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Pricing of Queensland Sugar Cane: Appraisal of the Present Formula and a Suggestion for Reform

Author

Listed:
  • Dixon, Peter B.
  • Johnson, David T.

Abstract

Production and milling of sugar cane in Queensland occur in a highly regulated environment. In particular the price of cane is determined by a formula which has been used virtually unchanged for about 70 years. Under this formula, the returns to millers are tied to the price of sugar, not the costs of milling. It is argued in the paper that this could lead to economically unjustified changes in milling arrangements and wasteful uses of milling resources. Other weaknesses of the present formula are also identified. An alternative formula, overcoming all identified problems, is suggested.

Suggested Citation

  • Dixon, Peter B. & Johnson, David T., 1988. "Pricing of Queensland Sugar Cane: Appraisal of the Present Formula and a Suggestion for Reform," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 56(01), pages 1-9, April.
    • Handle: RePEc:ags:remaae:9652
    DOI: 10.22004/ag.econ.9652
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    References listed on IDEAS

    as
    1. Connell, Peter & Borrell, Brent, 1987. "Costs and regulation of cane harvesting practices," Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) Archive 316181, Australian Government, Australian Bureau of Agricultural and Resource Economics and Sciences.
    2. Borrell, Brent & Wong, Gordon, 1986. "Efficiency of transport, milling and handling in the sugar industry: a case study of the Mackay region," Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) Archive 316178, Australian Government, Australian Bureau of Agricultural and Resource Economics and Sciences.
    Full references (including those not matched with items on IDEAS)

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    Keywords

    Demand and Price Analysis;

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