CSR working to restore operations at Pioneer Mill
  • CSR is working with growers to minimise disruption and re-commence operations at Pioneer Mill as soon as possible.

  • Investigations into cause of vessel collapse continue.

  • Construction of a replacement vessel is being fast tracked.

  • No material impact on CSR Sugar earnings.

  • Welcomes today’s QSL vote for restructure.

CSR and cane growers have continued their discussions in relation to the incident at Pioneer Mill where a clarification vessel collapsed last Friday, at a meeting today between a delegation of grower representatives and the Managing Director of CSR, Mr Jerry Maycock.

This follows meetings between cane growers and the CEO of CSR Sugar in the Burdekin on Monday and Tuesday this week.

“We share with growers the intense frustration that the temporary closure of the mill is causing in the region,” said Mr Maycock.

“However, CSR is doing everything we possibly can to try to minimise these impacts.”

CSR has announced that it will make cash advances available to Burdekin cane growers on a needs basis until crushing operations resume at the mill.

Meanwhile, cane from the Pioneer milling area is being transported to CSR’s three other Burdekin mills to be crushed until the Pioneer Mill is back on line. CSR is covering the additional transport costs for this exercise.

“We are working around the clock to minimise the downtime and re-commence operations at the Pioneer mill as soon as possible,” said Mr Maycock.

Incident Update

Contrary to some media reports, the incident at the mill on Friday was not an explosion. A cane juice clarification vessel collapsed causing damage to an adjacent vessel.

All evacuation plans worked effectively and no one was seriously injured in the incident.

Work to dismantle the vessels is expected to commence tomorrow and CSR and loss adjusters have retained forensic engineers to investigate the cause of the collapse. Until this investigation is complete, it is premature to speculate on the cause of the incident. In the meantime, construction of a new clarification vessel to replace the two damaged vessels has already commenced and is being fast tracked to ensure the mill is operational again as soon as possible.

On current, preliminary estimates, the Pioneer mill is expected to be closed for up to 14 weeks and the overall Burdekin cane crushing season may be extended by 2-3 weeks, given reasonable weather conditions.

CSR and its insurers are working together on site to assess the likely cost, how ever the total gross costs of the incident are expected to be significant and CSR will be lodging a claim.

Based on current estimates CSR believes the incident will not have a material impact on its Sugar earnings.

QSL vote

In a separate development today, CSR welcomed the result of the vote of members of Queensland Sugar Limited (QSL), the industry raw sugar marketing body, to restructure the organisation.

CSR is a strong supporter of a commercially focused single desk for the marketing and physical handling of Queensland raw sugar. This decision by QSL members enables the organisation to plan for the future with greater confidence.

CSR has actively promoted innovative medium term price risk management products for sugar cane growers and QSL will now be able to support such initiatives beyond the current season.

“CSR is two years into a three-year program to boost capital investment at its raw sugar mills to improve reliability and capacity. While this recent incident is certainly a setback, it has not dented our confidence in the future of our raw sugar business, nor our commitment to completing that program,” Mr Maycock said.