Mossman Sugar Mill goes into voluntary administration despite $45 million in taxpayer funding

The Mossman Mill near Port Douglas has been operating for 127 years. (Supplied: Far Northern Milling)

Australia’s northernmost sugar mill has been placed into voluntary administration, despite a $45 million taxpayer-funded handout.

In 2018, more than 100 sugarcane growers formed a cooperative and bought Mossman Sugar Mill, north of Cairns, from previous owner Mackay Sugar, which had planned to shut it down.

The Queensland and federal governments chipped in $25 million and $20 million, respectively, which allowed Far Northern Milling (FNM) to become the first local group in Australia to buy back a sugar mill.

The money was supposed to guarantee the future of the 127-year-old facility and help it transition from producing only raw sugar to a bio-precinct capable of making food ingredients, alcohol, green chemicals and fertilisers.

But FNM’s parent company, Daintree Bio Precinct, has appointed liquidation firm Worrells to act as voluntary administrator of both companies due to “financial distress”.

In a statement to shareholders, chairman Rajinder Singh said the move to appoint a voluntary administrator was a “proactive step in the interest of the companies and the best chance of securing a future for Mossman Mill”.

“The appointment of the voluntary administrator does not mean the immediate cessation of all operations,” Mr Singh said.

The voluntary administrator will take control of both companies and meet with creditors, employees and stakeholders.

‘A real shame’

The Mossman Sugar Mill employs around 150 workers and is supplied by about 80 growers.

Douglas Shire Mayor Michael Kerr said after tourism, sugar was the region’s second-biggest industry.

He said any closure would have an enormous impact on the area.

“It’s not just the 150 odd people that work at the mill, you have hundreds of contractors that work there with families that live in Mossman,” Cr Kerr said.

“If this all collapses in a heap, we are going to lose the population, we’re going to lose facilities, and lose businesses, it will be a disaster.”