Cane production is expected to be higher than last year, but there is only a marginal improvement in the cane's sugar content due to the extremely wet conditions and the impact of more than two million tonnes of standover cane, which could not be harvested in the previous year. The liberalization would ease the financial pressure on the Australian cane growers. Most of the wage workers are in the factories, since cane farms are mainly owned and operated by family farmers. In late June the central government announced its intention to impose tighter controls on sugar imports, after complains by domestic producers of unfair competition from cheaper imports. According to regulations, local producers must deliver 40 percent of their production to the government at fixed prices for distribution among the poorer sections of the population, while the remainder is sold at free market prices.
Producers maintain that the price for the levy sugar is well below their cost of production.
In February, the government raised the sugar import duty to 27.5 percent from 5 percent, but failed to halt the influx of imported sugar. In late July, in the first move after the June amendment to the Sugar Control Order, the government asked all traders to inform every fortnight the food ministry about their stockholding position as well as the amount of sugar they expect to receive. This will facilitate the government's task of estimating the country's actual sugar position. There are some 75 sugar traders selling in the domestic market, about 30 of them have large operations, while the rest are said to be in the business only sporadically. Import controls could bring some relief to domestic producers in the context of a bumper crop and the estimated 5.2 million tonnes of sugar stocks.