Douglas Shire cane growers have just received news announcing the appointment of a voluntary administrator for the Mossman Mill. Despite record high global sugar prices, supply challenges and adverse weather conditions are being blamed for interrupting the Mill’s ability to operate viably.
Stakeholders were informed in an email received today, a copy of which Douglas News is sharing with readers below:
Daintree Bio Precinct Ltd and Subsidiaries
Appointment of Voluntary Administrator
The Directors of Daintree Bio Precinct Ltd and its subsidiaries, Far Northern Milling Pty Ltd, Far Northern Infrastructure Pty Ltd and Daintree Bio Enterprises Pty Ltd (“Companies”) will today meet with the intention of placing the Companies into voluntary administration. To this end, the Directors will appoint Mr John Goggin of Worrells, Cairns, to act as voluntary administrator of the Companies.
A number of factors, which have been advised to you, have resulted in lower than forecast revenue for the Companies which has led to the financial distress of the Companies. The effect of this is that insolvency of the Companies is imminent. The appointment of a voluntary administrator is considered a proactive step in the interests of the Companies and the best chance of securing a future for the Mossman Mill.
The process of voluntary administration is designed to resolve a company’s future by placing the operational control of the Companies in the hands of a specialist administrator. The appointment of the voluntary administrator does not mean the immediate cessation of all operations.
The voluntary administrator will assume control of the Companies (replacing the Board for the period of the administration) and continue with existing critical operations in the short term. The voluntary administrator will then assess whether the future of the Companies, and indeed the Mossman Mill, is viable. In doing so, we expect that the voluntary administrator will be assisted by the management team and operational staff. The voluntary administrator will then engage with creditors and key stakeholders to assess the options available in respect of the future of the Companies and the Mossman Mill. The Directors have expressed to the voluntary administrator the fundamental importance of facilitating the operation of the Mossman Mill for the 2024 season and are confident that, where it is financially viable to do so, the voluntary administrator will have regard to this in undertaking the administration.
Following Mr Goggin’s appointment, the formal steps will be taken in relation to the administration as required by the Corporations Act 2001. Creditors will be invited to meet with the voluntary administrator and creditors, employees and stakeholders can expect to receive further information from the voluntary administrator in coming days.
The Directors are, of course, saddened by the financial circumstances of the Companies. However, the Directors are also confident that the appointment of a voluntary administrator to manage and assess the affairs of the Companies is in the best interests of the Companies, Growers, creditors and stakeholders.
Chairperson, Daintree Bio Precinct Ltd and Subsidiaries
In operation since 1894, Mossman Mill crushes cane supplied by around 140 local growers.
Mossman Mill is currently operated by Far Northern Milling Pty Ltd, formed in 2018 by growers based in Mossman and the Tablelands. Acquisition of the Mill from Mackay Sugar Limited was completed in 2019, supported by a $45 million taxpayer-funded handout from the Queensland and Federal governments which hoped to secure the future of Australia’s most northern Mill.
The mill generates over $75 million of direct input into the economy each year and supports over 570 full time equivalent jobs. It is supplied by approximately 100 farmers over 13,400 Ha of farmland.Douglas Shire Council
In 2019 Mossman Sugar Mill faced permanent closure. To remain viable, increasing volumes of cane were required. Mossman Mill has the capacity to crush 1.2million tonnes but in 2023 has process only 380,000 tonnes.
To turn Mossman Mill into a viable operation, the focus for Far Northern Milling has been to expand the revenue base from sugar and molasses to include value adding of waste streams such as bagasse and mill mud. Production of higher value sugar alternatives to sucrose will also contribute to increased revenue.
In a separate accompanying statement supplied to affected canegrowers, Daintree Bio Precinct Pty Ltd propose that creating a sustainable sugarcane growing and processing industry at Mossman is possible.
In a future report, Douglas News will break down the elements of this proposal.
A report commissioned by Douglas Shire Council found that the contribution of the sugarcane industry to the regional economy is $188.9 million per year. This equates to $945 million over five years. Over the last five years, since the threat of permanent closure in 2019, Mossman Mill has contributed $250 million in revenue directly into the local economy. Of this $47 million has gone into mill employment.
As the second largest employer in the Shire (after tourism), this announcement will have huge repercussions on the local economy and social fabric of the Douglas Shire.
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Featured Image credit/ Far Northern Milling