CANEGROWERS is calling on Sugar Terminals Limited to take the first steps on the long road to repairing its relationship with growers following last week’s Annual General Meeting (AGM) where grower shareholders voted down the STL Board’s remuneration report.
“Twelve months ago, growers were largely unconcerned about STL,” CANEGROWERS Chairman Owen Menkens said. “The company was viewed as a guardian of some of our most strategically important industry-owned assets, and as such, it enjoyed a certain amount of trust and respect within the grower community.
“That trust has clearly been eroded, with grower shareholders voting down the STL Board’s remuneration report in a clear signal of their frustration at the company’s actions over the past year.”
Mr Menkens said the result could have been easily avoided, but STL’s handling of its decision to insource terminal operations had created a divide across the industry in what has become an overly personal debate.
“The decision itself was controversial and this division has continued throughout the year as both STL and QSL have travelled the industry to argue their case for the role of operating the terminals. This very visible debate has continued right up to AGM season.
“The reality is, the management of these terminals is something that is very close to the hearts of growers, who funded two-thirds of their construction. This major change came out of the blue for growers and shareholders.
“The industry ownership and management of our sugar terminals is one of our greatest assets as an industry. We need confidence and stability around this issue, not radical changes, corporate posturing and division.”
Mr Menkens said that at the heart of the issue is the corporatisation of STL’s shareholder base, and a larger shareholder contingent that is no longer active in the industry. These issues, he insists, must be addressed.
“The insourcing decision and the way it was executed is symptomatic of a greater risk, that the STL board becomes out of touch with the industry it serves. Unfortunately, we have a situation where the majority of shares of STL are held by corporate entities, millers and marketers.
“CANEGROWERS has very clear expectations of the incoming Board of STL. These expectations have been determined by our grower leaders from across the state and include:
- Terminal ownership and control must remain within the active side of the Australian sugar industry
- Reliable operations of terminals must guarantee and prioritise sugar is ready for trade
- Pricing models must be transparent, operating on a cost recovery basis and with no differential pricing across terminal facilities
- Growers should encouraged to become active in their use of their voting rights and be encouraged to use their votes to influence the operations of STL
- Storage and operations of terminals should not disadvantage any marketer in either the allocation of space or pricing
CANEGROWERS congratulates new Director of STL Steve Kirby on his appointment to the Board and acknowledges the contribution made by outgoing G Class Director Stephen Calcagno.
Now is the time for STL Board members to examine their decisions to ensure the outcomes of those decisions are in the best interests of the whole industry.