Australia's sugar industry

By Robert F. McKillop

Early History

Introduction

Sugar cane was brought to Australia from South Africa with the First Fleet in 1788. In the same year Captain King took cane to Norfolk Island. Australia's first centre of growing was at Port Macquarie, where Captain Allman, commandment of the penal settlement, supervised planting of cane from Norfolk Island in 1821. This was done by a West Indian convict, James Williams.

In 1823 T. A. Scott arrived to expand the enterprise and commenced the experimental manufacture of sugar, molasses and rum. Scott was dismissed in 1828 after 20 tons of sugar had been produced and the venture was abandoned in 1831.(1) Scott retired to Point Claire, in the Hastings Valley where, for the rest of his long life, he continued to grow cane and promote the industry. A commercial sugar mill opened on the Hastings in 1867.*

By 1868, there were nine mills in NSW which produced 60 tons of sugar. The focus of the NSW industry shifted to the Clarence, Richmond and Tweed River valleys after 1870.

The "father' of Australia's sugar industry is regarded as Captain Louis Hope who established a plantation near Brisbane using cane supplied by T. A. Scott. He opened the first commercial sugar mill, Ormiston, in 1864, just five years after Queensland had become a separate colony. However, management problems led to its closure in 1874. Early in 1865 J. F. Kelsey, a Mauritius sugar planter, floated the Bowen Sugar Company to establish a large sugar estate at Bowen. Some 30 tons of sugar and 3729 gallons of rum were produced in 1868, but the climate was unsuitable and the venture failed. However, other sugar centres progressed and by 1867 there were 2000 acres under cane in the Brisbane district and six mills in Queensland. The industry expanded rapidly north with mills opening at Maryborough in 1866 and Mackay in 1868. By 1885 there were 102 mills in NSW and 166 in Queensland.

The early sugar ventures were based on individual farms with their own small-scale milling ventures or central mills taking supplies from surrounding farms. At Mackay, local farmers sought to establish a co-operative company in 1869 to establish a central mill (2). The venture folded, although there were several subsequent attempts. When the Colonial Sugar Refining Company established their first mills in 1869, they chose a system whereby independent small farmers entered into forward contracts with the central miller to supply cane. The success of these mills resulted in this central milling model becoming the industry norm in New South Wales.

The Plantation Era

Queensland's sugar industry initially followed a very different pattern to that in the south. There the idea that cheap coloured labour would be necessary to sustain tropical agriculture gained early credence. In 1862 the new colony of Queensland passed a Coolie Act which provide conditions under which Asiatics could be indentured to work in the colony.

Captain Robert Towns, a leading Sydney merchant with far-ranging Pacific trading interests, who came to Queensland in 1859, was the first to take advantage of the new Act. Towns proposed to employ Indians for growing cotton on the Logan River. When he found Indians were not available, he sent his schooner Don Juan to recruit labour in the New Hebrides in 1863. The labourers proved their worth and before long others recruited Pacific Islanders for cotton and sugar plantations at Cleveland, Caboolture and Maryborough. Claudius Whish and his partner, Trevillian, first used kanaka (South Seas Islands) labour on their Caboolture sugar plantation in 1865. Queensland's other sugar pioneer, Louis Hope, began to use coloured labour in 1867 (3).

The availability of cheap South Seas labour and an abundance of new land provided the opportunity for men of capital to establish sugar plantations employing 40 to 200 labourers in the fields. The plantation companies constructed their own mills and a small elite group of white managers and overseers supervised the work of gangs of coloured labour (4). Working conditions for the labour lines were harsh and the returns meagre.

Maryborough was initially the focus of the Queensland sugar industry, but the main centre for sugar growing soon shifted to Mackay, where John Spiller pioneered the crop in 1865. Commercial sugar production at Mackay became a reality when T. H. Fitzgerald and J. Ewan Davidson erected an iron sugar mill at Alexandra in 1868. By 1874 Mackay had sixteen mills in operation and 4,927 acres under cane. Cane growing in the Herbert River area also developed between 1869 and 1872.

The rise of Mackay as the "Sugarpolis" of Queensland identified the district's prosperity with the maintenance of South Sea Islands labour. By 1877 Mackay had become the destination for the majority of Island labourers.

Indentured labourers were housed under indifferent standards and received minimum rations defined by government regulation. A dysentery outbreak on the Herbert and a wide spread epidemic of measles in 1875 were responsible for a number of deaths.

Queensland's planters came to see the Islands labourers as indispensable for the industry's well being. Attempts to employ Chinese, Aborigines and European immigrants were not successful and recruiters of Pacific Islanders moved to tap new sources in the Solomon Islands.

The role of Melanesian labour in establishing the Australian sugar industry has been the subject of recent research by historians. A common theme has been the issue of forcible "kidnapping" by the blackbirders, as descendants of the original labourers interpret history (5). Horror stories of plantation life abound, but it seems that the majority of the recruits came to the Queensland canefields out of a sense of adventure. Moore points out the contradiction between the oral tradition of "cultural kidnapping" held by Queensland Melanesians and the evidence of voluntary enlistment presented by historians (6). The Melanesian view is linked to their low status in the Australian community and their lack of recognition as the true founders of the sugar industry.

Colonial Sugar Refining Company Limited

Origins

In 1839 Francis Kemble and William Knox Child formed the Australia Sugar Company and commenced the construction of a sugar refinery in Sydney (7). Before their venture could commence operations, a trade slump and disagreements among the principles led to dissolution of the company. The Australasia Sugar Company was formed to take over the assets of the former venture. The refinery commenced operation in 1842.

In 1843 Edward Knox came out to manage the struggling company. He remained as manager until 1846 and as a director until 1854, when disagreements again arose and the company was dissolved (8). The Colonial Sugar Refining Company was formed on 1 January 1855 to take over the assets. By this time Edward Knox had established himself as a leading personality in the business life of Sydney. He applied himself with vigour to organising the new company into a commercial success. Business was brisk, and in 1857 it was decided to establish an associated company, the Victoria Sugar Company, to establish a refinery in Melbourne.

Late in 1857 with the company's future looking buoyant, Knox departed for Europe. This coincided with a fall in the world price of sugar, a depression in Australia and an internal dispute in the company. With estimated losses of over £120,000 the Sydney directors were ready to throw in their hand, when Knox returned. Faced with personal ruin, Knox threw his energy into restoring the Company. To establish greater stability in the supply and price of sugar, Knox decided to grow his own, sending the Company's sugar expert Melmoth Hall, "an Indian planter of 16 years experience", to report on the potential for sugar growing in October 1868 (9). Hall's report was favourable and it was decided to establish central sugar mills on the Macleay and Clarence Rivers. The Company place an advertisement for contracts in the Clarence & Richmond Examiner on 14 July 1865. Hall was sent to the district on an education campaign. Knox placed his son Edward William, in charge of the project to establish the mills (10). The new mills, opened in 1870, were successful, becoming the main source of the company's profits in their second season. Several small ships were purchased to bring raw sugar and molasses to the refineries. A new refinery at Pyrmont in Sydney was commenced in 1875.

Sugar Milling

CSR's entry into sugar milling was a bold new venture into uncertain fields. Edward William Knox was only 23 years of age when appointed to manage the new Southgate mill on the Clarence in 1870 (11). The following year he took over responsibility for all three mills. He soon mastered the problems arising from the establishment of an infant industry, working on the NSW coast for 10 years. During this period he established the foundations for the Company's future success as a sugar miller. He kept a firm hand on all aspects of operations, recording progress in detailed reports which he thoroughly analysed for lessons which could be applied to achieve greater efficiency.

Arrangements for the cutting and transport of cane and the prices to be paid were important issues to be settled from the outset. Knox observed:

"For some time after we commenced work, cutting was done by hands on day labour, but we soon found that a most costly plan and I have offered the cutters 2/6 per ton for cutting, bundling and loading into carts. The offer was accepted, but bundling was shortly after discontinued - we paid 2/- for cutting and loading, while we put the cane onto punts. When the gangs were removed from Southgate, we dismissed the punt men and paid the cutters 6d extra for loading the punts. I doubt that the work could be done for much less." (12)

Cane prices and purchasing arrangements were also difficult issues. Knox observed:

"The mode of purchase of cane is a matter requiring great consideration. There are many objections to the present system of buying by the ton, as no distinction is made between good and bad cane. There is also dissatisfaction among farmers arising from their inability to understand the gauging of the punts." (13)

E. W. Knox visited the West Indies in 1876 and, on his return, introduced double crushing and other efficiencies to improve the burning of coal in the company mills. Knox was constantly seeking to keep abreast of international developments in the industry and, on the basis of his West Indian experience, proposed:

"Now that we have seen in both branches of our business how necessary it is that we should be kept fully informed of what is being done elsewhere in the refining and manufacture of sugar, it will be well to arrange to send some of our staff every two or three years in the quest for knowledge that will be of service to us" (14)

Chemical laboratories were also established to improve quality control. With these improvements, CSR was able to improve the efficiency of their mills over those operated by competitors. By 1979, the three Clarence mills crushed 65,000 tons of cane, although with increased boiler power the mills had the capacity to crush 100,000 tons (15).

At the conclusion of the 1879 crushing season E. W. Knox looked back over his ten years experience in establishing the NSW mills with satisfaction, offering the following retrospect:

"Although we may to some extent congratulate ourselves on the improvements which we have effected in our work of late years ... the results ... show how much money we have thrown away by our ignorance of the business when we commenced and in the alterations which we have now been compelled to make in our plant... Had we used the double crushing system throughout, the yield of sugar for '70 to '76 would have been increased by about 3500 tons, and our present market is at least 2 pounds per ton better than the average of those years. A considerable improvement has been in the consumption of coal which has come down from a mean of 6.5 tons cane per ton of coal in '71 and 8.7 tons in '72 to 12.7 tons in '79, and the quantity of cane crushed per hour has increased at Chatsworth from 7 tons in '71 to 13.27 tons in '79.

"The profits on the business have been as large as we have had any reason to expect. In the ten years including '79 the... profits give a return of 23 per cent on capital after charging interest at the rate of 6% on the ventures of the sugar. (16)

But Knox continued to be troubled by the relationship of the company with his suppliers and the threat he saw from the emergence of small mills. In terms of future prospects, he concluded:

"Our outlook is not altogether a cheery one: although we have gradually improved our work, ... we have to face the questions:

How are we to maintain the supplies to the Clarence mills; and
Check the deflection of so many of our largest planters who are erecting mills for themselves.
I have to confess I see no way of ensuring of the business in our hands except we raise the price of cane sufficiently to hinder the erection of small mills and to induce more cane growing compared with maize... I question if we are acting wisely in seeking to retain so much of the profit: in the longer run we shall have to give way or loose the business, and if by a little liberality we can secure our footing, my opinion is that it would be better for us to pay the higher price and be content with slightly lower but more secure profits.

"We have reached a point where we cannot stand still and, on the Clarence at any rate, must either advance to loose ground: surely, it is not wise that a company such as ours should permit itself to be driven from that district by a number of men possessing but small means and paying high rates of interest for the money they borrow to purchase their manufacturing plant. The large balances which we shall have this year to divide will enable us to make our position secure against all opposition and we can then without any misgivings pursue a liberal policy which will, I firmly believe, eventually prove to be of direct benefit to ourselves as well as to the farmers with whom we have dealings. (17)

Industry dominance

E. W. Knox became general manager of CSR in 1880, the year crushing commenced at the new Condong mill on the Tweed. The company soon expanded into Queensland, opening Homebush and Victoria mills in 1883 and Goondi in 1885. In Fiji also, three mills were opened during the first five years of E. W. Knox's general managership. Chelsea Refinery in Auckland, New Zealand, which commenced refining in 1884, was built by CSR as agents for the part-owned New Zealand Sugar Company.

Knox's concern about small-scale mills was not well founded. While CSR increased their cane prices in 1882, the increasing efficiency of the large-scale mills soon forced smaller units out of business. When the price of sugar fell in 1884, CSR were able to respond with the introduction of further production efficiencies. Head office advised mill managers:

"The great fall in the value of sugar this year has forced on our attention in a very unpleasant way the necessity to improve our work and reduce our expenditure to the greatest possible extent and I wish now to direct the attention of our managers to some details of the work in which some savings can be effected. This includes better exhaustion of megass (specifies methods); fuel - proportion of coal against megass; boiling and centrifuging of sugar. (18)

In 1887 the three refining companies were amalgamated into a limited liability company, The Colonial Sugar Refining Company Ltd. The paid-up capital of the company, at £600,000, was amongst the largest of the day. It was intended that this new company should be distinctly Australian in ownership, which would enable it to maintain protective tariffs for its refinery interests. With these tariffs, CSR was able to consolidate its business in the 1890s and open two more refineries in Adelaide and Brisbane.

By 1903, CSR had 15 mills in Australia and Fiji. This heavy investment provided a strong incentive to increase its expertise in the manufacture of sugar, and the company was more able to finance the required research than proprietors with fewer mills over which to spread the cost. The outcome was that CSR developed skills that far surpassed other millers of the day. It could also reduce costs by purchasing in bulk from its mills.

Following the Second World War, the Australian sugar industry was expanded. The immediate postwar production of 950,000 tons was increased to 1.3 million tons by 1954. CSR mills, particularly Victoria were expanded to meet these production requirements. In 1954 the gross revenue from CSR mills was £17.4 million. However, sugar was becoming less dominant among company activities as CSR expanded into new ventures, particularly mining. To reflect the change in activities, the company became CSR Limited in 1973.

Although CSR divested itself of its Fiji sugar interests in 1973, sold its New South Wales mills in 1974 and closed older mills at Goondi and Hambledon, it revived its investment in the industry during the 1980s. CSR has gained control of the three mills in the expanding Burdekin River district, together with the Plane Creek mill at Sarina, while expanding its milling capacity in the Herbert River district.

The Central Milling System

Northern New South Wales

In New South Wales, the sugar industry developed as a small-holder farming activity from the outset. As early as 1867 the Clarence River Sugar Growers' Association was formed with the intention of forming a joint-stock company to construct a mill. Edward Knox, of CSR watched these developments with interest and in 1868 he appointed Melmoth Hall, a West Indian planter, to seek suitable areas for the establishment of mills to crush cane for surrounding growers.

Based on Hall's reports, the CSR Company decided to set up a central milling system. Edward Knox chose a system whereby independent small farmers entered into forward contracts with the central miller to supply cane. The Company arranged for the harvesting and transport of the cane. The approach involved terms of agreement with individual farmers to grow cane for 10/- a ton (with an extra 1/- for cartage to the mill).(19) CSR took responsibility for cutting the cane. The river systems provided the transport artery. Cut cane was brought to the river bank by dray and loaded onto company punts, which were hauled to the mill by company steamer.

The system evolved over the formative years, with some disputes between miller and farmer over the standards of cultivation, quality of cane and the basis for payment providing the impetus for longer term solutions. Competition from small, independent mills for cane supplies was of concern during the late-1870s, resulting in an important internal debate within the Company over their partnership with farmers and the importance of ensuring a fair distribution of profits. In February 1882, the Board decided to offer cane growers on the Clarence a higher price, provided they would guarantee to ensure a full supply of cane for the mills.

After the unsatisfactory experience of attempting to grow their own cane on Condong Estate on the Tweed (20) , the Company found the drive and incentive of individual farmers to give superior results.

The central milling system established in NSW was to provide the model for Company operations elsewhere.

Evolution of the Queensland Plantation System

In contrast to New South Wales, Queensland's sugar industry was initially dominated by plantations. The first estates established in the 1860s required only small capital investments, coupled with a resilient pioneering spirit on the part of the local plantation owners. (21) By the 1880s, large amounts of capital were invested and the owners needed business acumen, not pioneering zeal. The plantation regime was characterised by large farming units, vertical integration of the farming and milling process, and extensive human capital investment using indentured Melanesian labour.

Opinion leaders in the north saw plantations worked by coloured labour as an essential element of their economic future and the growing shortage of kanaka labour was viewed with increasing concern.

Following the Land Act of 1876, a number of small farmers took up homesteads in the sugar districts. Initially they mostly grew maize for the Pacific Island labourers, but returns were not satisfactory and they too turned their holdings into canefields. They were initially dependent on the goodwill of the bigger planters to get their crop crushed, but usually they could only get access to the mill at short notice after the estate cane had been given priority. Despite its successful experience of central mills serving independent farmers in NSW, CSR personnel in North Queensland were initially hostile to independent smallholder suppliers and the company followed the pattern of plantation production in Queensland and Fiji. The experience was generally unsatisfactory, with constant labour problems and difficulties in controlling labour costs.

By 1882 six small-holders on the Herbert braved ridicule and formed the Herbert River Farmers Association. The group sought to "explode the belief that the district can only be developed by gangs of black labour with a few white bosses." They were given support by Frank Neame of Macknade. Moreover, public opinion was turning against the kanaka trade and toward the end of 1882 anti-coolie demonstrations were held at Mackay, Charters Towers and Townsville.

In 1884 recruitment ship crews were charged for illicit recruiting and murder and these incidents, together with a riot by Islanders at Mackay, fuelled opposition to coloured labour. Sickness also took its toll. In 1884, there were 1,743 Islander deaths reported, a mortality rate of 14% of the total Islander population in Queensland. (22) Islanders were no longer regarded as the most efficient of labour forces and pressure grew from planters to allow the recruitment of Indian labour. Following a Royal Commission into the traffic in Pacific Islanders in 1885, legislation was introduced for cessation of the recruitment of Pacific Islanders after 1890.

The issue was resolved by economic forces. Following an industry boom in the early 1880s, competition from European beet sugar producers resulted in the world sugar price falling by a third in 1884. (23) The inefficiency, low productivity and rising labour costs of the plantation system were exposed. Moreover, technological advances meant that erection of sugar mills now required large-scale capital. As in Mauritius and the French West Indies, this situation was met by the emergence of a central mill system. Planters confined themselves to cane growing, sending their cane to a milling firm which dealt exclusively with crushing and refining.

In the Queensland context, central mills were also seen as an experiment to help solve the deep-rooted question of abolition of coloured labour. Social questions were at the forefront of the policies of the Liberal Party headed by Sir Samuel Griffith. As early as 1875, the Liberal Party was urging the construction of central mills and studies were undertaken of the system in the US and the West Indies. In 1883 a Sydney engineer, Angus Mackay, had reported to the Queensland Government on the working of central mills overseas. (24) Mackay highlighted the efficient central mill system in the West Indies and noted that in times of difficulty, large plantations would be cut up into farms of 50 acres rented by white or black farmers.

The idea lay dormant for several years, but was taken up by the Griffith Government in the late 1880s. (25) In 1885 a small group of farmers from around Eton in the Mackay district petitioned Premier Griffith for the establishment of farmer-controlled central mills as the only solution to the labour problem and "a remedy by which farmers and selectors may be rescued from impending ruin" (26) This move was an obvious corollary to Griffith's desire for smaller scale agricultural settlement in the colony and an end to dependence on coloured labour. His vision was a population not of tenants, nor a servile race, but of man living on his own lands, growing there his own sugar and making not large incomes, but fair incomes and selling their produce to the mills.

The trend to central milling stepped up. In 1884 the CSR overruled its local manager and offered seven-year agreements to the small-growers of the Lower Herbert. In 1891, CSR, after thorough investigation into the viability of the plantation system, took the decision to cut up the Homebush estate into farm-sized blocks and lease them to farmers, with an option to purchase. The most powerful organisation in the industry had been forced by labour difficulties to seek this solution to its production system.(27) The experiment proved promising, and other estates at Herbert and Johnstone Rivers followed shortly after. By the turn of the century, the majority of cane in the Herbert district was being produced by independent farmers on 160-acre selections. (28)

In 1886 W. O. Hodgkinson was sent to identify areas where government supported central co-operative mills could be established. In most districts small-growers were firm in their belief that sugar growing required coloured labour and rejected Government proposals, but at Mackay groups of farmers supported the central mills and agreed to lease their lands to the government for an advance of between £20,000 and £21,000. (29) Hodgkinson duly recommended the establishment of central mills at Racecourse and North Eton. However, both concerns ran into difficulties and furnished the coloured labour party with a stick to beat Griffith's policy. (30)

In 1890 the Burdekin and Herbert planters agreed to seek labourers from Italy, who would be entitled to purchase a smallholding after two years service. 320 Italians arrived at Townsville in December 1891, but they encountered considerable working-class opposition. This opposition, together with the lack of co-operation by old-fashioned planters, finally broke Griffith's stand against the recruitment of Islanders, and in 1892 coloured labour recruitment was resumed. (31)

End of the Plantation Era

By the nineties the old system of heavily capitalised estates worked by gangs of Island labourers was doomed. Technological advances had made milling a specialised occupation By concentrating on processing and sub-dividing their land for sale to small farmers, mill-owners were able to spread the risks of sugar production. The issues were readily apparent by 1897, when the book Work and Wealth of Queensland summed up the dilemma of the plantation:

"Large estates require more labourers per unit area than independent farms [One 1000 acre plantation requires one labourer:5 acres cane compared with 1:10 on 100 acre farms], so that farmers can afford to sell cane to the mill more cheaply than the mill owner can grow it himself. On the other hand, the introduction of modern machinery and the benefits of scientific methods of manufacturing have created a position in which the small [mill] owner has no place. A mill which contains the expensive machinery and employs the expensive labour essential for the new methods does not pay unless it turns out more sugar than can be grown on even a very large estate. Both causes are working toward the same effect. The planter and mill owner who grows all his own sugar is becoming a figure of the past. (32)

Many of the plantations established in the McIlwraith boom of the eighties were bankrupt by the nineties and there were few offers to take over failing enterprises. (33) Pressure mounted to retain Pacific Island recruiting. The CSR added to the debate by proposing to cut their losses and closing their North Queensland operations. (34) Homebush was to be sub-divided while Goondi would be retained with coloured labour, but Victoria was to be closed and the mill moved to Fiji.

The view that the collapse of the plantation system was linked to pressure to cease indenture of Melanesian labour has been challenged by Moore. (35) He notes that small-scale farmers were as dependent as the largest planter upon Melanesian labour in the 19th century. Moreover, the crucial transition from plantations to small-scale farms occurred in the 1880s, when the labour trade was still flourishing.

Sugar Works Guarantee Act, 1893

With the return of McIlwraith to government, he declared himself a convert to the encouragement of smallholders. In 1893 he brought forward legislation to authorise the financing of central mills by debentures backed by a government first mortgage on the mill itself and the lands of farmers supplying it with cane. (36) Authority for construction was to be granted in any district where there was sufficient cane available for profitable working. Eleven new central mills were established, expanding sugar production in existing areas and allowing new areas, such a Mossman, Proserpine, Sarina and Mulgrave to be planted to cane. The old plantations, led by CSR at Homebush and E. M. Long at Habana in the Mackay district subdivided their lands for new settlers. Italian migrants soon turned out to be hardworking and successful settlers and brought out relatives to the new industry. Between 1892 and 1902 the area of cane in North Queensland increased from 23,623 acres to 46,291 and sugar production from 31,052 tons to 69,486 tons. (37) By 1894 it was estimated that all but 110 of Queensland's 1,387 cane-growers were smallholders with less than 90 acres each. A few plantations continued under the old system but all were operating under financial strain.

In 1897, Macknade and Hambledon were purchased by the CSR Company who soon set about subdividing the estates. Under the CSR schemes settlers were allocated blocks of 30 acres, with the right to another 30 when the first 30 was under cultivation. The land could be bought outright after three years if cash was paid, or five years on terms. The Company advanced three-quarters of the cost of all work done by the tenant from the time he began scrub-felling to the harvesting of the first crop. It was the tenant's responsibility to cut and load cane, payment on delivery to the company's tramlines ranging from 11s to 12s 6d a ton. The company gave a preference to men who had been in their employ. In this manner CSR gave a lead to other mill-owners to abandon the plantation system. On the Burdekin, John Drysdale played a similar role, particularly through the provision of irrigation to the settlers.

Through the nineties dependence on Pacific Islanders increased, however, and, by 1902 there were 9,841 in Queensland. Other non-Europeans were also employed, numbering 7,261 Chinese, 3,210 Japanese, 322 Javanese and 1,598 'others' in 1898. These numbers aroused fears that Australians were being squeezed out of the "black north". On the Herbert there were four serious riots between 1889 and 1892.

With Federation, the Commonwealth Parliament became dominated by spokesmen for "White Australia". In October 1901 legislation was passed prohibiting the introduction of Pacific Islanders after 31 March 1904.(38) After this attitudes against coloured labourers hardened in the white community and in the summer of 1906-07 the majority of Pacific Islanders were repatriated. However, those who remained brought a strong Melanesian heritage to many Queensland coastal communities, such as Mackay, where 10 per cent of the coloured community are descendants of Melanesian indenture labourers. (39)

Triumph of the Yeoman Farmer

The decline of mining in the early 20th century resulted in men turning to the canefields for employment. New estates were subdivided for sugar lands and new mills were erected at Babinda, South Johnstone and Inkerman in 1914-15. North Queensland was well on its way to becoming the yeomanry of small-farmers visualised by Griffith. (40) The new settlers were pioneers, but it was pioneering in which the whole family took part. Until the mills were working the family kept themselves in whatever jobs were offering. The area of cane in North Queensland increased from 57,954 to 78,013 acres between 1906 and 1917.

A dramatic restructuring of the sugar industry ensued. In the Mackay district, the 28 plantation and two central mills of 1885 gave way to large central mills co-operatively owned by small farmers. By 1900 there were five farmer-controlled mills which out-produced the seven remaining plantation mills. By 1925 seven central mills produced three times as much sugar as the 30 mills of 1885. (41)

The Industry in Transition

Sugar Marketing

Two issues made the early twentieth century period a difficult one: cane prices and labour disputes. Cane prices were fixed by the mills and they in turn were influenced by the CSR monopoly of sugar purchases. A Royal Commission, which toured the sugar districts in 1912, found the CSR held its prominence to high efficiency rather than any form of malpractice. (42) The CSR led the opposition of private mills to any form of price regulation, but in 1914 a Labour Government was swept into power and it soon brought in an Act to provide for the establishment of a board in any sugar growing district with power to assess minimum price for sugar cane during the forthcoming season. A central board was set up in Brisbane to hear appeals from local boards. During the First World War, the Queensland Government took power to acquire all raw sugar manufactured within the state and this arrangement continues to-day with the Queensland Government acquiring all sugar manufactured in Australia and refining company's acting as agents, with the duty of refining and distribution.

Industrial Issues

Industrial unrest on the canefields emerged from 1907. The Amalgamated Workers Union (AWA) was formed in September 1907 under the leadership of E. G. Theodore and W. McCormack. The union started in the North Queensland mining fields, then spread to railway workers and labourers from the sugar industry. The unions began to apply pressure to improve conditions with the target being the CSR monopoly. Mill managers, used to the docile Pacific Islanders, found difficulty in dealing with organised white labour. (43)

The unrest culminated in the sugar strike of 1911. The strike was generally successful, enhancing the standing of the AWA, which amalgamated with the Australian Workers Union (AWU) in 1912 and 1913. In 1915 the Labour party achieved an overwhelming victory at the polls in Queensland and the following year Judge Dickson of the Arbitration Court granted large wage increases to sugar workers. Millers felt that the increases were too generous, and most mill south of Townsville were closed, some for two months. However, Ryan's position on cane prices demonstrated he was on the side of the growers against the CSR, and the government's position was generally enhanced.

The Modern Industry

Consolidation and Prosperity

After World War I stable prices and improved rail access resulted in further expansion of sugar lands. The area under cane increased from 162,619 acres in 1920 to 269,509 acres in 1925. Yields also increased as a result of the work of Sugar Experiment Stations. Thus by 1924 there was overproduction for the Australian market and sugar exports were commenced. By 1928 about 200,000 tons had to be exported despite instructions by the central board from 1927 to 1929 to limit mill assignments. Internationally there was overproduction of sugar and world prices declined from 1928 to 1933.

Following the Second World War, the sugar industry was hard hit by a shortage of labour, particularly for cane harvesting. Displaced persons from the upheavals of Europe were brought to Australia by the International Refugee Organisation from 1947. Two thousand DPs were sent into the North Queensland sugar industry and came to be regarded as the saviours of the industry at that time. (44) They worked as canecutters, living in cane barracks during the harvesting season and moving south during the five-month slack season.

The next major development in the sugar industry occurred in the 1950s when bulk-handling sugar of for export was introduced. The State Government and CSR eventually chose Cairns, Mourilyan, Lucinda, Townsville and Mackay as the sugar export ports and large bulk-sugar terminals were constructed. (45)

A revolution in the Australian sugar industry occurred with the successful mechanisation of harvesting and associated improvements in cane transport. Experiments with cane harvesters date from the nineteenth century in the Bundaberg district. (46) The Faulkner cane harvester was demonstrated at Qunaba in 1924, while Fairymead was using a modified Howard Cane Harvester by 1934. The successful introduction of mechanical harvesting dates from 1960. In 1961 some 5% of the Australian cane harvest was undertaken by mechanical means, but this increased to 48.5 per cent in 1966 and 98.5 per cent in 1974. The economies of mechanical harvesting also resulted in huge increases in the total cane harvest. In 1961 the total cane harvest was approximately 9.4 million tons and by 1974 this had increased to 20.4 million tons. (47) The new machines provided chopped cane which required new approaches to transport.

The modern Australian sugar industry is unique because of a combination of features which date from the 1885-1925 period. (48) :

The cane is processed in large central mills (in 1980 33 mills produced over 3 million tonnes of sugar).
The cane is grown on family sized units by farmers who own and control the mills wholly or substantially.
The industry is the domain of almost exclusively white labour and white land-owners.
There is government control, almost complete over production levels, marketing and pricing, substantial over wages and working conditions.
The industry is one of the most highly mechanised sugar industries in the world.

An additional feature is the continued, and expanding, use of narrow gauge railways for transport of cane from the field to mill (see Chapter 2).

However, production and marketing controls, many of which date from the First World War, are considered to greatly inhibit the efficiency of the Australian sugar industry. (49) The mills rarely operate over the week-ends (the normal practice is 24 hour milling, Monday-Friday over a 20-25 week season), controls limit the supply of cane, and cane payment arrangements and marketing controls remove incentives for efficient transport. Thus, mills pay virtually the same price to growers regardless of their location and cost of transport. Cost savings have been demonstrated for reallocation of cane assignments among mills, weekend milling with fewer mills, new tramway linkages and alternative season lengths.

By June 1986, there were approximately 6400 sugar cane growers delivering some 25 millions tonnes of cane to 31 sugar mills. (50) There were then twenty-six mills operating their own railway systems. These transported some 22 million tonnes of harvested cane per season (June to December) over some 3500 km of track. During the 1980s, a process of industry rationalisation resulted in the closure of several mills and further expansion of tramway systems to transport cane to larger, more efficient central mills. By 1995, the Queensland crop was 35.27 million tonnes of cane which yielded 4.61 million tonnes of sugar.

References

* The information on TA Scott is based on the article by J Jervise in the 'RAHS Journal & Proceedings', Vol 26, 1940, pp. 387-396. A respondent to the LRRSA website has advised that Scott retired to Point Clare on the NSW Central Coast.

1. Jervis, J, "TA Scott and the Genesis of the Sugar Industry", RAHS Journal & Proceedings, Vol. 26, 1940, 387-396.

2. Kerr, J, Pioneer Pageant: a history of Pioneer Shire, Mackay, Pioneer Shire, 1980, p. 89.3.

3. Nolan, Janette, Bundaberg: history and people, Univ. Qld. Press, 1978, p. 124.

4. Moore, CR, Kanaka: a history of Melanesian Mackay, Uni PNG Press, 1986, defines plantations as a cane-growing unit and possessing its own steam-powered mill, crushing cane for more than three consecutive seasons. The concept is more generally applied to large-scale operations using labour intensive operations.

5. Fitzgerald, R "Kanakas of our cane fields, then and now", Sydney Morning Herald, 27 Dec 1986.

6. Moore, CR, op. cit., p..

7. Lowndes, AG (ed), South Pacific Enterprise: the Colonial Sugar Refining Co. Ltd., Angus & Robertson, Sydney, 1956.

8. Ibid..

9. CSR files, National Archives of Business and Labour, file Dr Birch's papers on Sugar Cane in NSW, P.2.0, folio 2, Doc. 5.

10. Lowndes, op. cit., p. 23. Edward Knox himself spent the first year at Darkwater, gaining first-hand knowledge of the difficulties of establishing the new industry.

11. Lowndes, op. cit., p. 24.

12. EW Knox, Report on the Operations of the CSR Sugar Mill at Southgate During the Crushing Season of 1870 and 1871.

13. Ibid.

14. Knox EW, Report on the Operation of the CSR Sugar Mills on the Clarence River for the Season of 1876. Archives of Business & Labour.

15. Knox, EW, Annual reports for 1879. Archives of Business & Labour.

16. Ibid. p. 33

17. Ibid., p. 34.

18. EW Knox, handwritten memo, 10 January 1884.

19. Knox EW, Report on the CSR's Sugar Mill at Southgate, Clarence River for the Crushing Season 1870 and 1871. Archives of Business & Labour.

20. Favigueve, A, CSR Mills Report for Season 1881, p. 75.

21. Moore, CR, Op. cit,. p.113

22. Brisbane Telegraph, 5 February 1885

23. Moore, CR, Op. cit,. p.113

24. GC Bolton, A Thousand Miles Away: a history of North Queensland to 1920, ANU Press, 1972, p. 146-7

25. Nolan, Janette, Op. cit., p. 91.

26. Kerr, J, op. cit., pp. 93-4

27. Birch, A, m/s History of the Australian Sugar Industry (Folio 3.0). Part 2, Chapter 4, "Emergence of the Central Mill", CSR Archives.

28. Newton, R, Work and Wealth of Queensland, 1897, p. 56.

29. Kerr, J, op. cit., p. 94.

30. Bolton, GC, Op. cit,. p. 155-6

31. Ibid., p. 2-304.

32. Newton, Op. cit, p. 55.

33. Bolton, GC, Op. cit,. p. 199.

34. Ibid. p. 201-2.

35. Moore, CR, Op. cit,. p.117.

36. Bolton, GC, Op. cit,. p. 233.

37. Ibid., p. 239.

38. Ibid., p. 249.

39. Moore, CR, Op. cit,. p.

40. Bolton, GC, Op. cit,. p. 303.

41. Moore, CR, Op. cit,. p. 114.

42. Bolton, GC, Op. cit,. p. 305.

43. Nolan, Janette, Op. cit., p. 146.

44. BV Balanzategui, Gentlemen of the flashing blade, Department of History & Politics, James Cook University, 1990.

45. Bolton, GC, Op. cit,. p. 324.

46. Nolan, Janette, Op. cit., p. 205.

47. Crellin, IR "Australian sugar tramways: the challenge of the 1980s" Light Railways No. 66, October 1979, p. 7.

48. Moore, CR, Op. cit,. p. 114.

49. Bureau of Agricultural Economics, Efficiency of transport, milling and handling in the sugar industry, BAE, Canberra, 1986, P. 9.

50. Kehan, D "Sugar Mill Tramways: an overview", Rail Australia, No. 5, November 1987, p. 32.

Bibliography

B. V. Balanzategui, Gentlemen of the flashing blade, Department of History & Politics, James Cook University, 1990.

G. C. Bolton, A Thousand Miles Away: a history of North Queensland to 1920, ANU Press, 1972.

Bureau of Agricultural Economics, Efficiency of transport, milling and handling in the sugar industry, BAE, Canberra, 1986

Crellin, I. R. "Australian sugar tramways: the challenge of the 1980s" Light Railways No. 66, October 1979.

CSR Company Records, Archives of Business & Labour, Canberra

Fitzgerald, R "Kanakas of our cane fields, then and now", Sydney Morning Herald, 27 Dec 1986

Jervis, J, "T. A. Scott and the Genesis of the Sugar Industry", RAHS Journal & Proceedings, Vol. 26, 1940, 387-396.

Lowndes, A. G. (ed), South Pacific Enterprise: the Colonial Sugar Refining Co. Ltd., Angus & Robertson, Sydney, 1956.

McSwain, E. H., The Sugar Industry on the Lower Clarence, Maclean District Historical Soc, Maclean, 1973.

Moore, C. R., Kanaka: a history of Melanesian Mackay, Uni PNG Press, 1986.

Moynagh, M, "Brown or white? a history of the Fiji sugar industry", 1873-1973, ANU Pacific Research Monograph No. 5, Canberra 1981.

Newton, R, Work and Wealth of Queensland, 1897.

Nolan, Janette, Bundaberg: history and people, University of Qld. Press, 1978.