariffs, and we pivoted towards alternative markets in Asia and North America,” Beashel said.
“We’re optimistic that this sale is the first step towards reopening what is essentially a whole new market for Australian sugar producers, with Department of Agriculture, Fisheries and Forestry (DAFF) data showing the first full tariff-free quota year in 2024 could see the value of Australian raw sugar exports to the UK reach $74 million, up from effectively nothing during the past five years,” Beashel added.
CANEGROWERS Chairman Owen Menkens said it was highly satisfying to see years of hard work by Australian trade negotiators and the sector bear fruit with the first commercial shipment of Australian sugar bound for the UK in over 50 years.
“The inclusion of sugar in this free trade agreement is the culmination of a lot of hard work undertaken by CANEGROWERS and other sugar industry stakeholders, who have worked closely with the Australian Government to get this agreement in place,” Menkens stated.
According to Menkens, the market is opening up for Australian exports because growers have begun implementing the industry-led on-farm environmental management program, Smartcane BMP. He noted that UK sugar refiners Tate and Lyle have clearly wanted to source raw sugar from Australia because of our world-class sustainability credentials.
“Forty per cent of sugarcane grown in Queensland is Smartcane BMP accredited and growers across the state continue to invest in sustainability while trying to maintain on-farm profitability. I hope sugarcane growers across Queensland stand proud of their efforts in supporting the re-opening of this valuable market for the Australian industry,” he added.
Minister for Agriculture, Fisheries and Forestry Murray Watt commented, “It’s fantastic to see Queenslanders already benefiting from this Free Trade Agreement, which we hope will begin a new era for Australian sugar growers and exporters. This FTA is a win for the people of the UK who will receive extremely high-quality Australian produce, and a huge win for Australian producers and exporters who can now access new, highly lucrative markets in the UK.”
Tate & Lyle Sugars’ Senior Vice President Gerald Mason stated that the shipment from Queensland to London marked the start of a renewed partnership between Tate & Lyle Sugars and the Australian sugar sector.
“Consistent with this commitment, we’re pleased that all of the raw sugar we purchase from Australia has been sourced from cane farms that are certified against respected sustainability standards, including the Smartcane BMP program,” Mason said.
