Rogers Sugar Inc T.RSI

Sugar prices on the rise

[spazzman]

Here is a copy of an article I read in todays Wall Street Journal


Sugar industry takes $500m hit from Cyclone Yasi
Sarah-Jane Tasker
From:The Australian
February 04, 201112:00AM

QUEENSLAND'S sugarcane industry, the world's third-largest exporter, is facing a loss of more than $500 million from the destructive path of Cyclone Yasi, driving the sugar price to a 30-year high on supply concerns.

The state's banana crops, which account for 85 per cent of the country's production, have also been severely hit by the cyclone, which made landfall at Mission Beach at midnight local time yesterday (1am AEDT).
But fears of further damage to the massive mining industry eased yesterday, as it was revealed the coal sector -- still recovering from the devastating floods in January -- was unlikely to face further delays because of the tropical cyclone.
Rail and port infrastructure that service the state's main exporters was reportedly not badly damaged by the strong winds and heavy rainfall.
Canegrowers chief executive Steven Greenwood said the affected region usually produced revenue of around $1.5 billion a year.
"Many sugarcane growers in far north Queensland have lost everything -- house, crop, machinery and livelihood in the devastating force of the cyclone," he said.He said the north Queensland growers would again bear the brunt of losses.
"We've had reports from sugarcane farmers in and around Tully of crops that have snapped in half and whole farms that have been completely flattened.
"Trees are uprooted, roofs are missing and power poles are now lying as flat as the sugar cane," Mr Greenwood said.
He said 30 per cent of Australia's crops were grown north of Townsville, which was in the cyclone's direct path.
He said while it was too early to assess the full damage bill, initial indications reveal around four million tonnes of the 19.5 million tonne per annum industry had been affected.
Some growers have lost 100 per cent of their crop, a blow from which they may never recover, Mr Greenwood added. Sugar prices skyrocketed to a 30-year high ahead of the cyclone, in anticipation of the damage, and are expected to continue tracking higher, making it a double blow for local growers who cannot cash in on the increased price.
Raw sugar for March delivery rose 4 per cent to US35.31c ($35c) a pound in New York.
The Maryborough Sugar Factory, the only listed producer, said it expected a loss of production of up to 10 per cent, but added that its mills, plant and equipment had not sustained significant damage.
Chief executive Mike Barry said the drop in production would not affect earnings as it would be offset by the higher sugar prices.
The banana industry was also hit. The Australian Banana Growers' Council said the $400m sector had taken a significant "battering", with 75 per cent of production affected.
The state's massive mining sector, already badly hit by the severe flooding last month, appears to have escaped any serious impact from the cyclone.
Infrastructure and mines that were closed ahead of the severe weather event started to reopen late yesterday, as it appeared no major damage had been caused.
Coal ports, including Abbot Point, Dalrymple Bay and Hay Point, were shut ahead of the cyclone, along with mines in the area.
Xstrata evacuated non-essential workers from its Mount Isa operations late yesterday after staff at its Ernest Henry copper mine had been reduced to a skeleton crew.
The mines shut included BHP Billiton, Rio Tinto and Peabody Energy operations.
North Queensland Ports Corporation said there had been no reports of major structural damage at Abbot Point, Mackay, Dalrymple Bay and Hay Point terminals.
It said Hay Point, Dalrymple Bay and Mackay had reopened late yesterday but it did not expect to reopen Abbot Point terminal as there was still no power for navigation leads.
QR National said it had started assessing its rail network and other assets, after it had suspended services on lines in the areas affected by Cyclone Yasi.