The Australian federal government is to bailout the struggling sugar industry in order to prop up towns along the Queensland and northern NSW coast, Trade Minister Mark Vaile said on Sunday, IndustrySearch.com reports.
The cabinet is considering a $100 million (€56m) rescue package which would require substantial changes within the industry, including merging small farms into co-operatives and a levy on consumers.
The report continues that the National Party backbench is also putting pressure on the government to mandate the use of ethanol in fuel. Asked why consumers should pay for an industry that had already been given assistance, Vaile said that question could be posed about any industry receiving assistance.
"You might ask yourself, `why assist 6,000 farming families?'," he said in an interview. "So many communities along the coast of northern NSW and Queensland rely absolutely on the Australian sugar industry. It is very, very significant in terms of its impact on those regional economies but also our exporting economy, so it's important we think in the national interest in this regard."
Vaile said significant reform was needed for the industry to move ahead but said nobody could yet forecast how many cane growers should get out.
"What we need to focus our attention on is where we need to get to in terms of opening up new markets and making access into existing markets fairer," he said.
Vaile said mandating levels of ethanol - not subject to fuel tax - in petrol was an option which should be pursued. "We should not be closing the door on an ethanol industry in Australia," he commented.