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d d n i . r e v o C Cover.indd 1 Sugar Research and Development Corporation

Annual Report 2005–2006

SRDC’s Core Business is: to foster an innovative and sustainable Australian sugar industry through targeted investment in research and development An innovative sugar industry will build capacity in people to…capitalise on and embrace advances in science, engineering and technology. A sustainable sugar industry will optimally combine the 3 Ps: profit (economy), planet (environment), and people (society). SRDC works in partnership with industry, government, R&D partners and associated rural communities to underpin a vibrant sugar industry with the object of achieving the Corporation’s Corporate Outcome: A profitable and internationally competitive Australian sugar industry providing economic, environmental and social benefits for rural and regional communities. SRDC strives to create an environment that recognises the value of innovation – change that adds value. SRDC invests in R&D activities to find new and improved ways of doing things rather than funding core or ongoing services. The Corporation is committed to setting the right targets, managing investments so they succeed and making sure research delivers impacts across the Australian sugar industry. In short, SRDC is firmly committed to maximising the return on industry and Government investment into research and development.

SSRDC_AR_05_06_01.inddRDC_AR_05_06_01.indd 1 112/10/062/10/06 11:18:0311:18:03 AMAM To the Parliamentary Secretary

28 September 2006

The Hon. Sussan Ley Parliamentary Secretary to the Minister for Agriculture, Fisheries and Forestry Parliament House CANBERRA ACT 2600 Dear Ms Ley, In accordance with the requirements of the Primary Industries and Energy Research and Development Act 1989 (the PIERD Act), I submit the Annual Report of the Sugar Research and Development Corporation (SRDC) for 2005–06. The activities of the Corporation are reported against the objectives, strategies, outputs and outcomes of the SRDC Research and Development Plan (R&D Plan) 2003–2008 and are consistent with the 2005–06 Annual Operational Plan and Portfolio Budget Statement. The report of operations included in the Annual Report has been made in accordance with a resolution of the Directors of SRDC on 25 August 2006. SRDC Directors are responsible under section 9 of the Commonwealth Authorities and Companies Act 1997 for the preparation and content of the report of operations in accordance with the Finance Minister’s orders. As required by the PIERD Act, the Board at its meeting in July 2005 reviewed SRDC’s R&D Plan 2003–2008. As you are aware, the R&D Plan was approved by Senator the Hon. Judith Troeth, the then Parliamentary Secretary to the Minister for Agriculture, Fisheries and Forestry in December 2002. The SRDC Board is confident that the R&D Plan 2003–2008 remains consistent with the reform initiatives and is continuing to provide a research and development framework to support the reform process. SRDC believes, and has received strong industry endorsement, that systems thinking and improved capacity for innovation, which are the hallmarks of the SRDC Plan 2003–2008, are necessary to ensure a sustainable future for the Australian sugar industry. I commend this report to you. Yours sincerely,

R G Granger Chair Sugar Research and Development Corporation

SSRDC_AR_05_06_01.inddRDC_AR_05_06_01.indd 2 112/10/062/10/06 11:18:0411:18:04 AMAM Contents

Page

Letter to the Parliamentary Secretary 2

1 SRDC Highlights 2005–06 5 1

2 OVERVIEW OF SRDC IN 2005–06 8 SRDC’s Business 8 The Australian Sugar Industry in 2005–06 10 Our People 11 2 Our Portfolio 12 Our Partners 14 Income and Expenditure 16 3 CHAIR AND EXECUTIVE DIRECTOR’S MESSAGE 17 3 4 REPORT OF PORTFOLIO OPERATIONS 21 SECTION 4A Achieving the SRDC Corporate Outcome and Addressing Government Priorities 22 SECTION 4B 4 Achieving SRDC’s Corporate Performance Measures 60

5 REPORT OF CORPORATE OPERATIONS 63 Legislative Framework 63 Corporate Governance Framework 65 5 SRDC Directors 68 Corporate Functions 74 Other Legislative and Reporting Requirements 77

6 FINANCIAL STATEMENTS 79 Independent Audit Report 80 6 Statement by Directors 82 Financial Details 83

7 APPENDICES Appendix A Current Research Project Listing (2005–06) 113 7 Appendix B Final Reports Approved (2005–06) 129 Appendix C Published Papers 135 Appendix D Freedom of Information Act Statement 139 Appendix E Abbreviations 141 Appendix F Table of Compliance with Publishing Guidelines and Legislation 143 8 Appendix G General Index 145

8 SELECTION COMMITTEE 147

SSRDC_AR_05_06_01.inddRDC_AR_05_06_01.indd 3 112/10/062/10/06 11:18:0511:18:05 AMAM ISSN. Copyright Sugar Research and Development Corporation 2006

PO Box 12050 Telephone: (07) 3210 0495 George Street Facsimile: (07) 3210 0506 Brisbane Q 4003 Email: [email protected] Web: http://www.srdc.gov.au

Text design and typeset by Sunset Digital Pty Ltd, Brisbane Cover design by AEC Group, Townsville Printed in Australia by Harding Colour, Brisbane

SSRDC_AR_05_06_01.inddRDC_AR_05_06_01.indd 4 112/10/062/10/06 11:18:0511:18:05 AMAM Section 1 SRDC Highlights 2005–06

In 2005–06, the Sugar Research and Development Corporation celebrated the following achievements 1 and successes with our industry and government stakeholders, research partners and members of the Australian sugar industry.

• SRDC supported projects which encouraged sugarcane growers to adopt new farming systems such as a minimum till legume rotation system. Growers in the Ord River Irrigation Area have increased the total hectares of fallow legume planted seven-fold over two years. Similarly 12 per cent of growers surveyed in New South Wales’ three mill areas indicated that they were in the process of implementing improved farming systems based on Sugar Yield Decline Joint Venture principles and a baseline survey undertaken in Queensland found that 23 per cent of growers had adopted this farming system (SRDC Project Codes: WAA003, NSC008 and BSS286) (refer to Section 4).

• Recognising that a cooperative approach is critical to facilitating whole-of-system change, SRDC funded a synthesis of Value Chain R&D (SRDC Project Code: CSE013) and hosted a Value Chain Workshop in Townsville in October 2005. In March 2006 the Hon. Sussan Ley MP, Parliamentary Secretary to the Minister for Agriculture, Fisheries and Forestry launched the publication The Value Chain of the Australian Sugar Industry: SRDC Technical Report 1/2006 (refer to Section 4).

• The detection of sugarcane smut in Queensland in June 2006 highlighted the need for investment into research aimed at improving biosecurity in the sugar industry. Over the last decade, SRDC has invested over $1.9 million in projects which are specifically aimed at managing a smut incursion and improving biosecurity in the sugar industry. Notably, SRDC supported the development of the Sugarcane Smut Contingency Plan for the Australian (PROSPER) have embraced best practice Sugar Industry, led by BSES Limited and recorded higher average returns (BSES), which was completed in 1997. per hectare – by about seven per cent This incursion plan was instrumental in – compared with those who did not guiding identification and containment participate in the group-learning program efforts. (SRDC Project Code: BSS260).

• A CSIRO-led, SRDC funded research • Cane growers who want to grow project completed in 2006 is influencing soybeans for grain as well as green thinking about irrigation of sugarcane manure welcomed the introduction of and will ultimately change the way a new variety – Stuart, which is broadly cane farmers apply irrigation water. The adapted to planting in both the wet and capability developed during the project the dry season in the tropics and to (SRDC Project Code: CSE001) to apply planting from South East Queensland water at the optimum time has been well through to North Queensland. Stuart was received and has the potential to assist released thanks to a CSIRO led project growers with seasonal planning of water with partnership SRDC funding (SRDC use (refer to Section 4). Project Code: CPI005).

• A revolution in the payment for harvesting • Grower Group Innovation, Travel and has resulted in growers and harvesters Learning Opportunity and Scholarship working together to improve productivity Projects made a positive mark on and profitability. A BSES-led project more than 400 individuals in the sugar resulted in rapid adoption of a relatively industry, helping to build industry and straight-forward and easily-implemented human capacity for change; learning and system based on payment for tonnes innovation (refer to Sections 2 and 4). of cane delivered plus the costs of fuel • to be paid directly by the farmer. This Bagasse and trash, by-products of the system has been widely implemented sugarcane milling process, are under across the Australian sugar industry, and increasing evaluation as potential sources has given farmers greater incentive to of revenue for the industry. In 2005–06 reduce the costs of harvesting (SRDC SRDC funded an analysis of the costs, Project Code: BSS261). risks and benefits of implementing each of the known bagasse and trash • With research showing that an effective utilisation options. This project will way to increase rate of adoption of more help industry assess options for using profitable and sustainable practices bagasse and trash as an alternative on Queensland sugarcane farms is to revenue source. encourage farmers to work together in • groups, SRDC is funding the facilitation Over 100 members of the next of such groups. Burdekin participants generation of leaders in Australia’s sugar who took part in a BSES-led program industry took advantage of opportunities

6 SUGAR RESEARCH AND DEVELOPMENT CORPORATION available through the SRDC supported and capable people. In 2005–06, SRDC Generation Next program to learn the partnered with industry and researchers skills that will help them make an impact to encourage greater participation by on the industry well into the future (refer women, and SRDC projects resulted in 1 to Section 4). over 50 women taking a greater role in the sugar industry. • Cane farmers now have access to practical tools for risk assessment and • Partnerships across rural industry for reporting on implementation of best Research and Development Corporation management practices for cane farming, have delivered cross-industry links. In produced by Agrecon as part of a 2005-06 SRDC was a partner to several project to develop a framework for Farm RDC Joint Ventures: Management Systems. This project is — the Cooperative Venture for Capacity assisting cane growers to produce their Building for Innovation in Rural own farm management systems based Industries; on Environmental Management System — the Climate Variability in Agriculture principles (SRDC Project Code: FMS001). R&D Program; and • The future profitability and sustainability — the Farm Health and Safety Joint of the sugar industry depends on skilled Research Venture.

ANNUAL REPORT 2005–2006 7 Section 2 Overview of SRDC in 2005–06

SRDC’s business

SRDC invests in research conducted by others rather than carrying out research itself. SRDC takes a strategic view of the needs and opportunities for R&D in the sugar industry, based on feedback from industry and Government, then sources and funds appropriate R&D activities to pursue these opportunities.

SRDC is part of a larger network of R&D Corporations (RDCs) who similarly invest in the conduct of R&D to produce beneficial outcomes for Australian rural industries. The features of the RDC model, on which SRDC is based, are outlined below.

Features of the R&D Corporations Model

• The rural R&D Corporations (RDCs) take a leading national role in planning, investing in and managing R&D for their respective industries. • RDCs are not research ‘grant’ agencies. Their enabling legislation requires them to treat R&D as an investment in economic, environmental and social benefits to their industries and to the people of Australia. • Rather than focussing mainly on generating new knowledge for its own sake, RDCs strive to deliver high rates of return on R&D investment by influencing the full range of interactions along the innovation chain. • Striving for high returns on investment also leads RDCs to apply significant resources to translating research outputs into practical outcomes. • RDCs are required to conduct their activities in accordance with strategic R&D plans and annual operational plans that take account of the R&D needs of end-users and other stakeholders. The plans are approved at ministerial level. • Although RDCs fund basic research, a high proportion of activity is applied R&D – both short-term and long-term. • RDCs are fully accountable to their major stakeholders and to the wider community. SRDC invests in R&D projects which are SRDC obtains income from levies paid by categorised under the four programs of the the sugar industry, matching funds from R&D Plan 2003–2008; these are described the Australian Government, and interest. in Table 2.1 below. More information about The levy in 2005–06 remained at $0.14 the outputs and outcomes of each program per tonne of sugarcane harvested, divided are highlighted in Section 4. equally between growers and millers.

Table 2.1 Programs of the SRDC R&D Plan 2003–2008 2 Program Title Goal Target Profile (% of total R&D investment)

A Value Chain Integration Adoption of whole-of-system solutions based 20–25 on integrated management of the value chain, particularly at mill area and regional levels

B Farming Systems Adoption of sustainable sugarcane 45–50 production systems based on integrated management of resources at farm level

C Processing and Adoption of flexible cost-effective systems 15–20 Distribution Systems for sustainable harvest, transport, milling and marketing based on innovative design

D Industry Capacity Building human capacity for change, learning 10–15 and innovation in the sugar industry

ANNUAL REPORT 2005–2006 9 The Australian sugar The area harvested decreased slightly in industry in 2005–06 2005–06. However, cane production and sugar yield both increased compared to Raw sugar is produced from sugar cane the previous year. Industry income, as in Queensland, New South Wales and measured by GVP, increased, reflecting the Western Australia. The area and amount increased return per tonne received for the of cane harvested, sugar yield and gross 2005 harvest. value of production of sugarcane (GVP) for the Australian sugar industry since 1994 are presented in Figure 1.

Figure 1: Production and income data for the Australian sugar industry (since 1994)

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Credit: Australian Sugar Cane Annual 2006

10 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Our people SRDC has five full-time and four part-time staff in addition to the Executive Director. SRDC is managed by a Board consisting Full details of SRDC staffing are provided in of a Chair, an Executive Director, a Section 5. Government Director, and six non-executive Directors. Directors other than the Executive Two part-time Project Officers were Director are appointed by the Parliamentary appointed in 2005–06 to support grower Secretary to the Minister for Agriculture, groups successful in obtaining funding Fisheries and Forestry. The Executive to undertake Grower/ Harvester Group 2 Director is appointed by the Board. Innovation Projects. Andrew Lashmar, based in the Burdekin supports grower Following the appointment of five non- groups in the north of Queensland, while executive Directors in the 2004–05 Financial Joe Muscat, based in Mackay, supports Year, the sixth non-executive Director groups in the central and southern areas was appointed on 28 April 2006. A letter of Queensland and northern areas of New outlining this process is included as the final South Wales. page of this report.

The SRDC Board is responsible for the stewardship of the corporation, and oversees corporate governance within SRDC.

ANNUAL REPORT 2005–2006 11 Our portfolio GGIP and TLOP projects represented only a small portion of SRDC’s total R&D investment The PIERD Act requires SRDC to make in 2005–06; however they have made a effective use of Australia’s scientific positive mark on the industry by building resources. SRDC continues to create an industry and human capacity for change, environment which encourages the adoption learning and innovation. More than 400 and implementation of innovative ideas, individuals in the sugar industry were involved technology and practices to achieve social, with these projects this financial year. environmental and economic benefits within the Australian sugar industry. Research Projects continued to represent the largest proportion of projects, with 90 The strategy for SRDC’s investment per cent of research investment directed decisions is identified in consultation with towards these projects. The proportion of industry and government stakeholders and is funding allocated to each project type is set out in the SRDC R&D Plan 2003–2008. represented in Figure 2.2.

SRDC ensures that the quality of projects At SRDC regional workshops conducted and the continued focus on priority industry in 2005–06, participants from across the and community issues is maintained industry were invited to provide feedback via collaborative planning of proposals, on the value of SRDC investments in their transparent project selection and monitoring region. Ninety-one percent of respondents systems and effective feedback to all project indicated they thought SRDC investments proponents. were valuable, quite valuable or very valuable. SRDC seeks approximately 50 per cent collaborative funding of R&D projects from research and/or industry organisations. This At SRDC regional workshops conducted in reflects SRDC’s preferred funding model, ‘2005–06, participants from across the industry were of a partnership in R&D which requires invited to provide feedback on the value of SRDC substantial agreement on R&D priorities investments in their region. Ninety-one percent between SRDC, researchers and industry. of respondents indicated they thought SRDC In 2005–06, SRDC continued to broaden its investments were valuable. investment portfolio, with the introduction of smaller value projects such as Harvesting The successes, outputs and outcomes’ Group Innovation Projects (HGIP) and from SRDC’s investments in 2005–06 are Grower Group Innovation Projects (GGIP). documented in Section 4. Travel and Learning Opportunity Projects (TLOP), which were introduced in 2004–05, also continued to attract industry support.

12 SUGAR RESEARCH AND DEVELOPMENT CORPORATION 2

Following a call for project proposals, made annually in July, SRDC-appointed Working Parties which include representatives from industry, government, research and extension provide advice to the SRDC Board on the proposals received.

Table 2.2 SRDC Project Statistics as of Figure 2.2: Proportion of SRDC project 30 June 2006 types by funding as at 30 June 2006 2005–06 2004–05 HX]daVgh]^eh IADE!(#& '#( Research Projects 105 91 <<>E!)#' Scholarships 15 11

Grower/Harvester Group 18 — Innovation Projects1 GZhZVgX]Egd_ZXih! .%#( Travel and Learning 57 27 Opportunity Projects

Project investigators 433 388

Research partners 111 77

1 GGIP and HGIPs commenced in 2005–06.

ANNUAL REPORT 2005–2006 13 Our Partners In 2005–06, SRDC contributed to several initiatives in partnership with the Department SRDC worked closely with all research of Agriculture, Fisheries and Forestry and partners throughout 2005–06 to ensure an other Rural R&D Corporations, including: efficient and effective process was in place to complete all research projects in a timely • the Department of Agriculture, Fisheries manner. and Forestry’s Industry Partnerships Corporate Governance for Rural Women SRDC aims to facilitate collaboration Initiative; between industry organisations, industry participants and regional committees, • the Science and Innovation Awards for industry research bodies, scientific Young People in Agriculture, Fisheries and academic institutions and private and Forestry; organisations. • the Cooperative Venture for Capacity The success of this approach is Building for Innovation in Rural Industries, demonstrated in Table 2.2, which highlights and; the dramatic increase in the number • of research organisations involved in the Joint Ventures for Farm Health and SRDC-invested projects in 2005–06. As Safety and Managing Climate Variability. the number of collaborative projects (which SRDC is a member of, and provides the may have one organisation taking a lead secretariat for, the Sugar R&D Alliance, role with many others involved throughout a voluntary association of key industry the life of the project) increases, so too does and R&D organisations serving the sugar the sharing of ideas and resources across industry. It monitors resource allocation all sectors of the Australian sugar industry on a whole-of-industry basis and fosters value chain. cooperation among sugar R&D providers SRDC is a core party of the Cooperative to deliver improved industry profitability and Research Centre for Sugar Industry sustainability Innovation through Biotechnology (CRC SIIB) along with BSES Limited, CSIRO Plant Industry, Southern Cross University, and The University of Queensland. The CRC commenced in August 2003 with a mission to increase the value of Australian sugarcane by developing and delivering new plant varieties, products and processes through the application of biotechnology.

14 SUGAR RESEARCH AND DEVELOPMENT CORPORATION SRDC Regional Workshops — helping set the direction for SRDC

More than 440 people involved in all areas of the Australian sugar industry attended one of SRDC’s regional workshops in 2005–06 and had the opportunity to provide advice into the needs of the local industry.

These workshops were aimed at identifying strategic issues and new opportunities to address the key outcomes of the SRDC R&D Plan 2003–2008, and facilitating communication between SRDC and industry participants.

Feedback from industry, together with feedback received from Government, Representative Bodies and R&D organisations, will be fed into SRDC’s planning cycle. 2 The strong message from attendees was the need to have more of a regional and mill area focus to R&D investment, acknowledging that regions and mill areas are different and that R&D solutions need to be tailored to the different needs and capabilities in different regions.

Industry also indicated that there is an ongoing need for greater investment in strategic research, along with greater emphasis on user-driven R&D.

There was also strong support for the continued development of the industry’s people, particularly in business skills, R&D capability, the next generation, and women.

Participants were also encouraged to provide feedback on the value and relevance of SRDC projects in their region. The results of this feedback are represented below.

Response to the question: ‘How valuable are SRDC’s investments in your region?’ — percentage of responses ranked ‘Valuable’ to ‘Very valuable’.

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ANNUAL REPORT 2005–2006 15 Income and expenditure industry benefits in an uncertain future industry environment. Future crop size will SRDC’s income and expenditure for 2005–06 vary due to influences of climate, smut compared to that forecast in the Annual incursion, industry reform and restructuring Operational Plan are set out in Table 2.3, Future sugar prices are also uncertain and below. Full financial statements are included this will affect future GVP. SRDC’s policy in Section 6. is to maintain cash reserves above 50 per cent of the following year’s expenditure, Income in 2005–06 was slightly higher and this will cover any unplanned operating than forecast and expenditure both on deficit as a consequence of crop size and R&D projects and operations was lower GVP being lower than forecast. than forecast. Consequently, SRDC’s cash reserve at 30 June 2006 increased The distribution of project funding across to $8.149 million. The SRDC Board has the SRDC’s four programs is illustrated in approved increased expenditure at $11.981 Figure 2.3. million in 2006–07 which is forecast to reduce cash reserves by $1.309 million. Allocations across the four programs were aligned to those targeted in the SRDC R&D Nevertheless, SRDC’s cash reserves are Plan 2003–2008. This is an excellent result forecast to be 54 per cent at the end of with the movement of the portfolio achieving 2006–07 to ensure that long term R&D the targeted goals well within the term of commitments can be realised to maximise the plan.

Table 2.3 Forecast and actual income Figure 2.3: Distribution of project and expenditure for 2005–06. funding as at 30 June 2006

Forecast Actual KVajZ8]V^c $m $m >ciZ\gVi^dc &* Income: >cYjhign8VeVX^in &. Industry Levies 5.252 5.342

Australian Government 4.919 5.195

Contribution ;Vgb^c\ EgdXZhh^c\VcY HnhiZbh Other .370 .588 9^hig^Wji^dc ). HnhiZbh Total Income 10.541 11.125 &,

Expenditure:

R&D Projects 9.761 8.610

Operation of SRDC 1.704 1.549

Total Expenditure 11.465 10.159

16 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Section 3 Chair and Executive Director’s Message

2005–06 again presented the Australian sugar industry and the Research and Development Corporation (SRDC) with numerous opportunities and challenges throughout which SRDC maintained its focus on targeting R&D investment to underpin a profitable and sustainable sugar industry.

The nature of the sugar industry’s operating environment in 2005–06 commenced with the low sugar prices of 2004–05, followed by a three-fold 3 increase in sugar price. With the majority of its production still exported, the Australian sugar industry needs to operate in an increasingly volatile global market. Already in 2006–07, sugar prices have fallen significantly from the highs of 2005–06.

With the deregulation of sugar marketing and the cessation of pooling in 2005–06, there is likely to be increased price volatility across cane producing regions, with the need for industry participants to increasingly manage market risk at the enterprise and mill area level.

Production volatility was also significant in 2005–06. The initial low price environment also limited new planting resulting in longer ratoon cycles.

Drought limited production in some areas, while in March 2006, Tropical Cyclone Larry damaged crops in far north Queensland. This event, combined with subsequent low radiation conditions, associated with prolonged wet conditions, will have a negative effect on production in the coming year.

Sugarcane smut was diagnosed in southern Queensland in June 2006. This was the first known case of the disease in eastern Australia, although it had previously been found, and managed, in the Ord River Irrigation Area in Western Australia in 1997–98. Over the last decade, SRDC has invested over • Is our R&D portfolio appropriately $1.9 million in projects which are specifically balanced across industry sectors and aimed at managing a smut incursion and across the shorter and longer-term improving biosecurity in the sugar industry. horizons?

Such volatility in sugar price and exchange • Is the Corporation delivering on sugar rate, and the impacts of climatic events industry priorities and the Australian and disease incursion, reinforced the need Government’s national and rural industry to continually innovate to manage risk and priorities? sustainably increase revenues and lower costs. The Corporation’s Research and Development Plan 2003–2008 helps SRDC A key feature of SRDC’s investment portfolio maintain its focus on delivering on priority in 2005–06 was the increased emphasis on outcomes through targeted R&D funding. participative and industry driven R&D that This Plan is supported by an annual used a systems approach. program of meetings with the Parliamentary Secretary, SRDC’s Representative Bodies This has delivered significant integrated and regional workshops which provide economic, environmental and social opportunities for industry to actively engage outcomes as highlighted in this Annual in driving R&D priorities. Report. SRDC has been encouraged by the increase in interaction between the research In 2005–06, SRDC met close to 1000 community and growers, harvesters and members of industry in regional workshops, millers. We have welcomed the enthusiasm industry forums and a variety of other and commitment of our research partners opportunities. Feedback, information and in trying to proactively achieve change for a suggestions offered by participants at these more profitable and sustainable industry. events were fed into the Corporation’s planning cycle. The increasing participation Partnerships between industry, researchers, of a wider cross-section of the industry in the community and SRDC were critical the regional workshop series will remain an to the achievement of success and to ongoing focus for SRDC. the performance of our R&D investment portfolio. The need to measure success and Through these meetings, forums and deliver a sound return on R&D investment workshops, SRDC was able to share to stakeholders remained at the forefront of success stories and reaffirm its focus on operational focus. farming systems, value chain integration and building the capacity of the industry’s SRDC measures success against a range of people. performance indicators; described in detail in this Annual Report. However, there are The implementation of new farming three overarching questions: Are our R&D systems has been a major success investments well targeted to and responsive story for the industry, with uptake to priority needs? and implementation of change for

18 SUGAR RESEARCH AND DEVELOPMENT CORPORATION improved productivity and economic and Capacity building and the development environmental performance continually of the skills and abilities of the industry’s gaining momentum. The rise in submissions people is another area of significant for Research Projects and Grower achievement and positive results. Travel Group Innovation Projects in 2005–06 and Learning Opportunity Projects (TLOP) demonstrated the enthusiasm of growers, continued to provide sugar industry people harvesters and millers to work with research with an opportunity to build their capacity partners to undertake research at the for leadership, learning and/ or change by on-farm level. Dedicated innovators were conducting a targeted activity or through keen to show industry counterparts the travel. successes that could be achieved with the adaptation of new or modified farming While TLOP projects represented less than systems to local conditions. three percent of the Corporation’s total R&D spend, they have proved to be successful in 3 The spirit of collaboration and cooperation increasing the adoption of changed practice was also evident in work undertaken and in the enhancement of partnerships to improve the sugar industry value between industry, research and regional chain. It was broadly recognised that communities to underpin learning and there were considerable revenue gains innovation. and cost savings available through value chain improvements, but a key driver was SRDC’s investment in the Generation Next people’s willingness to change. Forum and in various leadership projects has also helped industry people realise new SRDC hosted a Value Chain Forum and opportunities to improve their performance. Workshop, in Townsville in October 2005. SRDC is particularly keen to strengthen our This brought together more than 80 partnerships and seek innovative ways to industry participants including growers, improve the skills of industry participants to harvesters, transport operators, millers and embrace mutually beneficial change. marketers as well as the RD&E community. Participants were all people with the The Australian Government’s industry reform expertise, experience and willingness to program was a dominant influence in invest in R&D in their region and to improve 2005–06 with the release of the Industry value chain integration to reduce costs and Oversight Group’s Strategic Vision of increase productivity. ‘A commercially vibrant, sustainable and self-reliant raw sugar and sugarcane SRDC also hosted a Bagasse and Trash — derived products industry, through: Utilisation Forum in May 2006 to identify both committed cane growers and millers new opportunities for biomass utilisation being responsive to international and from the sugarcane plant. SRDC is domestic market forces; and operating in committed to exploring diversification an open, deregulated industry environment, opportunities that complement the within Australia’s corporate governance production of raw sugar. framework.’

ANNUAL REPORT 2005–2006 19 As part of the reform program, Regional Allocation of increased funding to strategic Advisory Groups have also developed research, will ensure technologies and Regional Plans. approaches continue to be generated to meet the globally competitive pressures that SRDC’s investments have been closely the Australian sugar industry will face in the aligned with the needs of industry reform future. and aim to be a catalyst for beneficial change. SRDC acknowledges the need Through a greater emphasis on partnering to address regional priorities, recognising to foster enthusiasm and motivation of that R&D solutions need to be tailored to those involved in all aspects of R&D, SRDC accommodate the needs and capabilities of will be able to continue to deliver improved each region and mill area. performance and positive outcomes which will help to establish Australia’s sugar As we look to the future, industry will have industry as a profitable, productive and numerous opportunities to embrace new sustainable, industry well into the future. technologies and new ways of thinking which are underpinned by R&D to keep competing in the global market. SRDC will maintain its focus on R&D targeted towards the implementation of solutions within and across different sectors of the industry value chain.

SRDC remains committed to changing the way that it does business to capitalise on opportunities and deliver better industry outcomes. In 2006–07, SRDC will develop its R&D Plan 2007–2012. This planning Bob Granger (left) SRDC Chair, Russell Muchow process presents the opportunity for SRDC (right) SRDC Executive Director with Parliamentary to further refine its R&D investment targets Secretary, the Hon. Sussan Ley. and strategies to achieve beneficial impacts.

SRDC will place greater emphasis on aligning funding with Regional and Mill Area priorities in recognition of the significant Mr RG Granger gains that can be made in these areas, while still maintaining a balanced R&D portfolio.

SRDC also recognises the need to invest Dr RC Muchow in strategic and forward-looking research. Executive Director

20 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Section 4 Report of Portfolio Operations

SECTION 4A Achieving the SRDC Corporate Outcome and addressing government priorities SRDC delivered on six Key Outcomes in 2005–06, to deliver on its Corporate Outcome:

A profitable and internationally competitive Australian sugar industry providing economic, environmental and social benefits for rural and regional communities.

SECTION 4B Achieving SRDC’s corporate performance measures 4 Five performance measures and indicators were used to assess the effectiveness of SRDC’s R&D programs in achieving its Corporate Outcome and implementing its R&D Plan 2003–08. Section 4A Achieving the SRDC Corporate Outcome and Addressing Government Priorities The SRDC Corporate Outcome is:

A profitable and internationally competitive Australian sugar industry providing economic, environmental and social benefits for rural and regional communities.

To achieve this, SRDC is striving to deliver the six Key Outcomes, identified in the R&D Plan 2003 – 2008, through the partnerships built and maintained with stakeholders.

SRDC Key Outcomes Key Outcome 1 An increasing and more reliable cane supply, primarily through the implementation of robust farming systems that enhance economic and environmental performance, and are less vulnerable to the impacts of adverse factors such as disease and climate variability;

Key Outcome 2 Facilitation of change which promotes adoption of whole-of-system solutions to enhance revenue and cost efficiency across the value chain at mill area and regional levels;

Key Outcome 3 Demonstration of environmental sustainability to the satisfaction of all stakeholders;

Key Outcome 4 Diversification of the income stream from products derived from sugarcane;

Key Outcome 5 Enhancement of human capacity and partnerships between industry, research and regional communities to underpin change, learning and innovation;

Key Outcome 6 An effective R&D capability underpinning industry futures.

These six Key Outcomes, delivered through four Program Areas, provide the framework for how SRDC investments are contributing to the National Research Priorities and the Rural R&D Priorities of the Australian Government, which were announced in December 2002 and March 2003 respectively.

The Rural R&D Priorities are framed within the National Research Priorities and focus on issues relevant to rural industries.

22 SUGAR RESEARCH AND DEVELOPMENT CORPORATION In addition to these two sets of priorities, SRDC is also guided by Industry Priorities. These priorities are outlined in the SRDC R&D Plan 2003–2008 and were determined by industry stakeholders after consideration of the current state and external environment of the Australian sugar industry.

The four industry R&D priorities are:

• whole-of-industry profitability through exploitation of opportunities for better integration across the value chain to ensure enhanced revenue and increased cost efficiency;

• an economically, environmentally and socially sustainable industry that has sustainable farming, harvesting, processing and distribution systems and efficient and effective marketing systems for Australian sugar;

• an efficient and effective RD&E capacity that collaborates strongly across R&D providers and with the various components of the industry value chain; and

• attraction and retention of people who are talented, well trained and committed to the sugar industry 4A Table 4.1 identifies the composition of Government research priorities attributed to each SRDC Program Area. This table also documents the relationship between each Program Area and Key Outcome as established in the SRDC R&D Plan 2003–2008.

An overview of SRDC Program Areas, as well as the performance of each against specific indicators, is provided in Table 4.2.

Section 4A outlines SRDC’s investment activities in 2005–06 using the six Key Outcomes of the SRDC R&D Plan and highlights some key achievements in each outcome area.

ANNUAL REPORT 2005–2006 23 Other Research Safeguarding Safeguarding Australia Protecting Protecting Australia Invasive from Diseases and Pests Creating an Creating Innovative Culture Frontier Technologies Technologies Frontier for Building and Transforming Australian Industries Use of Frontier Technologies Improved Improved and Trade Market Access Maintaining & Improving Confidence in the Integrity of Australian Agricultural … Products Promoting and Maintaining Good Health Promoting social & economic Australia’s (strengthening fabric) Improving Improving Competitive- ness through a Whole of Industry Approach --94111----4013394---- 53 3 79 1 20 1 4 1 500 6 80 1 - - - - $%$%$%$%$%$%$%$% 244 3 79 1 20 1 - - 58 1 1,201 14 22 1 15 1 1,753 20 39 1 168 2 44 1 1,166 14 846 10 153 2 - - An Environmentally Sustainable Australia Sustainable Natural Resource Management Table 4.1 Composition of Government Research Priorities attributed to each R&D Program ($,000 and % values) – 2005–06 4.1 Composition of GovernmentPriorities attributed to each R&D Program Research Table Priorities National Research (NRP) & Rural Research Development Priorities (RRDP) Program D Program Industry Capacity SRDC Key Outcomes 5 and 6 Program A Program Chain Integration Value SRDC Key Outcomes 2 and 4 B Program Farming Systems SRDC Key Outcomes 1 and 3 C Program and Distribution Processing Systems SRDC Key Outcomes 2 and 4 TOTAL 2,052 24 1,850 22 232 4 48 1 1,766 21 2,469 29 176 3 15 1

24 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Table 4.2 SRDC Program Areas – performance against indicators and measures identified in the Annual Operational Plan 2005–06 Program A Program B Program C Program D

Focus Value Chain Integration Farming Systems Processing and Industry Capacity Distribution Systems

Outcome Increased efficiency Robust production More productive A skilled human and overall profitability systems that are and cost-effective resource base and of the industry as both profitable and processing and enhanced industry R&D an integral part of in harmony with the distribution systems capacity focussed on sustainable regional environment and in harmony with the delivery of economic, development. societal expectations. environment and environmental and societal expectations. societal benefits.

Output Whole-of-system Sustainable sugarcane Flexible, cost-effective Enhanced human solutions based on production systems systems for sustainable capacity for change, integrated management based on integrated harvest, transport, learning and innovation of the value chain, management of milling and marketing in the sugar industry. particularly at mill area resources at farm level. based on innovative and regional levels. design. 4A Program specific indicators and measures (identified in the SRDC Annual Operational Plan 2005–06)

Indicator: Accountability to SRDC of its research providers through monitoring project milestones, financial reporting requirements and reviews to ensure delivery of output.

Milestone reports 40 106 53 153 approved

Final reports 822543 approved

Indicator: At least one review completed in each Program

3302

Indicator: Number of continuing projects

Target 14 27 13 34

Actual 14 27 13 49

Indicator: Number of new projects

Target 4 8 4 18

Actual 7 27 16 47

Indicator: Number of continuing scholarships

Target Not applicable Not applicable Not applicable 9

Actual Not applicable Not applicable Not applicable 9

Indicator: Number of new scholarships

Target Not applicable Not applicable Not applicable 4

Actual Not applicable Not applicable Not applicable 5

ANNUAL REPORT 2005–2006 25 An increasing and more reliable cane supply

Key Outcome 1: An increasing and more reliable cane supply, primarily through the implementation of robust farming systems that enhance economic and environmental performance, and are less vulnerable to the impacts of adverse factors such as disease and climate variability.

Enhancing cane supply and maximising The improvement is due to the use of one returns per unit of costs is the key to photoperiod facility specifically for making improved profitability in the sugar industry, smut-resistant crosses, changes in the and has become more critical in recent crossing database, planting of more plots years due to the impact of fluctuating sugar of resistant parents and direct intervention prices, drought, disease and alternative land by the plant breeders. These changes are uses on sugarcane production. starting to filter through to the selection program with an increasing percentage Systems thinking and a focus on the of clones from resistant and intermediate implementation of changed practice crosses in the early selection stages. have been critical to success. Whilst acknowledging the economic imperatives, One smut resistance screening trial in farming practices also need to integrate Indonesia was completed in 2005–06, elements including variety selection, water giving reliable ratings for the 277 clones and nutrient inputs, pest management included in the trial. A third of the clones and timely operations into a workable and in the trial were rated as intermediate to robust package to minimise impacts on the resistant to smut. This was the eighth trial environment and other ecosystems. in the series of smut resistance screening trials conducted as part of this series of Key achievements projects. Trial nine was planted in November Enhancing sugar industry biosecurity 2005 with 255 clones. The trial has germinated well and inspections for smut The appearance of sugarcane smut in have commenced, with early inspections southern Queensland in mid-2006 highlighted suggesting that this will also achieve clear the importance of the series of biosecurity discrimination between susceptable and projects funded by SRDC and led by BSES resistant clones. Limited on selecting cane varieties for resistance to this fungal disease and other This information on the level of susceptibility diseases of cane. to smut of all currently-available cultivars of sugar-cane will assist farmers to manage the There was a dramatic shift in the proportion outbreak of this devastating disease of cane. of smut-resistant crosses made in the In some areas such as the Burdekin and 2005 crossing season with 21 per cent New South Wales, new highly-productive of crosses rated as resistant and 41 per varieties that are resistant to smut are cent intermediate. This is a significant already widely grown. improvement from previous years, when SRDC Project Code: BSS256, BSS265 less than five per cent of crosses were rated as resistant.

26 SUGAR RESEARCH AND DEVELOPMENT CORPORATION From 2002 to 2005, BSES, in collaboration with an expert on predicting population with the CRC for Tropical Plant Protection, changes of insect pests from the USA, undertook an important and timely project Dr Frank Drummond. which has provided information about the genetic diversity in two serious pathogens In 2006, Greyback canegrub populations (smut and orange rust) in the Australian were surveyed in 72 fields in Northern and sugar industry. Understanding issues of Central Queensland. Cyclone Larry and a genetic diversity is an important element of prolonged wet season caused considerable successful disease-management strategies difficulties with the work in the far north. and the deployment of resistance. The The survey indicated that district-wide findings of this project have contributed populations are similar to last year. significantly to the robustness of the In a related project, BSES collaborated BSES/CSIRO breeding program. with groups of growers to identify fields SRDC Project Code: BSS258 to be planted in 2005 to study population dynamics and management of Greyback and Childers canegrubs.

4A

The results of SRDC funded projects focused on Pressurised canisters designed by BSES Research selecting cane varieties for resistance to smut are Assistant Tim Staier allow variable rates of liquid helping the industry adapt, following the detection products to be applied in canegrub trials in new of this fungal disease in Queensland in June 2006. farming systems.

Canegrubs are the most serious insect The development of Childers grub pests of sugarcane in Australia. Outbreaks populations over time is being studied to of the pest have been difficult to forecast, develop a suitable monitoring system for and this BSES-led project seeks to develop growers. Numbers of small grubs are being a predictive system so that the outbreaks counted in autumn as an indicator of risk can be managed better with less economic from damaging third instars the following loss to the industry. The researchers worked summer.

ANNUAL REPORT 2005–2006 27 Autumn sampling for Childers grubs allows that integrates economic and biological growers the time to make appropriate data to maximise genetic gain for industry management decisions, for example when economic value. to harvest, whether to ratoon or plough out a field, and whether ratoon treatment with In 2005–06, the project focused on determining the economic importance of insecticide is likely to be warranted after sugarcane traits for sugar, electricity and harvest. ethanol under five regional production SRDC Project Code: BSS257 and BSS266 systems. With the involvement of a very Survival of the fittest — improving supportive industry, detailed economic models selection in breeding were built for the North, Herbert, Burdekin, Central and South regions and sugarcane Selection represents a costly and critical traits, including sugar content, cane yield, fibre part of sugarcane breeding programs. It is content and quality, sugar quality and disease a process not without its own challenges. resistance, were considered. The values measured for each clone may be strongly influenced by environmental and From these models, economic weights for non-genetic components, including effects sugarcane traits were derived. A framework of competition in small plots. An SRDC- of economic models for co-production funded project has helped identify optimal (sugar and electricity, sugar and ethanol) selection system designs, data analysis was also established; the economic importance of sugarcane traits can now be and selection criteria to improve the rate of readily estimated. genetic progress. SRDC Project Code: BSS267 Adoption of recommendations from this Also making the link between the potential project should result in improved results in for improved performance through Australian sugarcane-breeding programs in exploiting interactions between genetics the medium (within five years) and longer and management, an SRDC project led by (five to ten years) term. CSIRO Sustainable Ecosystems aims to increase CCS, cane yield and water use The key outputs will be greater genetic gains efficiency. and the faster release of improved varieties. Those involved with the project are hoping to In the first year of the project, irrigation improve the rate of genetic gains contributed pot trials have been established in the tall by the current Australian sugarcane-breeding plant facility at CSIRO Davies Laboratory in program by at least 10 per cent. Townsville. This experiment demonstrated SRDC Project Code: BSS250 that plant extension growth could be accurately controlled through irrigation and As well as field productivity, researchers must temperature manipulation. also consider the economic performance of sugarcane in breeding programs. A BSES-led This study illustrates the value of water project is developing a genetic evaluation and to the industry and the importance of selection system for sugarcane improvement putting more resources into efforts to use

28 SUGAR RESEARCH AND DEVELOPMENT CORPORATION irrigation water more cost-effectively. These open discussion on varietal characteristics, efforts could lead to better access to experiences (both good and bad) with water for irrigation, more efficient irrigation, major varieties under varying conditions, and breeding for drought tolerance and major management factors influencing improved water use efficiency. plant growth and maturity, the derivation SRDC Project Code: CSE014 and application of relative payment, and aids to management of harvesting. Each section was enhanced with a practical exercise designed to encourage discussion and identify considerations, opportunities, hazards, options and outcomes.

This TLOP was very timely, with workshops occurring before the outbreak of sugarcane smut. To assist in the management of the disease growers will need to rapidly replace susceptible varieties. SRDC Project Code: BSS283 4A A TLOP coordinated by members of the Women in Sugar group through CSIRO’s Dr Geoff Inman-Bamber is hoping to increase CCS, cane yield and improve water use CANEGROWERS Bundaberg helped efficiency. 45 participants, including 20 women, increase their skills, capability and Improving variety management confidence to undertake their own and integrated pest management integrated pest management (IPM) and in Bundaberg bug checking on their farm, specifically in Two Travel and Learning Opportunity rotational legume break crops. Projects (TLOP) have helped increase Participants can now identify major pests Bundaberg growers’ understanding of and beneficial insects in rotational soybean variety management and integrated pest crops, sample insects in soybeans using management. recommended methods, review when Focused on developing best management soybeans are at greatest risk and know practice for varieties, a series of workshops when to apply IPM for insect control in led by BSES assisted Bundaberg growers soybeans. achieve maximum productivity and financial The long-term outcomes of this project are potential from selecting and managing still being measured. These include the wise sugarcane varieties according to the local use and potential reduction in pesticide use environment and harvest opportunities. on farm and improved viability of legume Five workshops were conducted in 2005–06 rotation and cash crops. involving 54 growers. Presentations included SRDC Project Code: CGB001

ANNUAL REPORT 2005–2006 29 quantity of sugar could be produced with four megalitres of water per hectare as with 10 megalitres of water per hectare. With the higher water applications, sugarcane tends to lodge, making cane harder to harvest and lowering its sugar content, as a result of rapid accumulation of biomass early in the growth and the soft soil resulting from the irrigation. However, the study showed that sugar continued to accumulate in the crops irrigated less, to give the same final sugar yield as in fully-irrigated crops. These results will allow growers to irrigate their Bundaberg Canegrowers use a beat sheet under the crops with minimum water wastage and instruction of QDPI&F’s Austin McLennan to identify maximum crop benefit. which bugs are in the soybean crop. SRDC Project Code: CSE001

Profitability though water use efficiency

Water use efficiency has improved in sugarcane. Research funded by SRDC and conducted by CSIRO Sustainable Ecosystems has provided guidelines for situations where water for irrigation is in short supply. This involves applying the available water at the times to maximise sugar yield. Many farmers have with-held water early in the season in the expectation of facing dry Research funded by SRDC and conducted by conditions in the second half of the growing CSIRO Sustainable Ecosystems has provided season. The new irrigation scheduling guidelines for situations where water for irrigation is program, WaterSense, uses climatic data in short supply. as well as predictions of rainfall to allocate remaining water. The program uses the New farming systems — the future of comprehensive APSIM-Sugarcane model the industry to predict sugar accumulation in response SRDC’s major investment in farming to application of irrigation water at different systems over the last 13 years has times. Growers in the Bundaberg area have been through the Sugar Yield Decline started to use the web-based program to Joint Venture (SYDJV). The joint venture improve their crop responses to irrigation. has designed and verified the benefits Studies in the Burdekin, where water is (economic and environmental) of an generally not limiting, showed that the same improved farming system based on

30 SUGAR RESEARCH AND DEVELOPMENT CORPORATION minimum tillage, controlled traffic, trash Australia, a risk assessment outline and many blanketing and legume rotation crops. fact sheets on best management practices for each major cane-growing region that cover The new farming system delivers productivity and environmental sustainability consistently high yields across the crop as well as farm health and safety. cycle through improved soil health, coupled with lower fertiliser, labour and machinery A survey undertaken as part of this project costs, and improved profitability overall. showed that cane farmers are generally aware of the Farm Management Systems Many farmers are implementing the initiative and recognise that it will improve package in stages, with 23 per cent of cane the environmental credentials of the sugar growers across Queensland now having industry, once implemented. Cane farmers well-managed legume fallows and five per generally indicated that they would prefer cent having adopted controlled traffic and to undertake an FMS voluntarily rather minimum tillage. About 12 per cent of New than having further regulation imposed by South Wales cane farmers have adopted governments at some future time. one or more components of the improved SRDC Project Code: FMS001 – 005 cane farming system. The SYDJV concluded in June 2006 and its good work will be continued in the 4A Improved Sugarcane Farming Systems project which commenced in July 2005. The new project will also play a role in coordinating several related initiatives including the QDPI&F and BSES-funded FutureCane project which seeks to promote adoption of the improved farming systems developed by the SYDJV. SRDC Project Code: YDV002 and BSS286 Help is just a mouse click away. Cane growers who Also helping cane farmers make the are embracing change now have access to a wealth transition to a farm management system of information about making the move to a new farm based on environmental management management system. systems, the industry now has valuable In the past, many cane growers have not reference information available at the click focussed sufficiently on the costs and of a button. Funded by the Natural Heritage benefits of alternative farming practices. Trust and conducted by Agrecon and CANEGROWERS, a suite of Sugar FMS A project led by the Queensland Tools is now available at the SRDC website Department of Primary Industries and www.srdc.gov.au. Fisheries (QDPI&F) is working with growers This website is a valuable tool, providing an in the Herbert and Burdekin districts in outline of legislation relevant to cane farmers in particular to help farmers analyse the Queensland, New South Wales and Western economics of improved practices and

ANNUAL REPORT 2005–2006 31 encourage them to adopt more profitable funded project, Ord growers have farming systems. measured an increase in per hectare gross margin of around $270 when using The farm economics assessment tool zero-tillage planting and a legume fallow. (FEAT), which was developed by QDPI&F economists, is a very useful way for farmers The area of legume break crops increased to compare the costs and benefits of from 54 hectares in 2004–05 to 390 existing and improved farming systems. hectares in 2005–06. Lablab was the legume found to be most suitable for Thanks to FEAT, growers are now more growing in the Ord cane farming system. knowledgeable about the anticipated Ord cane farmers traditionally burn the economic returns of new farming systems. crop before harvest, but recently they have The FEAT tool is giving growers confidence found that harvesting the green crop and and is contributing to faster adoption of retaining the crop residues did not adversely controlled traffic and legume rotations. affect ratooning. The trash blanket has also Popular features include the program’s provided good weed control. ability to identify the optimum number of SRDC Project Code: WAA003 ratoons to maximise profitability and to accurately calculate machinery operation costs.

A recent external review of the FutureCane program had high praise for FEAT and the support provided by QDPI&F and their partners to help cane farmers implement improved farming systems. SRDC Project Code: DPI015

Cane growers in the Ord River area of Western Australia are implementing the Cane growers in the Ord have measured an improved farming system developed by increase in per hectare gross margin of around $270 researchers in the Sugar Yield Decline when using zero-tillage planting and a legume fallow. Joint Venture program. In this SRDC Here lablab is being sown into cane trash. Case study Helping the industry PROSPER

With new understanding of ways to increase the profitability and sustainability of Australian sugarcane farms, much of the SRDC emphasis has been on encouraging growers to adopt improved practices. Those who embraced best practice in the Burdekin and took part in grower group training recorded higher returns per hectare – by about 7 per cent – compared with those who did not. The grower group training was a project called PROSPER, led by BSES Ltd and also involving CSR Sugar and Burdekin Productivity Services in the Burdekin. PROSPER was funded in part by SRDC. PROSPER aimed to encourage adoption of new technologies and information to enhance economic and environmental performance through providing a more reliable and sustainable cane supply.

32 SUGAR RESEARCH AND DEVELOPMENT CORPORATION BSES recognised that different regions faced different productivity issues and they consulted with industry to identify the issues and to get growers involved in the program. Aside from increased individual production, the program also generated printed material in local newsletters, booklets, trial reports, radio reports, press releases and in industry newspaper/magazine articles, provided training courses, undertook case studies and supported group development. SRDC Project Code: BSS260 D[jh[jkhd\eho[Whi'//.¸(&&) ')%%

'(%%

''%%

'&%%

'%%%

D[jh[jkhd &.%%

&-%% 6iiZcYh &,%% 6WhZci &+%% &..-&... '%%% '%%& '%%' '%%( 4A O[Wh Demonstrating a link between the adoption of new practices and financial returns. This graph shows a correlation between those who took part in grower group training and their improved net dollar returns.

Source: BSS260 Enhanced delivery of PROSPER to achieve adoption of Best Management Practice in the Queensland Sugar Industry Milestone 5 Report

Grains in cane – gains in profitability from southern to north Queensland. The and performance crop can be harvested for grain or used as a green-manure crop, and can be planted Well-managed soybean crops have been over a wide window including both the dry demonstrated to play an important role in and wet seasons. improving the performance of sugarcane production. In the past, only one variety, Stuart is broadly adapted to planting in both Leichhardt, was suitable for all cane- the wet and dry seasons in the tropics and growing areas. This reliance on one variety from south-east Queensland through to exposed the sugar industry to a high risk of north Queensland. reduced viability should the variety fail due to disease or other reasons. Stuart is particularly useful in these areas because of its nematode resistance. It also CSIRO Plant Industry has released a new has resistance to rusts, bacterial pustule, variety, Stuart, which was selected with bacterial blight, downy mildew and purple SRDC funding. This highly-productive variety seed stain. The new variety also has a light- is suitable for growing in sugarcane areas coloured hilum (a mark on the grain where it

ANNUAL REPORT 2005–2006 33 joins the plant), making its grain suitable for a grain/green-manure variety) and Bunya some human consumption markets. (special purpose high management variety), SRDC Project Code: CPI005 with the potential to produce excellent quality beans for tofu and milk. SRDC Project Code: CPI009

A field of Stuart, a new variety of soybean released thanks in part to funding from SRDC. This highly- productive variety is suitable for growing in Joe Linton and other members of the Advance sugarcane areas from southern to north Queensland Burdekin Collective have undertaken a Travel and Learning Opportunity Project to provide an opportunity to build farmer’s capacity by learning Additional work in identifying alternative from outcomes of on-farm trial work in relation soybean varieties is being undertaken. to overlap cropping. These trials are aimed Several candidate varieties with large at maximising the use of our land by planting vegetative bulk appear superior in grain sugarcane half way through the growth period of a bean fallow crop and then continue the yield, dry matter production and disease bean through to harvest while the sugarcane is resistance to the current green-manure established. The idea if successful will allow the variety, Leichhardt. If this superiority is farmers to ‘have their cake and eat it too’. Here maintained, it is likely that a variety will be cane is planted into mung beans. SRDC Project Code: ABC004 released to complement Stuart (which is

Case Study Beans mean business

Thanks to the ideas and evidence presented through the SYDJV and related projects, the practice of rotating cane crops with soybeans is now understood to have significant impacts on soil health and the productivity of future cane crops. In some areas, soybean and other rotation crops are grown as green manure crops with all the nitrogen and organic matter returned into the ground. The Isis Target 100 team has tasted success with the soybean industry which has increased from 500 tonnes of stockfeed quality beans in 2004 to a 2000-tonne harvest worth over $650,000 in 2006. Impressively 70 per cent of their latest harvest is food-grade quality. Soybean can fetch as much as $420 per tonne in this lucrative food- grade market. The team also has worked in partnership with Bean Growers Australia to develop a local navy bean industry to supply the SPC Baked Beans market. Recognising the benefits to sugarcane growers, SRDC will focus attention on identifying opportunities to partner with the Grains Research and Development Corporation to continue building on this opportunity.

34 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Enhancing the value chain

Key Outcome 2: Facilitation of change which promotes adoption of whole-of-system solutions to enhance revenue and cost efficiency across the value chain at mill area and regional areas.

Program A of the R&D Plan 2003–2008, identified future areas for co-investment in Value Chain Integration, provides a specific value chain improvement. focus for investment in R&D directed towards whole-of-system solutions. This In February 2006, the Parliamentary Program was given substantially increased Secretary for Agriculture, Fisheries and funding over the life of the Plan compared Forestry, Ms Sussan Ley launched the to the previous Plan period. Some of SRDC Technical Report The value chain of SRDC’s investments in Program C, the Australian sugar industry. This important Processing and Distribution Systems, are document provides an overview of the also directed towards this outcome. state-of-the-art of value chain improvements in the Australian sugar industry. In 2005–06, SRDC invested in several projects focused on opportunities to Key recommendations were made in this increase the value of the industry through publication to guide the development of integrated action across the value chain, future innovative value-chain R&D projects. 4A which has the potential to lead to greater This publication also provides data on the gains than could be achieved through action actual benefits delivered from investment in in individual profit centres alone. value chain R&D projects conducted in the Maryborough, Mackay and Herbert districts. Key achievements SRDC Project Code: SRD006 Stronger links across the sugar industry value chain

Value-chain R&D aims to integrate operations across the growing, harvesting, transport, milling, and marketing sectors. Over the past decade, SRDC has partnered with researchers and industry in many sugar regions to deliver improved efficiencies across the sugar industry value-chain.

In October 2005, SRDC hosted a Value Chain Forum attended by more than Parliamentary Secretary the Hon. Sussan Ley 80 representatives from all sectors and (centre) is joined by representatives from all sectors of the Australian sugar industry value chain to launch regions of the Australian sugar industry. This the SRDC Technical Report ‘The value chain of the forum delivered improved awareness of the Australian sugar industry’ in February 2006. scope and benefits of value chain R&D, and

ANNUAL REPORT 2005–2006 35 Delivering a comprehensive network of • A regional sugar industry model that linked models that capture interactions captures the interactions of the growing, between the harvest and transport sectors harvesting, transport, milling and of the sugar industry was the focus of marketing sectors; one CSIRO Sustainable Ecosystems-led • project which concluded in 2005–06. The Factual data and information regarding network of models was applied to several the biophysical and economic impacts case study regions including Mourilyan, on regional value chains of whole-of- Mossman, Plane Creek and Herbert to crop harvesting to maximise electricity deliver economic benefits. co-generation, as a result of technical analysis by the research team; This SRDC project has also greatly • contributed to improved collaborative Increased understanding by key industry research processes across R&D stakeholders of the regional sugar organisational boundaries, and this is industry value chain and the results of recognised as a significant benefit of this both the technical analysis and liaison investment. The interface between the between the research team and Local research sector and the industry sector has Reference Groups; and been improved, and flow-on benefits from • Economic benefits to the Maryborough this investment are anticipated in the future. district as a result of deciding not to Numerous groundbreaking scientific proceed with an uneconomic publications (Refer to Appendix C) were co-generation project. delivered from investment in this project SRDC Project Code: CSE010 and this project has contributed valuable Climate Connect 2006 intellectual capital for use in a large number of follow-on value-chain R&D projects. Over 120 delegates attended the National SRDC Project Code: CSE005 Forum of the Managing Climate Variability Program (MCVP) Climate Connect 2006 in Another CSIRO-led project completed in March 2006. This event was organised by 2005–06 developed a methodology to the RDC Joint Venture, of which SRDC is enable industry and researchers to gain a one of many partners. systems view of the sugar industry value chain and to explore the consequences Delegates included representatives of the of possible diversification ventures such program’s investors, some of Australia’s as co-generation. top climate scientists, meteorologists, researchers, government policy makers, The methodology was implemented in agronomists, extension officers, farmers the Burdekin and Maryborough regions to and natural resource managers. evaluate the expected economic gains from diversification in each case study region. Key As well as providing updates on the outputs and benefits of the project were: latest MCV research, attendees received

36 SUGAR RESEARCH AND DEVELOPMENT CORPORATION an overview of the benefits of the MCV controlled traffic have all shown positive program and the projects that it funds change. across a broad range of industries and SRDC Project code: MAS001 geographical regions. A key benefit was the opportunity to develop cross-sectoral In 2005–06, CSR Sugar led a project and cross-regional linkages. An output focused on working with industry toward of this event was a portfolio of fact sheets identifying where efficiencies can be summarising progress and outcomes achieved in the milling and growing sectors of each project funded by the MCVP. of the Burdekin sugar industry. Further information is available at A harvest benchmarking system is being www.managingclimate.gov.au developed in the Burdekin using GPS Applying value chain thinking in tracking technology. Key lessons from sugar regions this project include the value of working with end-users to develop relevant aims Since 2003, improvements in farming and strategies for the project. The project systems management practices have also reinforced the value of determining occurred in the Mossman district as a the attitudes of all those involved in the direct result of the SRDC project undertaken harvesting system towards the objectives 4A by Mossman Agricultural Services in and potential outcomes of the project – partnership with the local industry. this can provide valuable information on potential impediments to adoption. In particular, significant improvement in the SRDC Project Code: CSR033 nutrient management and farming systems area has been achieved. Business plans Work undertaken in 2005–06 as part of have been developed for over 35 per cent a project aimed at achieving world’s best of growers, and 70 per cent of Mossman practice harvesting and transport costs growers have undertaken some form of for the NSW sugar industry provided business planning. information about the optimal number and location of loading pads to ensure that A final plan for the harvest/transport system investment in new loading pads would has been developed in collaboration deliver net savings in harvesting costs of with various sectors of the Mossman over $750,000 over five years. industry. Changes implemented during the 2006 harvest season included extending Harvest management technology and harvesters’ cutting hours. An evaluation of productivity data were used in three New progress to date and report on likelihood of South Wales sugar mills during the 2005 achieving target adoption levels has been harvest season. completed and project key performance indicators demonstrate progress. For Siding Optimisation and Harvest Haul example, the indicators for nitrogen rates, Models, designed in an earlier SRDC- urea application on ratoons, fallowing and funded project to integrate and optimise the harvest and transport sectors of the

ANNUAL REPORT 2005–2006 37 value chain, were adapted and applied the committee on how the world shipping to the NSW industry. Two scenarios were system works and how the futures and considered, the current situation where cane options markets work. The information is burnt, and the alternative being whole of gathered on the TLOP helped to facilitate crop harvesting. change, develop a pricing strategy which uses new marketing tools previously not Potential cost savings from amalgamating tried, and a more thorough and responsible harvesting groups were predicted using the reporting system. harvest-haul model and were used to give SRDC Project Code: ORC001 the NSW industry confidence in making changes. SRDC Project Code: NSC006 The information gathered on this TLOP helped to facilitate change, develop a pricing strategy With the ultimate aim of enhancing ‘ revenue for Ord River cane growers, three and a more thorough and responsible reporting members of the Ord River Canegrowers system. pricing committee travelled to Queensland to meet with people who could educate ’

Case Study From farm to harvester, transport and mill – Mackay’s got it linked Central to an SRDC project completed in 2005–06 by the Mackay Cooperative Systems team was the development and implementation of a cooperative systems model to better link the farming, harvesting, transport and milling sectors of the Mackay sugar industry.

Through this project, sugar industry stakeholders had significant opportunities to build individual and collective capacity, and the merits of improved communication and coordination across the value chain are now widely recognised. At the industry leadership level and amongst project participants there is now a higher level of appreciation of the principles of value chain management, and acknowledgment of the potential benefits for the industry. This knowledge and awareness is demonstrated by the degree to which project outputs have been adopted by the regional industry and are being incorporated into business plans and strategies.

For example Mackay Sugar growers have adopted a new Cane Payment system developed during the project. The system has been promoted largely on value chain principles of sharing risks and rewards, and removing obstacles to cooperation between sectors to maximise returns for the whole industry.

Data loggers were installed on a further forty Mackay Sugar harvesters for the 2005 season, to measure area harvested, provide information operators and provide an in-field interface for other applications. Data loggers were also installed on Mackay Sugar locomotives and track vehicles, principally for tracking and collision avoidance, but to also measure and improve the scheduling and delivery of bins.

Further benefits to the Mackay value chain are anticipated as a result of implementation of the new payment system and implementation of the harvest monitoring system. Future activities are planned to further improve the efficiency and effectiveness of operations across the value chain in the Mackay district.

The Mackay Cooperative Systems team were recipients of the 2006 SRDC/Queensland Sugar Ltd Innovator of the Year Award in recognition of their innovative and beneficial R&D through this and related projects. SRDC Project Code: MSA003

38 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Environmental sustainability

Key Outcome 3: Demonstration of environmental sustainability to the satisfaction of all stakeholders

Delivering triple bottom line benefits to The wetlands allow water from acid sulfate the sugar industry and the Australian soils to slowly filter through vegetation enabling community through the sustainable use and sediment and metal complexes to settle. management of natural resources is a key focus of the SRDC R&D Plan 2003–08. Mr Quirk’s approach to farming the Tweed Valley’s acid sulfate-rich soils has Research into improved farming systems contributed to him reducing chemical use (such as the SYDJV and the development by 25 per cent, decrease heavy metal of FMS tools) outlined in Key Outcome 1 and acidity discharge by 80 per cent, and is having a significant impact on improved increase productivity by 38 per cent. environmental management practices. In addition to those projects which deliver This was achieved through liming, reduced environmental benefits described in Key tillage, drain filling, and retaining all crop Outcome 1, the following have been residues. Many of the practices Robert has highlights across SRDC’s investment developed are now considered world’s best portfolio in 2005–06. practice for farming those soils. 4A SRDC Project Code: UNW003 Key achievements Improving water quality

Discharge from farmlands of water with low pH and containing metal complexes has in the past impacted on the health of rivers in northern New South Wales. The implementation of cane farming practices that limit oxidation of the acid sulfate soils in this region and neutralise the acidity has helped to reduce this impact considerably.

As a further step to ensuring that the water draining from cane farms is free from contaminants, researchers from Robert Quirk (centre) with partner Margaret Hall the University of New South Wales and is presented with the 2006 McKell Medal for his Australian National University have worked environmental work in cane farming by Peter with a local grower, Robert Quirk, on an McGauran, Minister for for Agriculture, Fisheries and Forestry. The McKell Medal is awarded by SRDC funded project to install an artificial the Australian, State and Territory governments wetland on a site near McLeods Creek that for outstanding contributions to improving land flows into the Tweed River. and water management through on-farm action, scientific research and community involvement. Photo courtesy DAFF.

ANNUAL REPORT 2005–2006 39 Water quality is also an important issue Growers in the Mulgrave area of the in other cane producing areas. Rivers in Burdekin River irrigation area also played north Queensland such as the Herbert and an important role in measuring the quality Burdekin discharge into the Great Barrier of water leaving their irrigated cane Reef lagoon. The joint Commonwealth and farms. Previous studies had suggested Queensland Government Reef Water Quality that nutrients from fertilisers and perhaps Plan seeks to minimise the impact of land pesticides were present in tail-water management practices, including cane following furrow irrigation. A trailer with farming, on the marine environment. sampling and storage equipment allows the farmers to collect and analyse water coming The wetlands allow water from acid sulfate soils from cane blocks after irrigation or rainfall, to slowly filter through vegetation enabling sediment and to store samples properly so that they ‘ can be analysed for traces of nutrients and and metal complexes to settle. pesticides in specialist laboratories. The In 2005–06, SRDC ’invested in a number effects of changing fertiliser, irrigation or of projects aimed at monitoring the quality other farming practices on water quality of water draining off farms. As well as can be readily determined to improve the seeing a long-term improvement in water environmental performance of cane farming. quality, these projects will lead to an Growers now have new knowledge about improved relationship between industry and the environmental implications of their environmental groups and an improved practices. understanding of the relationships between SRDC Project Code: MAF001 on-farm practices and water quality.

In the first year of one such project, cane farmers in the Herbert led by CANEGROWERS staff, actively monitored the quality of water draining from their farms at several locations across the Herbert River district. Suspended sediment levels and nutrients such as nitrogen were measured and related back to on-farm practices. Farmers are evaluating the effects of changed farming practices on the quality of water leaving their farms. Initial data suggest This trailer with sampling and storage equipment allows cane farmers in the Mulgrave area to collect low levels of nitrate, but higher levels of and analyse water coming from cane blocks after phosphate which is bound to soil particles. irrigation or rainfall, and to store samples properly so Growers in the Herbert district are now that they can be analysed for traces of nutrients and pesticides in specialist laboratories. applying less fertiliser resulting in economic and environmental benefits. SRDC Project Code: CG013

40 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Adopting best practice nutrient Improved irrigation practices – profits management and environment the winners

A project led by BSES Ltd, CSR Sugar Sugar is a relatively new industry in the and QDNRM&W researchers is determining Ord River Irrigation Area (ORIA), following the specific fertiliser requirements for the availability of abundant water from sugarcane grown on different soil types the man-made Lake Argyle. However, across Queensland, and is aiming to reduce groundwater has been rising in the ORIA fertiliser costs by $60 per hectare or since widespread cropping commenced. 60 cents per tonne of cane. To remain sustainable, water use efficiency Soils differ in their ability to hold, mineralise in the ORIA needed to be improved and supply nitrogen as well as supply to reduce deep drainage. Research other nutrients for crop growth. Fertiliser funded by SRDC and led by CSIRO requirements therefore differ with the soil Sustainable Ecosystems researchers has type. The project aims to match fertiliser provided guidelines for matching irrigation application with crop requirements and soil applications with crop demand for water. type, so that excess fertiliser is not applied, Cane farmers in the Ord have reduced their which reduces the risk of loss of nutrients annual applications of irrigation water to 4A to the environment. sugarcane from 35 to 40 megalitres per hectare to an average of 21 megalitres per A tool to improve on-farm management hectare with no loss of sugar production. decision making – SCAMP (Soil Capability SRDC Project Code: CSE007 and Management Package) has been developed as part of this project. SCAMP Understanding links between cropping identifies soil constraints that are associated systems and the environment with particular soil types by analysing chemical, physical and morphological As part of the initiative to increase adoption (structure or form) information. This allows of the improved farming system arising for best practice nutrient management from the Sugar Yield Decline Joint Venture, strategies to be tailored, based on soil BSES Ltd is working with farmers in properties in particular environments. Central Queensland cane-growing areas to compare the new farming system with Fourteen workshops with growers have conventional cane farming in terms of their been held in the target regions and 39 strip effects of soil erosion during storm rains. trials were established, and the results used over the life of the project. This project has The project is now in its second year delivered recommendations on improved with two years still remaining. It has been fertiliser management to many growers working with growers to develop an across the Innisfail, Herbert, Burdekin, understanding of the new farming system Plane Creek and Bundaberg regions. and to establish on farm demonstration SRDC Project Code: BSS268 plots. This project has contributed to a surge of adoption of new farming systems

ANNUAL REPORT 2005–2006 41 Tim Triglone, from DAFWA measures cane crop evapotranspiration using Bowen ratio equipment in the Ord River Irrigation Area.

by growers in Central Queensland. Over Weirs and flumes have been set up at 1,000 hectares of cane is now grown the bottom end of cane blocks managed using the new farming system which will in different ways, with measurement of deliver future economic and environmental quantity and quality of runoff during and benefits. In addition, during 2005–06, 12 after rainfall. People from the Mackay- learning and communication activities Whitsunday NRM are collaborating with the including shed meetings, workshops, field researchers and farmers to collect more days and bus tours, attracted close to 1700 information on the impact of improved farm growers demonstrating there is extremely management practices on the environment. widespread awareness among central SRDC Project Code: BSS269 district growers of the new farming system.

42 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Diversifying the income stream

Key Outcome 4: Diversification of the income stream from products derived from sugarcane

The main avenues of diversification pursued Of these, six processes were examined in in SRDC’s portfolio in 2005–06 were detail for the whole-of-system impact of electricity generation by mills and alternative exploitation. These were: products under investigation through the • CRC for Sugar Industry Innovation through high efficiency cogeneration of electricity Biotechnology (CRC SIIB), an alliance of (requiring high-pressure boilers and Australia’s top sugarcane biotechnology energy-efficiency improvements in the expertise. sugar factory); • SRDC supports the CRC SIIB in its goal furfural as a commodity chemical; to add new value to Australian sugarcane • cattle feed from cane tops (which does through investment in a number of not involve bagasse from the milling projects. The collaboration and expertise process); embedded in this CRC is illustrated through the combination of research institutions • ethanol production using hydrolysis and including four Universities, sugar industry fermentation of bagasse; 4A research organisations, Federal and Queensland State Governments, and • diesel production from hydrothermal commercial expertise. liquification of bagasse; and

Key achievements • lignin and pulp production from bagasse (lignin and pulp can be used as a base From waste product to profit centre – for paints and paper, respectively). options for bagasse and trash

SRDC funded Sugar Research and The results of this analysis suggest that Innovation at Queensland University of the best returns on investment are from Technology (SRI@QUT) to undertake an production of biodiesel and in pulp and analysis of the costs, risks and benefits of lignin production from bagasse – with or turning bagasse and cane trash (leaf and without field-collected trash as an additional tops) into products that make more money feedstock. for the industry. SRDC Project Code: QUT008

As part of this project, close to 80 Dr Bryan Lavarack, a researcher with processes to produce saleable products Sugar Research Institute and Mackay from bagasse and harvest residues were Sugar Cooperative, visited mills and other considered. Forty-four technologies and researchers in South Africa to learn about their associated products were analysed recent R&D and value-adding projects in using a risk versus reward method to the sugar industry in that country. determine their commercial viability.

ANNUAL REPORT 2005–2006 43 Insights gained during the visit included the of opportunities for increasing the returns, use of bagasse to make activated carbon, particularly from by-products of sugar milling furfural, animal feeds and pulp and paper. and distilling. In addition, Dr Lavarack obtained SRDC Project Code: SRL001 information on the production of white sugar using a process that removes colour Maximising the benefits of mill mud and ash from syrup with ultrafiltration and Mill mud (a waste product of the milling ion-exchange columns. process) is a valuable soil amendment and a source of nutrients for crop growth. As a fertiliser, there are benefits which can be derived from returning mill mud to the field; however, it contains about 70 per cent water when it leaves the sugar mill, making the costs for transport quite high. Because of this, most of the mud is returned to fields close to sugar mills.

This project evaluated technology that produces a drier mud (and hence cheaper to transport) from the filter station in mills. Discussing options to turn bagasse and trash into A solid bowl centrifuge and a horizontal belt cash are (L to R) Dr Bryan Lavarack, Dr Graham press filter showed promise for reducing Bullock, Dr Bruce Lamb, Laurie Watson, Dr Phil Hobson, Tom Rainey and Ted Scott. the moisture content and sucrose lost in mud. Another advantage was that the mud from the solid bowl centrifuge was able to Dr Lavarack’s report was provided to be spread efficiently in cane fields by mud Australian sugar milling companies and has trucks. stimulated discussion on the range SRDC Project Code: SRI134

CRC for Sugar Industry Innovation through Biotechnology 2005–06 in review

This year has seen CRC SIIB work through the challenges that come with reaching the end of the first phase of a CRC. We made significant progress during our first three years in terms of advancing our research and mapping out viable commercial options for our work. Structurally, many of the initial three-year projects have concluded and significant effort has been committed to the development of final reports and publications.

To build on this first phase, considerable effort has gone into the development of a portfolio of projects for the next three years. All of the new projects include stop/go milestones, which means that the overall direction of each of our projects is now open to review. This approach reflects the commitment of our CRC to invest only in projects that make significant progress towards the CRC’s goals of creating opportunities which add significant commercial value to the Australian sugar industry.

Cooperation is the foundation on which a CRC is built. The level of synergy operating between various projects and institutions within our CRC increased during the year resulting in a level of cooperation that is bringing Cooperation is the foundation on which a CRC is built. The level of synergy operating between various projects

44 SUGAR RESEARCH AND DEVELOPMENT CORPORATION and institutions within our CRC increased during the year resulting in a level of cooperation that is bringing enormous benefits to sugar biotechnology research in Australia. In particular, the interaction between projects involved in the phenotyping and genotyping of plant material has led to considerable cross-project interaction utilising the planned crossing populations that have been created as part of the CRC. This, coupled with the interaction between groups working on marker technologies, has led to the CRC’s strong position in the development of markers for the Australian sugar industry’s plant breeding program.

As part of our strategy to ensure commercialisation, CRC SIIB has identified a significant commercial partner in the field of biopolymers. This partnership is currently being formalised. Collaborations bring enormous benefit to our research effort in terms of the added experience of our R&D partners and maintaining our commercial focus.

Global interest in the bio-based economy continues to develop, with many reports highlighting the challenges of relying on petroleum (particularly for transport fuels and polymers). Despite this interest, the role of bio-based materials in the future world economy has some hurdles to overcome. Apart from the massive increases in transport fuel production from fermentation technologies that utilise sugarcane and corn in Brazil and the USA, the commercialisation of bio-based materials internationally continues to emerge at a very slow pace compared to the level of interest in bio-based materials. A number of international companies are making significant financial commitments to the production of bio-based materials, but they are still considered high-risk ventures for many other potential investors. In terms of our research, gaining commercial support to further our bio-based work has been somewhat challenging. However, we believe Australia holds great potential in this area. During the year, the CRC SIIB’s second Research and Development Symposium brought together in excess of 4A 100 of the CRC’s researchers across all participant groups to hear the latest research and development outcomes. As in previous years, student presentations were of a very high calibre and reinforced the position of students in our research projects. The forum provided research staff who attended with an opportunity to gain a clearer understanding of the current position of the Australian sugar industry and issues that challenge its future prosperity.

One of the more significant research outcomes this year has been the development of genetic markers for resistance to sugarcane smut. For such a fungal disease not previously present on the east coast of Australia, genetic markers were regarded as being able to make a significant contribution to the selection of smut resistance in the Australian breeding program. With the occurrence of a sugarcane smut outbreak in the eastern Australian industry in mid-2006, there is now an even greater urgency to increase the frequency of smut-resistant varieties progressing through all regional breeding programs in the next few years. DNA markers could play a valuable role in assisting with this urgent and important industry goal. Analysis of options for implementing the most cost- effective methods for improving smut resistance in Australian breeding programs is being currently undertaken.

Into the next phase of our CRC, our challenge will be to take our work to new heights; to ensure we start to deliver the outcomes that are needed to add new value to Australian sugarcane.

ANNUAL REPORT 2005–2006 45 Enhancing human capacity and partnerships

Key Outcome 5: Enhancement of human capacity and partnerships between industry, research and regional communities to underpin change, learning and innovation.

Program D (Industry Capacity) of the SRDC Key achievements R&D Plan 2003–08 is specifically devoted Growing grower groups and to building the human capacity for change, strengthening networks learning and innovation in the sugar industry and significantly contributes to achieving The introduction of Harvester and Grower this Key Outcome. Group Innovation Projects (HGIP/GGIP) in 2005–06 has given grower groups Throughout 2005–06, SRDC has been the opportunity to build their own ability committed to fostering and developing to conduct research and development partnerships with industry and researchers. activities in their own district in partnership In 2005–06, SRDC worked with more than with researchers. 100 partners in delivering targeted R&D to the Australian sugar industry, including Growers and Harvesters have great ideas a greater number of grower-led groups and HGIPs and GGIPs are a way for these through the introduction of the Grower ideas to be tested. By pooling their ideas, Group and Harvester Group Innovation experience and enthusiasm, participants Projects. These groups have built their own have the ability to make significant changes ability to conduct research and development to their industry – in everything from making activities in their own district in partnership better financial decisions in grower owned with researchers. farming and harvesting businesses to developing a precision mill mud applicator Travel and Learning Opportunity Projects for a new farming system. (TLOP) are continuing to make a positive impression on the industry, with these In 2005–06, over 150 growers and projects delivering a return on investment harvesters were involved in 18 projects, well above the small financial cost of these allowing them to try something that they activities. had not tried or tested before. For example, project led by Joe Linton and Martin Walsh SRDC also contributed to several in the Burdekin has produced harvester initiatives in partnership with the Australian fronts with hydraulically-adjustable crop Government’s Department of Agriculture, dividers, allowing rapid adjustment when Fisheries and Forestry and other Rural R&D moving between blocks of cane grown on Corporations, as listed in Section 2. different row widths. Already, at least two other harvester operators have purchased this innovation. SRDC Project Code: HGP005

Pacific Cane Harvesting successfully undertook a project to design and build a moving wall on side tipping cane

46 SUGAR RESEARCH AND DEVELOPMENT CORPORATION transporters which has created a safe and efficient way to transport and unload When invited to provide feedback on the whole of cane from the harvester into road ‘relevance of HGIP and GGIP projects in their transport bins. region, 90 per cent of respondents from across SRDC Project Code: HGP002 the sugar industry ranked them from relevant to very relevant. SRDC hosted a GGIP’ Workshop in February 2006 that built the skills and knowledge of people involved in SRDC-funded GGIPs, and facilitated linkages between growers involved in innovation projects from across Queensland and northern NSW. Twenty-one growers participated and built their skills and knowledge in incorporating scientific rigor, economics and project evaluation into their projects. The Pacific Cane Harvesting Group are keen to share their results — demonstrating their work in 4A designing and building a moving wall on side tipping cane transporters to Sarina growers.

A Herbert harvester contractor, Anthony Girgenti, has devised a program to improve harvesting efficiency. This has now been purchased by several other harvesting groups. SRDC Project Code: HGP008

In addition to achieving solutions to be shared with industry, these projects are Harvester and Grower Group Innovation Projects enhancing the industry’s ability to work have given groups of growers and harvesters the in teams to learn and change. opportunity to build their own ability to conduct research and development activities in their own When invited to provide feedback on the district in partnership with researchers. relevance of HGIP and GGIP projects in The GGIP Workshop was held in their region, 90 per cent of respondents conjunction with an SRDC-funded Travel from SRDC’s Regional Workshop series & Learning Opportunity Project Grower across the sugar industry ranked them Initiated Virtual Expo (GIVE). The Advance from relevant to very relevant. Burdekin Collective partnered with SRDC SRDC Project Code: GGP001 – GGP010 and a range of others to attract over and HGP001 – HGP009 300 people to hear from growers about

ANNUAL REPORT 2005–2006 47 their progress to date in grower-led R&D and that grower-initiated R&D is building activities. Nine presentations were made by closer relationships between industry and SRDC-funded Grower or Harvester Group researchers to underpin change, learning Innovation Projects. and innovation. SRDC Project Code: SRD006 and ABC003 The GGIP workshop and GIVE day highlight that growers learn best from growers,

Case Study Incorporating a Grower Group – Plane Creek success

Established in 2001, the Plane Creek Sustainable Farmers (PCSF), a group of 20 like-minded growers, have been working on an SRDC funded project with BSES Limited to demonstrate the outcomes that can be achieved through ‘productivity’ focused incorporated grower groups.

As part of this project, PCSF, BSES and SRDC have investigated how ‘participative R&D’ combined with ‘action learning’ can deliver greater productivity, profitability and sustainability outcomes in shorter periods of time than current sugar industry extension tools.

The results of the group’s efforts speak for themselves. An analysis of productivity data for the 2005 harvest showed that group members on average produced 8.78 tonnes of cane, 0.21 units of CCS, 1.4 tonnes of sugar and returned $227 per hectare more than the average Plane Creek Mill area grower in 2005.

Rob Sluggett, grower, BSES Extension Officer and secretary for PCSF says that the members of the group have come a long way in understanding the issues involved in planning, organising, conducting, assessing and reporting on trials.

“The members of our group are all interested in controlled traffic and we came together to look at a range of practical issues that growers in the area were experiencing with the move to this new farming system,” Rob said.

“We’re always trying to build our capacity in directing and undertaking R&D activities that will deliver local productivity, profitability and sustainability outcomes,” he said.

Research priorities are clearly identified in the group’s R&D plan; included in the plan are a number of trials into sugarcane varieties, fallow management, herbicides, harvesting and planting.

Members of the group form smaller project teams to undertake research and trials into specific areas of interest, then feed the results back into the larger group and other industry members.

“We undertake a range of activities from observation and demonstration trials to fully replicated trials depending on the issue, need and stage of technology development.

“For example, one project team that has been looking at the use of herbicides for weed control has identified several additives that are useful in combating glyphosate resilient weeds,” Rob said.

Bryan Baker, grower and PCSF treasurer added that the group’s activities are conducted in partnership with sponsors and supporters to maximise the likelihood of success and benefit to a wider range of industry partners.

And he credits the group’s incorporation as a major incentive for sponsors to support the group.

48 SUGAR RESEARCH AND DEVELOPMENT CORPORATION “By becoming incorporated, we were telling industry that we were willing to stand up and be counted. We are serious about achieving results, and since we became incorporated a lot more funding has been available to the group,” he said.

To make it easier for other grower groups interested in becoming incorporated, PCSF, BSES and SRDC have produced an information sheet which explains the process and lists useful sources of information. SRDC Project Code: BSS287 and GGP008

Group members on average produced 8.78 tonnes of cane, 0.21 units of CCS, ‘ A Harvester Team meeting to investigate billet 1.4 tonnes of sugar and returned $227 per delivery from conveyor belts. hectare more than the average Plane Creek Mill area grower in 2005 ’ 4A TLOPs continue building industry at SRDC’s Regional Workshop series, capability 88 per cent of respondents from across the sugar industry ranked them from relevant to While Travel and Learning Opportunity very relevant. Projects (TLOP) represent a small proportion (less than three per cent) of TLOPs undertaken in 2005–06 not already the corporation’s total R&D investment reported in Sections 4A and B of this portfolio, they proved to be successful in Annual Report that have helped create encouraging the adoption of change and in change in the industry include: the enhancement of partnerships between industry, research and regional communities. • Herbert sugar industry leaders participated in a study tour of South In 2005–06, over 250 people representing African sugar industries. The group all areas of the Australian sugar industry examined the adoption of best value chain took advantage of the management practices, the introduction opportunity to attend conferences, study of new farming systems on large mill- tours, conduct workshops and seminars, owned farms, regional extension and invite speakers or facilitators for industry farmer education programs, a much functions, and many other activities longer season length and the widespread intended to develop sugar industry people. use of chemical ripeners, farm and financial record keeping systems and When invited to provide feedback on the industry R&D services. relevance of TLOP projects in their region

ANNUAL REPORT 2005–2006 49 Information and support tools were visited a mill outside the NSW Sugar obtained that will encourage industry Milling Co-operative. adoption of best management practices, Participants reported that they were able improvements to regional extension to find out about new ways of looking at programs and ways of optimising industry old problems, as each mill addressed the profitability across the value chain; same problem in a different way. SRDC Project Code: BSS281 SRDC Project Code: NSC011

• Participating in the Plant and Animal Genome XIV Conference allowed CSIRO Plant Industry’s Dr Rosanne Casu to present on CRCSIIB’s transcriptional profiling experiments of the stem, identify new genomic and bioinformatics approaches for use in sugarcane, and identify potential collaborators on functional genomics, bioinformatics and genetic analysis in sugarcane and related grasses. Herbert sugar industry leaders accessed Information and support tools that will encourage This is the major conference for industry adoption of best management practices, improvements to regional extension programs and dissemination of genomics, bioinformatics ways of optimising industry profitability across the and molecular marker-related research value chain during a visit to South Africa as part of for major crops, including sugarcane. a TLOP undertaken in 2005–06. Lawrence Di Bella It provided Dr Casu with valuable is pictured with a 40th year ratoon crop. information in order to further the process • Twenty industry people from Tully, of producing elite germplasm as well Innisfail-Babinda and Mulgrave regions as in the ultimate delivery of improved participated in a Farming Systems tour sugarcane cultivars to industry. of southern Queensland and northern SRDC Project Code: CPI011 New South Wales to build their capacity to change by viewing new and alternative When invited to provide feedback on the farming systems; relevance of TLOP projects in their region, 88 per SRDC Project Code: DPI018 ‘ cent of respondents from across the sugar industry • Engineers from New South Wales ranked them from relevant to very relevant. sugar mills were able to meet with their ’ counterparts in Queensland mills to share Making an impact on sugar people ideas about operation and maintenance systems and practice. Due to their In May 2006, 30 younger-people from the distance from other sugar mills, only one Far North, Herbert and Burdekin regions of the eight participating engineers had graduated from the Impact on Sugar

50 SUGAR RESEARCH AND DEVELOPMENT CORPORATION program, a project funded by SRDC and contribution to the Australian sugar industry led by Dr Cheryl Phillips, Leading Industries. at an individual, enterprise and regional Graduates are now equipped with the level. skills, knowledge and confidence to make a significant contribution to the Australian sugar industry at an individual, enterprise and regional level.

The Impact on Sugar program comprised two residential sessions three months apart with participants completing an industry-related project during that time. The program also created effective linkages between existing bodies through mentoring and participation at industry meetings.

Ingham-based project participant Javier Balanzategui’s, project, investigated the roles and situations of young people in the Another SRDC funded project that has 4A sugar industry, and tried to understand why helped build the capacity of sugar industry young people leave or return to the industry. people to take a more active role is the Leadership Training for Women in Sugar. “The future of the sugar industry is obviously something that is important to many people Sixteen participants from the Far and it was great to be involved in a project North, Herbert, Burdekin, Central, and that brought together many young people Maryborough districts participated in a who will one day play a leadership role in week-long leadership training program in this industry,” he said. Brisbane in May 2006. This project was led by Cathy McGowan and seeks to partner “I’m keen to work out how we can with CANEGROWERS organisation to encourage more people to get involved in stimulate leadership strategies for women in the industry and find out about new ways the Australian sugar industry. of doing things.” As a result of the workshop, each The enthusiasm, commitment and passion participant established a goal and a of the Impact on Sugar graduates was pathway to achieving their goal. Individual noted by all industry leaders present at goals included gaining a Board position the graduation. and improving links across regions between SRDC Project Code: LDI001 sugar industry women. SRDC Project Code: CMG001 Graduates of the Impact on Sugar Program are now equipped with the skills, knowledge and confidence to make a significant

ANNUAL REPORT 2005–2006 51 Empowering the next generation Industry leaders committed support for Generation Next delegates to achieve their SRDC hosted the first Generation Next goals. Evaluation results clearly demonstrate Forum in February 2006 bringing together individual and social capacity outcomes over 50 younger participants from all were achieved from this event. In particular, sectors of the Australian sugar industry delegates learned there were positive young to learn and apply skills in change people throughout all sectors of the industry management and innovation. and new links were formed where previously there were none. Forum delegates also SRDC partnered with Dr Cheryl Phillips, learned there is plenty of support available Leading Industries, and a 15-member in people that are willing to help. The Forum Steering Committee to deliver a Generation Next 2006 Forum was the first highly innovative and successful forum. step of a program that will deliver self- Industry leaders including SRDC Directors, sustaining long-term social capacity building representatives from DAFF, BSES Limited, outcomes over the next three years. QDPI&F, CSR, CSIRO, JCU, ACGC, ACFA, SRDC Project Code: SRD006 ASMC, attended the final session of the forum, and contributed to developing a plan for action.

These Generation Next participants are learning how to apply skills in change management and innovation.

52 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Taking the grass roots road to change 2005 SRDC/DAFF Science and Innovation Awards for Young People Judy Skilton, BSES, is leading a major in Agriculture capacity building program in the Isis district that has built improved business and The Science and Innovation Awards management skills among 40 cane farming for Young People are designed to businesses over 2005–06. The project encourage young Australians to undertake has applied components from the QDPI&F groundbreaking research that will help boost Building Rural Leaders program which the competitiveness of Australia’s rural delivers specialised, interactive, grower-friendly industries. workshops on change and action learning. This project is clearly aligned with the Isis Andrew Lashmar won the 2005 SRDC/ Target 100 strategic plan for the region. DAFF Science and Innovation award for Young People and has spent the year According to Isis Target 100 supervisor, Paul researching efficient irrigation management Nicol, over 40 growers in the Isis supply practices in complementary crops. area have been actively involved in the Targeted Planning for Profit program and Compared to sugarcane, these crops are the results are already being seen. more sensitive to irrigation management, 4A both from being too wet (water logged) “The way most growers took the news of and too dry. As a result, profitability can be the smut outbreak in their stride has been severely impacted through inappropriate wonderful, growers are philosophical and management. are already thinking about how to adjust to make sure it has minimal impact on their business” Paul said. SRDC Project Code: CG008

ANNUAL REPORT 2005–2006 53 Effective R&D capability

Key Outcome 6: An effective R&D capability underpinning industry futures.

SRDC seeks to promote more effective recommended further SRDC Scholarship coordination of R&D activities across Forums should be held that ensure industry and R&D partners, to enhance the maximum benefits are delivered from performance of the R&D system through SRDC’s investment in scholarship projects. evaluation, review and feedback, and to encourage a broad range of R&D providers. The Forum was chaired by Dr Mac Hogarth, SRDC Director and Chair of the SRDC Through Key Outcome Six, SRDC is Scholarship Committee. facilitating enhanced skills in R&D personnel. SRDC Project Code: SRD003 SRDC requires all R&D project proponents to outline how they will implement change and deliver project outcomes. SRDC conducted workshops in December 2005 to assist investigators with new projects to integrate adoption and evaluation into project design. This process delivered improved capacity among investigators through developing an ethos of, and skills in, evaluation.

Key achievements SRDC Scholarships Program

The purpose of the SRDC Scholarships SRDC scholarship recipients joined with SRDC Program is closely linked to Key Outcome Directors and staff at a forum held in February 2006. 6 and is helping to build an effective R&D The aim of the forum was to improve their capacity to promote the outputs of their research. capability underpinning industry futures

SRDC conducted its first Scholarships Topics of scholarship projects undertaken Forum in February 2006 and brought in 2005–06 cover the spectrum of SRDC together eight current scholarship recipients program areas and disciplines of inquiry to increase awareness of the people include biotechnology, value-chain and projects that comprise the SRDC integration, social science, farming systems Scholarships Program. The forum also and milling and processing systems. helped improve the capacity of SRDC The following students were enrolled in PhD Scholarship students to promote the and Masters programs in 2005–06: outputs of their research. • Elizabeth Meier investigated the Forum evaluation results demonstrated availability of nitrogen in green cane trash all attendees valued the forum, and

54 SUGAR RESEARCH AND DEVELOPMENT CORPORATION blanket soils in the wet tropics and its • Su Yin (Suzie) Tan studied bagasse impact on productivity and profitability; fractionation using ionic liquids;

• Cheong Ngo investigated molecular • Matthew James investigated integrating analysis of suckering and tillering in the harvest, transport and milling value sugarcane; chain by implementing a novel data infrastructure and decision support; • Kimberly Ritter undertook an investigation of the genetic, biochemical and molecular • Karen Benn commenced studies into the basis of sugar accumulation motivators and barriers to the adoption of in sugarcane; more sustainable farming practices;

• Peter Wulf investigated the self-regulatory • Kenji Osabe investigated the development codes of practice and their effectiveness and application of a mature stem specific in achieving best environmental promoter in sugarcane; management practices within North • Queensland primary industries; Tom Rainey investigated improved bagasse fibre properties for the • Mira Durr investigated the microbiology manufacture of paper, board and of acid sulfate soils in agricultural composite materials; 4A environments; • Jane Churchill commenced studies into • Brendan Dyer investigated an integrated rapid screening tools for smut resistance pest management strategy for climbing of sugarcane varieties; rat in the Far North sugarcane production • system; Anna Satje investigated improving the cation retention capacity of cane-growing • Kylie Anderson investigated the invasion soils using high activity clays. potential of Eumetopina flavipes, vector of Ramu Stunt Disease of sugarcane;

CASE STUDY Karen Benn

Acknowledging the importance of building R&D capacity in technical sciences as well as social sciences, SRDC is proactively encouraging the development of R&D expertise in social sciences through investments like the PhD scholarship project being undertaken by Karen Benn.

Karen was awarded an SRDC PhD scholarship to study at the School of Social Science at James Cook University to better understand motivators and barriers to the adoption of improved farming practices. After her first year of study, Karen said the scholarship has allowed her to combine her background in agricultural sciences with a passion for understanding the people who make up industry.

“The question I’m really working towards answering is why farmers don’t use certain recommended practices,” Karen said.

ANNUAL REPORT 2005–2006 55 “Hopefully answering this question will help industry and government learn about why people do what they do and how both groups can work together to create policy and practices that are going to reflect the needs of both groups,” she said.

Karen credited the support of industry in helping her progress her studies.

“SRDC have been great in helping me build strong links with members of local industry — the more people I meet, the more I learn,” Karen said.

“Likewise my co-supervisors from CSIRO, Peter Thorburn and Emma Jakku have helped me tap into a wealth of industry experience.

“I can see a definite trend for organisations to place more value in the role social science can play in improving the interactions with industry, especially in the agricultural field. Karen Benn, SRDC PhD Scholarship student (right) “Organisations are learning that they need to work with discusses motivators and barriers to the adoption of people to make change, and it is really exciting to be a improved farming practices with CSIRO’s Dr Emma part of that shift in focus,” Karen said. Jakku and Dr Peter Thorburn.

Grower groups recognised with • Central Region (joint winners) – Plane regional awards Creek Sustainable Farmers Inc, a group of over 20 members all committed Cane farmers are innovative by nature and to developing a superior sugarcane have to be resourceful to overcome the farming system and happy to share challenges they face in farming. SRDC knowledge, experience and motivation. recognised grower groups who had clear CANEGROWERS Women’s Network goals for improving their wellbeing; the Mackay District which was initiated benefits they produce for the sugar industry; by cane-growing women as a forum their ability to share their results with others in which a range of issues impacting outside their group and their ability to tap the sugar industry and dependent rural into professional skills to help them trial new community could be addressed; ideas or improve their results. • Proserpine Region — O’Connell Winning groups were: Catchment Precision Services who are inspired by the need to dramatically • Tully Region — Tropical City Group, change the way in which the production a state-wide group of 25 farmers with of sugarcane is managed; the goal of bringing together equipment manufacturers and innovative farmers • Burdekin Region — Advanced Burdekin who are adopting or moving into Collective formed to advance on-ground controlled traffic farming systems; adoption and research of new farming

56 SUGAR RESEARCH AND DEVELOPMENT CORPORATION systems and promote a positive outlook for other farmers and the community;

• Bundaberg Region — Women in Sugar Bundaberg and District, a group of some 20 women working to unite, support and represent women in the Bundaberg District sugar industry and provide technical information to improve on-farm decision making;

• Southern Region (Maryborough) — Nikenbah Harvesting/Petersen Farms whose members are supporters of the conversion to control traffic farming on a Andrew Barfield, SRDC Director (left), congratulates members of the Tropical City Group for the efforts of two-metre bed system; their group in the adoption of controlled traffic and other new farming systems. • NSW Region — Pacific Cane Harvesting whose vision was to harvest members’ 4A cane economically and to make cane growing more sustainable by decreasing input costs whilst improving efficiency, maintaining soil health, and minimising compaction. All group members have adopted a controlled traffic, dual row system with a soybean fallow and use GPS guidance for marking rows and harvesting.

Grower Group winners in the Proserpine region, O’Connell Catchment Precision Services are congratulated by SRDC Director Mary Corbett.

Representatives of the Women in Sugar Bundaberg and District were recognised for their support of women in the sugar industry in the Bundaberg district.

ANNUAL REPORT 2005–2006 57 Recognising sugar industry innovators

Highly respected and deserving sugar industry innovators were recognised for their contribution to Australia’s sugar industry at the 10th annual Sugar Industry Innovator R&D Awards, presented by Parliamentary Secretary Sussan Ley in Mackay, May 2006.

The Mackay Cooperative Systems Team took out top honours, named the 2006 Sugar Industry Innovators of the Year. The team developed and applied innovative computer-based systems to improve the performance and profitability of the Mackay sugar industry.

As recently as six years ago, the Mackay sugar industry managed the supply chain using paper maps, paper reports, manual estimating and data collection. Today a web portal provides information, tools and communication services, maps can be accessed using GIS, Geoff Inman-Bamber was named winner of the 2006 and tracking units fitted to harvesters transfer Sugar Industry Research and Extension Award for ‘real time’ data to the portal. Importantly his work in improving irrigation management over the last decade. an impressive 80 percent of growers and harvesters use the portal regularly.

Other winners included CSIRO’s Dr Geoff Inman-Bamber, who was named winner of the Sugar Industry Research and Extension Award for his work in improving irrigation management over the last decade. Dr Inman-Bamber’s work not only made significant advances in productivity and profitability, but it also had significant positive environmental implications.

Joint winners of the Sugar Industry R&D Services Award, Ron Kerkwyk and Eoin Wallis, were recognised for services Joint winners of the Sugar Industry R&D Services Award, Ron Kerkwyk (left) and Eoin Wallis (right), delivered at a regional and industry-wide were recognised for services delivered at a regional level respectively. and industry-wide level respectively.

58 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Mr Kerkwyk is greatly respected as an experienced sugarcane technologist and is well known for his effective management of the Herbert Cane Productivity Services Limited.

Mr Wallis, Chief Executive of BSES, was recognised for his significant contributions to R&D management and policy development throughout his career.

The awards are held each year to recognise and reward the contributions made by 2006 Sugar Industry Innovators of the Year, the Mackay innovators in Australia’s sugar industry. Cooperative Systems Team celebrate their win.

4A

ANNUAL REPORT 2005–2006 59 Section 4B Achieving Corporate Performance Measures

SRDC Result Key Achievements Performance Indicators and (for further information about all projects listed please see Measures the SRDC Annual Report Supplement CDROM)

Indicator: Economic returns from SRDC investments

Investment analyses of ✓ SRDC commissioned Brisbane based company Agtrans Research to completed R&D projects undertake an analysis of six recently completed projects, which were sourced demonstrate a benefit: from across the four SRDC Programs. cost ratio greater than 5:1 The aggregate benefit cost ratio was well above the targeted figure, at 8.4:1, assuming a five per cent discount rate and a sugar price of $285 per tonne.

The six projects included in the analysis were SRI097, MSA003, BSS261, CSE001, CTA028, YDV001/002.

Adoption rates ✓ 1 New Farming Systems — SRDC Project Codes BSS286 and WAA003 benchmarked for at • A total of 391 hectares of fallow legume were planted by growers for least three technologies the 2005/06 wet season. This compares with only 54 hectares per year in 2003–04 • DAFWA prepared an economic analysis of the comparative costs of conventional and new farming systems applied in the Ord River Irrigation Area which indicates that there are cost savings in zero till planting after a legume crop of $271 per hectare.

2 Encouraging change in the Queensland sugar industry — SRDC Project Code: BSS260 • Those who embraced best practice in the Burdekin and took part in grower group learning recorded higher returns per hectare — by about seven per cent — compared with those who did not.

3 Harvesting Technologies — SRDC Project Code: HGP008 • This project has involved farmers in discussions about their farm layout for harvesting, with farmers taking responsibility for the cost of harvesting. It has made the harvester operators realise that they need to look for ways to contain their costs for the future.

60 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Indicator: Environmental returns from a better understanding of environmental management issues, and a reduction of adverse impacts on the industry’s production environment and other ecosystems.

Case studies ✓ 1 NSW Wetland Project — SRDC Project Code: UNW003 demonstrate improved • Robert Quirk, who farms in the Tweed River catchment, won the 2006 natural resource McKell Medal in recognition of his efforts to develop cane farming management and practices that prevent acid discharge to waterways. reduced environmental impacts in quantitative 2 A new cropping system for central district — SRDC Project Code: BSS269 • and/or qualitative terms. An improved cane farming system, which involves reduced tillage and growing of legume cover crops when the land is fallowed from cane, is being implemented across all cane farming areas in Australia. The new farming system should reduce soil erosion.

3 Implementation for Ord irrigation — SRDC Project Code: CSE007 • Ord River cane farmers have reduced their average water use from about 35–40 megalitres per hectare to 21 megalitres per hectare per year since 1996. This has occurred without sacrificing cane yield by following the guidelines developed by CSIRO Sustainable Ecosystems researchers in SRDC-funded projects. 4B

4 Accelerated adoption of best-practice nutrient management — SRDC Project Code: BSS268 • A team of researchers lead by Dr Bernard Schroeder of BSES Ltd is helping farmers reduce their fertiliser rates without reducing cane yields by identifying the capacity of different soils to hold, mineralise and supply essential nutrients such as nitrogen for crop growth.

5 Water quality monitoring — SRDC Project Code: MAF001 • The Mulgrave Area Farm Integrated Action (or MAFIA) group purchased, and were trained in the use of monitoring equipment to assess the quality of water coming from their cane fields. The farmers have implemented improved practices, such as sub-surface placement of fertiliser, to reduce the risk of losing nitrogen into tail-water during irrigation immediately after fertiliser application.

6 Herbert water quality management — SRDC Project Code: CG013 • Herbert River cane farmers and CANEGROWERS support people obtained SRDC funding to initiate a water-quality monitoring program. The effects of different farm management practices were evaluated.

ANNUAL REPORT 2005–2006 61 Indicator: Societal returns from investment in industry and public health and safety; human resource capacity and capability; and R&D with significant community benefits.

Case studies ✓ 1 Factory trial of modified long life roll shell. Surface — SRDC Project demonstrating improved Code: SRI137 health and safety. • Research undertaken in 2005–06 is hoping to develop a new roll shell made from material that is more resistant to wear and which will help to reduce the risks to welders from working on moving machinery and from toxic fumes.

Completion of at least ✓ 1 Kerry Nutt completed her PhD thesis and Matthew James completed his two tertiary scholarships Master thesis in 2005-06. and two study tours or conference attendances 2 The continuation of the successful Travel and Learning Opportunities by industry R&D personnel Program provided opportunities for 41 people to attend conferences or per year. participate in study tours which focused on building capacity for learning, change or innovation in sugar industry people.

The number of producers ✓ The commencement of Grower Group Innovation Projects and continued involved in participative investment in Travel and Learning Opportunity Projects in 2005–06 had a major action research influence on building industry and human capacity for change; learning and increasing each year innovation among over 400 individuals in the sugar industry, who were involved in these participative action research projects, a significant increase in participation.

The proportion of total ✓ In 2005–06, more than 50 per cent of all projects, representing approximately SRDC funding that 40 per cent of project funding, undertook R&D that if successful will result in contributes benefits outcomes beyond the sugar industry. beyond the sugar industry exceeds 30%

The proportion of total ✓ In 2005-06, SRDC conducted R&D that if successful will result in outcomes SRDC funding that to rural and regional communities through regional planning and development, contributes significant business development, human capacity building and skill development, benefits to rural and health and safety and amenity. In addition to these projects, many others are regional communities expected to provide direct economic benefits that flow on to rural regional exceeds 20% communities through improved cash flow and profitability in the sugar industry.

Indicator: Alignment of SRDC’s priorities and plans with those of the Australian sugar industry and the Australian Government

Outputs produced in ✓ Outputs addressing all target outcomes of the SRDC R&D Plan 2003-08, and all sugar industry and all Australian Government National and Rural R&D priorities are described in government priority areas detail in Section 4A of this Annual Report.

Indicator: Compliance with statutory obligations

Submission of statutory ✓ During 2005–06, SRDC submitted all statutory reports to the Parliamentary documents on time and Secretary within required deadlines. In October 2005, the Parliamentary meeting all requirements, as Secretary approved the SRDC Annual Report for 2004–05 for tabling in the measured by acceptance Australian Parliament. In June 2006, the SRDC Annual Operational Plan by the Minister 2006-07 was approved.

62 SUGAR RESEARCH AND DEVELOPMENT CORPORATION SECTION 5 Report of Corporate Operations

Legislative Framework

SRDC was established under the Primary Industries and Energy Research and Development Act 1989 (the PIERD Act) on 1 October 1990. As an Australian Government Statutory Authority, it is also subject to the Commonwealth Authorities and Companies Act 1997 (the CAC Act).

The objects of the PIERD Act are to make provision for the funding and administration of research and development relating to primary industries with a view to:

(a) increasing the economic, environmental or social benefits to members of primary industries and to the community in general by improving the production, processing, storage, transport or marketing of the products of primary industries;

(b) achieving the sustainable use and sustainable management of natural resources; 5

(c) making more effective use of the resources and skills available in the community in general, and in the scientific community in particular; and

(d) improving accountability for expenditure upon research and development activities in relation to primary industries.

The PIERD Act establishes the following functions of SRDC:

• to investigate and evaluate the requirements of the sugar industry for R&D, and on the basis of that investigation and evaluation, to prepare an R&D plan, and to review and revise the plan;

• to prepare an Annual Operational Plan for each financial year; • to coordinate or fund the carrying out of • 14 April 2003, Finance Circular R&D activities that are consistent with the No. 2002/02 – Cost Recovery by Annual Operational Plan prepared by the Government Agencies; Corporation and in force at the time; • 13 October 2003, National Code of • to monitor, evaluate and report to Practice for the Construction Industry the Parliament, the Minister and its and the Commonwealth’s Implementation representative organisations on R&D Guidelines; activities that are coordinated or funded, • wholly or partly, by the Corporation; 19 May 2005, Finance Circular 2005/04 – Application of general policies of the • to facilitate the dissemination, adoption Australian Government to bodies under and commercialisation of the results of the Commonwealth Authorities and research and development for the sugar Companies Act 1997; industry; and • 19 May 2005, Finance Circular 2005/05 • such other functions as are conferred – Investment of surplus money; and on the Corporation by this Act or any • other Act. 8 November 2005 about the Australian Government Property Ownership Copies of the SRDC R&D Plan, Annual Framework. Operational Plan and Annual Report are available from the SRDC website, www. SRDC is complying with the notified policies. srdc.gov.au or by contacting SRDC. Objectives of SRDC General policies of the Government The objectives of SRDC are directly related Under section 28 of the CAC Act, the to the objects of the PIERD Act. They are: Minister may notify the SRDC Board of any • To improve the competitive position and general Australian Government policies that cost efficiency of the Australian sugar apply to the SRDC. industry; As at 30 July 2006, the following • To achieve sustainable use and notifications had been received: sustainable management of the natural • 21 August 2002, Commonwealth Fraud resource base of the sugar industry; Control Guidelines 2002; • To apply industry, scientific and • 28 August 2002, Finance Circular No. community resources more effectively to 2002/01 – Foreign Exchange (FOREX) R&D in the sugar industry, and Risk Management; • To manage SRDC resources efficiently and to improve the accountability for expenditure on R&D for the sugar industry.

64 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Funding of SRDC Fisheries and Forestry. Senator the Hon. Richard Colbeck was the Parliamentary Funding of SRDC is by levies from industry, Secretary until 27 January 2006, with with matching Australian Government the Hon. Sussan Ley MP subsequently contributions up to 0.5% of the gross value appointed to the position. The Parliamentary of production (GVP). Levies are imposed Secretary: under Schedule 24 of the Primary Industries (Excise) Levies Act 1999 and collected • Approves the five-year R&D Plan and the under the Primary Industries Levies and Annual Operational Plan; Charges Collection Act 1991. In 2005–06, the levy was $0.14 per tonne of sugarcane • Appoints Directors, other than crushed, divided equally between growers the Chair, Executive Director and and millers. Government Director, of SRDC on the recommendation of the Sugar Research Industry Representative Organisations and Development Corporation Selection The PIERD Act prescribes the following Committee, and representative organisations of SRDC: • Appoints the Chairperson and • Australian Cane Growers’ Council Government Director of SRDC. Limited; SRDC’s practice is to communicate with • Australian Cane Farmers’ Association the Minister in writing after every in-person Limited; Board meeting. More specifically, in July each year the Board reviews the continuing • Australian Sugar Milling Council relevance of the SRDC R&D Plan, and 5 Proprietary Limited. advises the Minister of the outcome of that review. The Chair and Executive Director SRDC is accountable to both the Australian also endeavour to arrange meetings with Government and these representative the Minister at approximately six-monthly organisations. SRDC meets formally with intervals, at times convenient to the Minister. the representative organisations three times each year to discuss SRDC activities, In 2005–06, no significant events occurred statutory reporting, levy arrangements as that required notification to the Minister requested, R&D priorities and any other under section 15 of the CAC Act. matters of mutual interest. More details are provided under the Consultations heading Corporate Governance below. Framework

Responsible Minister The SRDC Board sets the Corporation’s SRDC is responsible to the Federal strategic direction and delegates Parliament through the Parliamentary responsibility for day to day management Secretary to the Minister for Agriculture, to the Executive Director. The Board is committed to governance systems

ANNUAL REPORT 2005–2006 65 that enhance performance and ensure • At the July 2005 meeting, the Board that SRDC is operating according to endorsed the assessment process for accountability provisions of the PIERD Act Board and Audit Committee Performance and the CAC Act. including questionnaire and formal meeting with the Chair. All Directors SRDC’s Corporate Governance Framework, were positive about the Board’s overall which is documented in Table 5.1 on the performance and agreed that the following pages, was adopted by the strategic focus of the Board had been Board in its present form in March 2004. raised. At the March 2006 meeting, As part of the framework, the Board the Board reviewed SRDC’s Corporate completes a Due Diligence Checklist at the Governance Framework, SRDC’s Code of conclusion of each Board meeting. At every Conduct, SRDC’s Due Diligence Checklist meeting in 2005–06, the Board confirmed and SRDC’s Board Assessment and Audit that all decisions had complied with the Committee Framework, and endorsed requirements of the Due Diligence Checklist. their continuing appropriateness.

Table 5.1 SRDC Corporate Governance Framework Leadership

SRDC operates under the direction of a Board which is responsible for developing the Corporation’s policies, governing its operation and monitoring its performance. The Executive Director leads the SRDC management team and is accountable to the Board for day to day operation of the Corporation. The Board has two committees – an Audit Committee to provide advice on accounting, financial reporting, compliance practices and risk management, and a Scholarship Committee which provides advice to the Board on policies relating to scholarships and the awarding of scholarships.

The key Board functions are:

• establishing goals and setting strategic direction. • developing and approving a five year R&D Plan, an Annual Operational Plan and producing an Annual Report. • establishing policies and approving procedures for the operation of SRDC. • ensuring that risk assessment and management frameworks are in place to minimise business and financial risk. • ensuring that R&D resources are allocated to address priority issues effectively. • ensuring compliance with applicable laws and provisions of the CAC Act. • ensuring that Directors and staff maintain the highest ethical standards in accordance with the Code of Conduct. • appointing, appraising, and setting the level of remuneration for the Executive Director. • evaluating its own performance and that of its committees and SRDC management against agreed indicators

66 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Planning and Reporting

The five year R&D Plan defines SRDC’s core business, indicates broad priorities for R&D and defines the corporate strategy to achieve its outputs and outcome.

The Annual Operational Plan (AOP) specifies the broad groupings of R&D activities that SRDC proposes to fund during the financial year together with an estimate of income and expenditure. The AOP must be submitted to the responsible Minister for approval and a copy forwarded to each of SRDC’s Representative Bodies.

The SRDC Portfolio Budget Statement summarises SRDC’s outcome, outputs, performance information and financial position each year. It is consistent with the five year R&D Plan and the AOP and is tabled in Parliament.

The SRDC Annual Report gives particulars of R&D activities funded during the year (inputs), and a review of how SRDC has performed in relation to the objects of the PIERD Act, the SRDC R&D Plan and its corporate outputs and outcome. The Annual Report must be submitted to the responsible Minister for tabling in Parliament and provided to each of SRDC’s Representative Bodies.

Accountability

As required by Sections 15 and 16 of the CAC Act, the Chair of SRDC advises the responsible Minister in writing of significant events affecting the operation of the Corporation, and the general operations of the Corporation. It is SRDC policy for the Chair and Executive Director to also consult personally with the Minister twice yearly, and to write to the Minister after each Board meeting outlining key decisions taken.

The Chair and Executive Director meet three times each year, in March, July and November, with the Executive of SRDC’s three Representative Bodies to discuss SRDC’s Annual Operational Plan and Annual Report and investment needs and priorities. 5 Management

The SRDC Business Process Management System (BPMS) folds active quality assurance into the daily management of SRDC. It is an essential tool in managing risk and controlling fraud and its annual audit is overseen by the Audit Committee.

Financial Control

SRDC maintains accounts and records of transactions in accordance with accepted accounting principles. Financial statements are prepared in accordance with Schedule 1 of the CAC Act and Australian Equivalents to International Financial Reporting Standards.

Risk Management

SRDC’s risk management system is detailed in its Risk Management and Fraud Control Plans. These cover all of SRDC’s activities from portfolio to project level including transactions with external providers and contractors.

Monitoring

The SRDC R&D Plan 2003–2008 outlines strategies and performance measures that provide a framework for monitoring activities and measuring corporate performance. At the operational level, the BPMS details processes for monitoring and assessment of SRDC’s R&D activities and management performance.

ANNUAL REPORT 2005–2006 67 SRDC Board natural resources, science, technology and technology transfer, environmental Board Responsibilities and ecological matters, economics, The SRDC Board is responsible for administration of research and development, the stewardship of the corporation, finance, business management or sociology. and oversees corporate governance within SRDC. Its other functions include SRDC Directors establishing goals, setting strategic Robert G Granger direction, approving the annual budget, BEcon FAICD developing and approving a five year R&D Chair plan and ensuring that R&D resources (Non-executive) are allocated to address priority issues Re-appointed 1 October effectively. 2005 for a two year Selection and Appointment term concluding on 30 September 2007. SRDC Directors include the Chair and Government Director, who are appointed by Robert Granger was reappointed Chair of the Parliamentary Secretary to the Minister SRDC from 1 October 2005 for a two year for Agriculture, Fisheries and Forestry; the term concluding on 30 September 2007. Executive Director, who is appointed by He has extensive experience in R&D and the Board of the Corporation; and between change management in the Horticulture four and six Nominated Directors, who are industry. He is currently Chair of Wholesale appointed by the Parliamentary Secretary Ornamental Nurserymen Pty Ltd and the on the recommendation of the Sugar Queensland Banana Industry Protection Research and Development Corporation Board. He chairs the Australian Mushroom Selection Committee. Industry Advisory Committee, the Australian Avocado Industry Advisory Committee and The Executive Director is the only full-time the Australian Apple and Pear Industry Director. Advisory Committee. He was chair of the Australian Government’s Sugar Industry Directors other than the Government Guidance Group. Director and Executive Director serve on the Corporation for a term not exceeding Andrew Barfield BAgrSc three years. The Government Director’s term MBA GAICD on the Corporation is at the Parliamentary Deputy Chair Secretary’s pleasure. (Non-executive) Re-appointed 1 May Directors have experience in one or more of 2005 for three years. the following fields of expertise: commodity Member: SRDC production, commodity processing, Scholarships Committee commodity marketing, conservation of natural resources, management of

68 SUGAR RESEARCH AND DEVELOPMENT CORPORATION David C Williamson BA (Hons) Andrew Barfield is a cane farmer in Government Director the Pleystowe district and is Chairman (Non-executive) of Mackay Area Productivity Services Appointed 11 March 2003 Ltd. He is a former Director of Mackay Sugar Cooperative Association Ltd and mill representative on the Pleystowe, Racecourse, Marian and Farleigh Cane Production Boards. A 1998 Nuffield David Williamson is currently General Scholar, he was formerly Chairman of Manager of the International Technical Policy CANEGROWERS, Branch within the Department of Agriculture, Pleystowe. Fisheries and Forestry. His team works on securing and maintaining market access Russell C Muchow for Australian commodities in overseas BAgrSc (Hons) MAgrSc markets and on a range of issues under PhD FAIAST FAICD the World Trade Organization’s Agreement Executive Director on Sanitary and Phytosanitary Measures. (Executive) David was previously General Manager of Appointed in April 2001 the Rural Support and Adjustment Branch and worked on the secretariat to the 2005 Reference Group report on future directions in Agriculture and Food Policy. Prior to Russell Muchow’s appointment, 5 he was Chief Research Scientist in CSIRO David M Braddock QDA where he worked for 25 years on enhancing Director the cropping industries of northern Australia. (Non-executive) He has provided research leadership Re-appointed 1 May in using whole-of-systems approaches 2005 for three years and change management to identify and Member: SRDC Audit implement ways of increasing profitability Committee and sustainability of agricultural industries, particularly the sugar industry. He was David Braddock is Chair of the South awarded the Australian Medal of Agricultural Regional Advisory Group for the Sugar Science in 2001 for his contribution to the Industry Reform Programme 2004. He advancement of Agriculture in Australia. was a Director of the Maryborough Sugar During 2003–04, Dr Muchow was a Factory Limited from 1973 to 2005, and member of the Sugar Industry Guidance was Assistant General Manager from Group for industry reform. 1983 and Managing Director from 1999 to 2003. He has been involved in many sugar industry organisations as a grower and miller representative.

ANNUAL REPORT 2005–2006 69 Patrice A Brown (Purcell), development and IP commercialisation BSc , Cert Sugar Tech, through licensing. She has held senior MEng (Civil), Cert Env executive positions in R&D, Product Practioner, GAICD, MEIA Commercialisation and Business Director Development in biotechnology and (Non-executive) government sectors. She was formerly Re-appointed 1 May Director, International Business for BCE and 2005 for three years Director, Business Development for AGEN Member: SRDC Audit Biomedical Ltd. Committee Douglas (Mac) Hogarth Patrice Brown is an environmental advisor AM BAgrSc MScAgr PhD to a range of clients in Queensland FAIAST and NSW in her role as director of CQ Director Environmental Pty Ltd. She is also a partner (Non-executive) in a beef cattle/grain property in Central Re-appointed 1 May Queensland. 2005 for three years Chair: SRDC Scholarship Patrice was employed in the sugar Committee industry for thirteen years as a chemist and production supervisor in the Burdekin, Mac Hogarth retired from BSES in Central and Herbert districts and has since September 2002 where he was Manager provided environmental advice to CSR for Special Projects. He has worked in the and Mackay Sugar as a consultant. She sugar industry for over 40 years, principally was formerly a director of the Emerald as a plant breeder and biometrician with Agricultural College. BSES, and led the BSES plant improvement program for 12 years. He is Permanent Mary E Corbett BSc Editor of the Proceedings for ISSCT, was (Hons) PhD AFAIM FAICD Editor of ASSCT for nine years, and was Director President of ASSCT in 2001–02. He was (Non-executive) made a member of the Order of Australia, Re-appointed 1 May General Division, in the Queen’s Birthday 2005 for three years honours list in 2006. Convenor: SRDC Audit Committee

Mary Corbett is a Director of Food Science Australia and Managing Director of Australian Business Class, a Brisbane based management consulting company. She specialises in Executive facilitation and training, strategic planning, product

70 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Stephen Guazzo continuous education for members of the Director Board. (Non-executive) Appointed 28 April 2006 Roles, responsibilities and code of to 30 April 2008 conduct The roles and responsibilities of members of the Board and their code of conduct are detailed in SRDC’s BPMS. Stephen Guazzo is a third generation canegrower from the Herbert River region Meetings of the Corporation with over 35 years experience in the During the year ended 30 June 2006, the industry. Stephen has a reputation for SRDC Board met seven times, including innovative cane production and harvesting two Resolutions Without Meeting via email. practices. He has served on the Herbert Attendance of Directors at Board meetings Regional Advisory Group (RAG) and other is listed in Table 5.3. industry bodies. Under Section 54 of the PIERD Act, a Independent professional advice Director must disclose the nature of any With the Chair’s approval, directors may pecuniary or conflict of interest in any obtain independent professional advice, at matter being considered. Two Directors SRDC’s expense, on matters arising in the declared an interest on one occasion each. course of their board and committee duties. Directorships held by Directors were also recorded in the Register of Declared Interest 5 Induction and training by Directors.

New Board members go through a formal induction process, and there is a process of

Table 5.3 Directors’ attendance at Board meetings and meetings of the Audit and Scholarships Committees in 2005–06 P Brown A Barfield S Guazzo M Corbett D Hogarth R Granger R Muchow D Braddock D Williamson

Board meetings attended 7 7 7 7 7 1 7 7 7

Meetings held during membership 7 7 7 7 7 1 7 7 7

Audit committee meetings attended 2 0 2

Audit committee meetings held during membership 2 0 2

Scholarship committee meetings attended 3 4

Scholarship committee meetings held during membership 4 4

ANNUAL REPORT 2005–2006 71 Board Committees The Committee met on two occasions during 2005–06. Attendance by members To increase its effectiveness, the Board is listed in Table 5.3. The meetings were has established two committees. Both also attended by the Executive Director committees operate under policies and and the Corporation’s Accountant and/or procedures approved by the Board. Business Manager as observers to provide assistance. The Corporation’s external Audit Committee accountant and a representative of the The Audit Committee provides advice external auditor attended the August 2006 to the Board to assist it in fulfilling its meeting to comment and respond to responsibilities relating to accounting, queries on the annual accounts as required. reporting and compliance practices of the Corporation. The Committee reviews audits Scholarships Committee by the Corporation’s external auditors, The Scholarships Committee was maintains communication among the Board established to oversee the SRDC and the Corporation’s accountants, reviews scholarship scheme and at least half the the financial information presented by membership must comprise Directors of management, and reviews the adequacy of SRDC. the Corporation’s administrative, operating and accounting controls. Members of the Committee in 2005–06 were: In addition, it oversees the management of risk including the development of a risk Dr D M Hogarth, a non-executive Director profile for the Corporation, fraud control, of SRDC and chair of the Scholarships corporate governance and environmental Committee from 4 June 2002. issues. It is SRDC practice to exclude the Chair and Executive Director from Mr A Barfield, a non-executive Director of membership of the Audit Committee. SRDC and member of the Scholarships Committee from 2 August 2004. Members of the Committee in 2005–06 were: Dr T M Henderson, SRDC Investment Dr M E Corbett, a non-executive Director Manager and member of the of SRDC and member and convenor Scholarships Committee from 28 July of the Audit Committee from 2 August 2003. 2004. The Committee met on three occasions in Ms P A Brown, a non-executive Director 2005–06 to assess scholarship applications, of SRDC and member of the Audit and to interview and select successful committee from 23 March 2006. candidates. Attendance by members is listed in Table 5.3. Mr D M Braddock, a non-executive Director of SRDC and member of the Audit Committee from 2 August 2004.

72 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Consultation with stakeholders opportunity for Directors to meet with local industry representatives. The Chair and Executive Director, representing the Corporation, held formal The Chair and Executive Director held consultations with the Representative formal consultations with the Parliamentary Bodies, as required by the PIERD Act, on Secretary, the Hon. Senator Richard three occasions in 2005–06. No payments Colbeck and the Hon. Sussan Ley MP, to were made to the Representative Bodies for directly report on significant issues and these or any other consultations or purpose decisions including the industry outlook and in 2005–06. SRDC’s R&D portfolio.

The major issues discussed at the meetings The Chair also wrote to the Parliamentary with the Representative Bodies included the Secretary after each Board meeting to ongoing relevance of the SRDC R&D Plan outline key decisions taken. 2003–2008, the development of the SRDC R&D Plan 2007–2012, SRDC’s strategic During the year, the Executive Director direction and the SRDC AOP for 2006–07. made presentations to the Boards or annual meetings of CANEGROWERS, Directors interacted with the industry ACFA, ASMC, NSWSMC and Ord Industry peak bodies on several occasions during on SRDC’s role in the R&D partnership industry events, and the SRDC program of between government and industry, and Regional Workshops provided an excellent SRDC’s R&D portfolio and outcomes. 5

ANNUAL REPORT 2005–2006 73 Corporate Functions

Corporate Structure

Key Stakeholders Australian Government, ACGC, ACFA, ASMC

SRDC Board Business Manager Executive Assistant Danielle Portas Executive Director Christine Ipson Dr Russell Muchow

Communications Officer Claire Power Project Administrator Officer Regional Project Officers Kathy Mitchell (0.8FTE) (0.4FTE) and (0.2FTE)

R&D Investment R&D Investment R&D Investment Portfolio Manager Manager Manager Dr Robert Troedson (0.8FTE) Dr Les Robertson Dr Tracy Henderson

Staff Brisbane 4000. Project Officers are based in the Burdekin and Mackay. SRDC staff are employed under Section 87 of the PIERD Act. At 30 June 2006 Financial Management and Auditing the Corporation employed five full time and four part time staff in addition to the Financial statements and cash flow Executive Director. Responsibilities for each forecasts are prepared monthly and staff member are indicated above in the provided to the Board. Following the Corporate Structure. external audit of the Corporation’s financial accounts each year, the Executive Director Two part-time Project Officers were presents a Management Representation appointed in 2005–06 to support grower Memorandum to the Board for final groups successful in obtaining funding adoption of the annual financial statements. to undertake Grower/Harvester Group For the 2005–06 financial year, the Innovation Projects. memorandum was approved by the Board on 25 August 2006. Location

SRDC staff, excluding regionally based Project Officers, are located at the SRDC office at Level 16, 141 Queen Street,

74 SUGAR RESEARCH AND DEVELOPMENT CORPORATION R&D Investment Portfolio Intellectual Property Management Management SRDC’s intellectual property management Following a call for project proposals, made is based on the Intellectual Property annually in July, SRDC-appointed Working Management Plan. The Plan was developed Parties with representatives from industry, in consultation with SRDC’s major R&D government, research and extension providers, and the elements of the Plan provide advice to the SRDC Board on the have been incorporated into the SRDC proposals received. application and project management systems. The Plan ensures that intellectual Proposals are assessed using an property issues are first raised with SRDC Attractiveness/Feasibility framework. during the development of full proposals. Attractiveness includes expected economic, environmental and social benefits through Although formal ownership of intellectual adoption of outputs; potential return on property developed in most SRDC-funded investment and other inputs; communication R&D projects is vested in the research plans and industry and/or community organisations, SRDC retains an interest participation. Feasibility is based on in the exploitation of that intellectual research risk (the likelihood, with high quality property. It is a party to several patents and research, of reaching the project objectives provisional patent applications. No income and delivering the outputs and outcomes) was derived from SRDC’s intellectual and research quality (the objectives, property in 2005–06. research plan, and the skills and knowledge of the investigators). Communications 5 In 2005–06 SRDC adopted a simpler The SRDC Board re-affirmed their initial application process which helped commitment to establishing a culture of the Corporation attract broader interest open and two-way communication with in research projects. This, combined with stakeholders with the approval of the SRDC greater interaction in the development of Communications Plan 2005–06. Full Project Proposals, resulted in higher The Plan sets out the strategic intent, quality and better-targeted applications, desired outcomes, and key strategies of involving partnerships of industry, research SRDC’s activities to facilitate the and community participants. application of knowledge from SRDC’s Three R&D Investment Managers managed R&D investments and other sources. a portfolio of projects to maximise the Communication tools including SRDC return on R&D investment in delivering Update (published bi-monthly with the outcomes consistent with the accountability support of industry publications and on the expectations of SRDC’s stakeholders. SRDC website), an e-Newsletter (distributed monthly to subscribers via email) along with

ANNUAL REPORT 2005–2006 75 regular media releases help support SRDC’s A revised Risk Management Plan was communication strategies. endorsed by the Audit Committee in February 2006 and approved by the The SRDC website also provides access to Board in March 2006. The revised Risk SRDC statutory documents, SRDC Project Register identifies four strategic risks and Reports, other publications, and information four classes of operational risk. It includes and forms for funding applications. only those previously identified risks which were rated above Low after treatment, and The introduction of a CDROM supplement any new risks identified in the most recent to the Annual Report also proved to review. be successful in providing industry and researchers with easily accessible A compliance audit was conducted of information on SRDC Project Reports. selected sections of SRDC’s Business Process Management System (BPMS), Regional Workshops provide a beneficial and several refinements were identified feedback loop into the communication and implemented. The web-based BPMS needs of stakeholders. Feedback received is available internally on the SRDC Intranet throughout 2005–06 has been used in and to Directors on CDROM. the development of subsequent SRDC Communications Plans. The SRDC Business Continuity Plan was endorsed by the Audit Committee in Articles reporting results from SRDC funded February 2006 and approved by the Board R&D and published in scientific journals as in March 2006. It outlines responsibilities well as papers included in the proceedings and procedures in the event of several of major conferences are attached in scenarios that would threaten SRDC’s ability Appendix C. These include conference to continue to conduct its operations. papers presented at the annual conference of the Australian Society of Sugar Cane Indemnities for Officers Technologists held in Mackay in May 2006, other conference papers and articles SRDC has taken steps to ensure that published in recognised Australian and adequate cover for Directors and Officers international scientific journals. is in place. No other issues arose under the relevant legislation that require reporting. Risk Management

SRDC is committed to the management of risk to continue to protect its stakeholders; employees and their skills; environment; quality of service; assets and intellectual property; contractual and statutory obligations and image and reputation.

76 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Other Legislative and Occupational Health and Safety Reporting Requirements SRDC’s policy is to conduct its activities in Environment Protection and such a way as to provide an environment Biodiversity Conservation Act which protects the health, safety and welfare of staff and visitors and actively SRDC’s obligations under section 516A of encourages safe working practices. SRDC’s the Environment Protection and Biodiversity OH&S Management System sets out Conservation Act 1999 (the EPBC Act) SRDC’s OH&S policies and establishes require consideration of the environmental procedures for planning, implementation, impacts of proposals and projects. monitoring and review of OH&S matters. Research project proponents are required to outline potential risks relating to the project, No health and safety issues required and appropriate management strategies. external reporting during 2005–06.

These are considered during assessment Australian Government Disability of proposals by Working Parties and the Strategy Board. Potential and/or actual impacts of The principles of the Australian existing projects are considered during the Government Disability Strategy provide assessment of milestone reports and project that people with disabilities should reviews. No proposals or projects with have equity of participation, the right to adverse environmental consequences were inclusion in all Australian programs, the identified in 2005–06. SRDC is also required right to participation in decision making under the EPBC Act to report on how processes, and have access to information 5 SRDC’s actions accord with the principles in appropriate formats. In addition, all of ecologically sustainable development. Australian organisations are accountable This report was provided in Section 4 of this for the provision of access for people with Annual Report. disabilities. Privacy Commission In May 2003, the Board approved the SRDC complied with all obligations to the SRDC Disability Action Plan to implement Privacy Commission in 2005–06. the Australian Government Disability Strategy. The Action Plan noted that the Freedom of Information SRDC office in Brisbane is fully accessible to people with physical disabilities. The SRDC received no enquiries under the SRDC website notes that people with a Freedom of Information (FOI) Act in disability who require alternative means of 2005–06. A full FOI Statement is attached access to information on the SRDC website in Appendix D. should contact SRDC so that their needs can be addressed on an individual basis. No such requests were received in 2005–06.

ANNUAL REPORT 2005–2006 77 SRDC is both an employer and a purchaser The major role of SRDC as a purchaser as defined in the guide to performance is to invest in R&D projects. Information reporting. SRDC’s employment policies and application forms are available on the do not discriminate against people with SRDC website, and could be provided disabilities. SRDC currently has nine staff in accessible formats for people with a members including the Executive Director, disability. none of whom has a disability as defined in the Disability Discrimination Act 1992.

78 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Section 6 Financial Statements for the Year Ended 30 June 2006

6 SUGAR RESEARCH AND DEVELOPMENT CORPORATION INDEPENDENT AUDIT REPORT

INDEPENDENT AUDIT REPORT To the Minister for Agriculture, Fisheries and Forestry Matters relating to the Electronic Presentation of the Audited Financial Statements This audit report relates to the financial statements published in both the annual report and on the website of the Sugar Research and Development Corporation for the year ended 30 June 2006. The Directors are responsible for the integrity of both the annual report and the web site. The audit report refers only to the financial statements, schedules and notes named below. It does not provide an opinion on any other information which may have been hyperlinked to/from the audited financial statements. If the users of this report are concerned with the inherent risks arising from electronic data communications they are advised to refer to the hard copy of the audited financial statements in the Sugar Research and Development Corporation’s annual report. Scope The financial statements and Directors’ responsibility The financial statements comprise: • Statement by Directors and Chief Executive; • Income Statement, Balance Sheet and Statement of Cash Flows; • Statement of Changes in Equity; • Schedules of Commitments and Contingencies; and • Notes to and forming part of the Financial Statements of the Sugar Research and Development Corporation for the year ended 30 June 2006. The Directors of the Sugar Research and Development Corporation are responsible for preparing the financial statements that give a true and fair view of the financial position and performance of the Sugar Research and Development Corporation and that comply with the Finance Minister’s Orders made under the Commonwealth Authorities and Companies Act 1997, Accounting Standards and mandatory financial reporting requirements in Australia. The Directors of the Sugar Research and Development Corporation are also responsible for the maintenance of adequate accounting records and internal controls that are designed to prevent and detect fraud and error, and for the accounting policies and accounting estimates inherent in the financial statements. Audit approach I have conducted an independent audit of the financial statements in order to express an opinion on them to you. My audit has been conducted in accordance with the Australian National Audit Office Auditing Standards, which incorporate the Australian Auditing and

80 SUGAR RESEARCH AND DEVELOPMENT CORPORATION SUGAR RESEARCH AND DEVELOPMENT CORPORATION INDEPENDENT AUDIT REPORT

Assurance Standards, in order to provide reasonable assurance as to whether the financial statements are free of material misstatement. The nature of an audit is influenced by factors such as the use of professional judgement, selective testing, the inherent limitations of internal control, and the availability of persuasive, rather than conclusive, evidence. Therefore, an audit cannot guarantee that all material misstatements have been detected. While the effectiveness of management’s internal controls over financial reporting was considered when determining the nature and extent of audit procedures, the audit was not designed to provide assurance on internal controls. I have performed procedures to assess whether, in all material respects, the financial statements present fairly, in accordance with the Finance Minister’s Orders made under the Commonwealth Authorities and Companies Act 1997, Accounting Standards and other mandatory financial reporting requirements in Australia, a view which is consistent with my understanding of the Sugar Research and Development Corporation’s financial position, and of its financial performance and cash flows. The audit opinion is formed on the basis of these procedures, which included: • examining, on a test basis, information to provide evidence supporting the amounts and disclosures in the financial statements; and • assessing the appropriateness of the accounting policies and disclosures used, and the reasonableness of significant accounting estimates made by the Directors. Independence In conducting the audit, I have followed the independence requirements of the Australian National Audit Office, which incorporate the ethical requirements of the Australian accounting profession. Audit Opinion In my opinion, the financial statements of the Sugar Research and Development Corporation: (a) have been prepared in accordance with the Finance Minister’s Orders made under the Commonwealth Authorities and Companies Act 1997; and (b) give a true and fair view of the Sugar Research and Development Corporation financial position as at 30 June 2006 and of its performance and cash flows for the year then ended, in accordance with: 6 (i) the matters required by the Finance Minister’s Orders; and (ii) applicable Accounting Standards and other mandatory financial reporting requirements in Australia. Australian National Audit Office

Puspa Dash Senior Director Delegate of the Auditor-General Canberra 28 August 2006

ANNUAL REPORT 2005–2006 81 SUGAR RESEARCH AND DEVELOPMENT CORPORATION STATEMENT BY DIRECTORS AND CHIEF EXECUTIVE

In our opinion, the attached Financial Statements for the year ended 30 June 2006 are based on properly maintained financial records and give a true and fair view of the matters required by the Finance Minister’s Orders made under the Commonwealth Authorities and Companies Act 1997 as amended.

In our opinion, at the date of this statement, there are reasonable grounds to believe that the Corporation will be able to pay its debts as and when they become due and payable.

This Statement is made in accordance with a resolution of the directors.

R G Granger R C Muchow Chairman Executive Director Date: 25 August 2006 Date: 25 August 2006

82 SUGAR RESEARCH AND DEVELOPMENT CORPORATION SUGAR RESEARCH AND DEVELOPMENT CORPORATION INCOME STATEMENT for the year ended 30 June 2006

2006 2005 Notes $ $ INCOME Revenue Revenue from government 5A 5,195,040 3,755,628 Interest 5B 588,626 551,553 Industry contributions (sugar levies) 5C 5,341,747 5,131,099 TOTAL INCOME 11,125,413 9,438,280

EXPENSES Employee expenses 6A 781,177 621,380 Suppliers 6B 896,729 947,198 Depreciation and amortisation 6C 22,224 30,118 Write down/impairment of assets 6D – 15,528 Net loss from sale of assets 6E 1,275 4,588 Grants 6F 8,458,288 7,018,350 TOTAL EXPENSES 10,159,693 8,637,162

OPERATING RESULT 965,720 801,118

The above statement should be read in conjunction with the accompanying notes.

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ANNUAL REPORT 2005–2006 83 SUGAR RESEARCH AND DEVELOPMENT CORPORATION BALANCE SHEET for the year ended 30 June 2006

2006 2005 Notes $ $ ASSETS Financial assets Cash and cash equivalents 7A 2,019,691 308,562 Receivables 7B 605,266 511,653 Investments under s18 of the CAC Act 7C 6,128,865 6,794,613 Total financial assets 8,753,822 7,614,828 Non-financial assets Land and buildings 8A,C 5,933 10,754 Infrastructure, plant and equipment 8B,C 75,921 81,933 Other non-financial assets 8D 51,145 6,080 Total non-financial assets 132,999 98,767 TOTAL ASSETS 8,886,821 7,713,595

LIABILITIES Payables Suppliers 9A 83,664 45,505 Grants 9B 481,605 206,356 Other payables 9C – 130,414 Total payables 565,269 382,275 Provisions Employees 10A 175,133 150,621 Total provisions 175,133 150,621 TOTAL LIABILITIES 740,402 532,896

NET ASSETS 8,146,419 7,180,699

EQUITY Reserves 2,188 2,188 Retained surpluses/(accumulated deficits) 8,144,231 7,178,511 TOTAL EQUITY 8,146,419 7,180,699 Current assets 8,804,967 7,620,908 Non-current assets 81,854 92,687 Current liabilities 655,782 478,801 Non-current liabilities 84,620 54,096

The above statement should be read in conjunction with the accompanying notes.

84 SUGAR RESEARCH AND DEVELOPMENT CORPORATION SUGAR RESEARCH AND DEVELOPMENT CORPORATION STATEMENT OF CASH FLOWS for the year ended 30 June 2006

2006 2005 Notes $ $ OPERATING ACTIVITIES Cash Received Industry contributions (sugar levies) 5,410,236 5,233,231 Revenue from government 5,094,525 4,876,267 Interest 579,464 536,779 GST received from Australian Taxation Office 666,885 555,737 Total Cash Received 11,751,110 11,202,014 Cash Used Employees 731,155 572,986 Suppliers 815,221 596,960 Grants 9,146,685 8,886,172 Total Cash Used 10,693,061 10,056,118 Net Cash From/(Used By) Operating Activities 11 1,058,049 1,145,896

INVESTING ACTIVITIES Cash Received Proceeds from sales of property, plant and equipment 16,000 22,727 Total Cash Received 16,000 22,727 Cash Used Purchase of property, plant and equipment 28,668 35,591 Total Cash Used 28,668 35,591 6 Net Cash From/(Used By) Investing Activities (12,668) (12,864)

Net Increase/(Decrease) in Cash Held 1,045,381 1,133,032 Cash at the beginning of the reporting period 7,103,175 5,970,143 Cash at the End of the Reporting Period 11 8,148,556 7,103,175

The above statement should be read in conjunction with the accompanying notes.

ANNUAL REPORT 2005–2006 85 SUGAR RESEARCH AND DEVELOPMENT CORPORATION STATEMENT OF CHANGES IN EQUITY for the year ended 30 June 2006

Item Accumulated Asset Revaluation TOTAL EQUITY Results Reserves 2006 2005 2006 2005 2006 2005 $ $ $ $ $ $ Opening Balance 7,178,511 6,377,395 2,188 8,452 7,180,699 6,385,847 Adjusted Opening Balance 7,178,511 6,377,395 2,188 8,452 7,180,699 6,385,847 Revaluation Adjustment – – – (6,264) – (6,264) Subtotal income and expenses recognised directly in equity – – – – Net Operating Result 965,720 801,116 – – 965,720 801,116 Transactions with owner: – – – – – – Closing balance as at 30 June 8,144,231 7,178,511 2,188 2,188 8,146,419 7,180,699 Less: outside equity interests – – – – – – Total equity attributable to the Commonwealth 8,144,231 7,178,511 2,188 2,188 8,146,419 7,180,699

The above statement should be read in conjunction with the accompanying notes.

86 SUGAR RESEARCH AND DEVELOPMENT CORPORATION SUGAR RESEARCH AND DEVELOPMENT CORPORATION SCHEDULE OF COMMITMENTS for the year ended 30 June 2006

2006 2005 $ $ BY TYPE Capital Commitments Infrastructure, plant and equipment – 57,212 Total Capital Commitments – 57,212 Operating leases1 75,557 162,563 Research & Development Grants - PIERD 20,408,686 21,640,451 Total Other Commitments 20,484,243 21,803,014 Commitments Receivable (1,855,335) (1,987,293) Net Commitments by Type 18,628,908 19,872,933

BY MATURITY Capital Commitments One year or less –57,212 Total Capital Commitments –57,212 Operating Lease Commitments One year or less 62,020 73,052 From one to five years 13,537 89,511 Total Operating Lease Commitments 75,557 162,563 Research and Development Grant Commitments One year or less 10,133,725 10,137,490 From one to five years 10,272,506 11,502,961 Over five years 2,455 – Total Research and Development Grant Commitments 20,408,686 21,640,451 Commitments Receivable 6 One year or less (921,248) (933,432) From one to five years (933,864) (1,053,861) Over five years (223) – Total Commitments Receivable (1,855,335) (1,987,293) Net Commitments by Maturity 18,628,908 19,872,933

NB: Commitments are GST inclusive where relevant. 1 Operating leases included are effectively non-cancellable and comprise. Nature of lease General description of leasing arrangement Leases for office accommodation Lease payments are subject to annual increase of 4%. The initial periods of office accommodation leases are still current.

The above schedule should be read in conjunction with the accompanying notes.

ANNUAL REPORT 2005–2006 87 SUGAR RESEARCH AND DEVELOPMENT CORPORATION SCHEDULE OF CONTINGENCIES for the year ended 30 June 2006

Bank Guarantees Notes 2006 2005 $ $ Contingent Liabilities Balance from previous period 12 17,675 17,675 Total Contingent Liabilities 17,675 17,675

The above schedule should be read in conjunction with the accompanying notes.

88 SUGAR RESEARCH AND DEVELOPMENT CORPORATION SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

Note 1: Summary of Significant Accounting Policies 90 Note 2: The impact of the transition to AEIFRS from previous AGAAP 99 Note 3: Economic Dependency 100 Note 4: Events after the Balance Sheet Date 100 Note 5: Income 100 Note 6: Operating Expenses 101 Note 7: Financial Assets 102 Note 8: Non-Financial Assets 102 Note 9: Payables 104 Note 10: Provisions 104 Note 11: Cash Flow Reconciliation 105 Note 12: Contingent Liabilities and Assets 105 Note 13: Director Remuneration 106 Note 14: Related Party Disclosures 106 Note 15: Executive Remuneration 107 Note 16: Remuneration of Auditors 107 Note 17: Average Staffing Levels 107 Note 18: Financial Instruments 108 Note 19: Reporting of Outcomes 110

6

ANNUAL REPORT 2005–2006 89 SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

Note 1: Summary of Significant Accounting Policies

1.1 Objectives of Sugar Research and Development Corporation

The objective of the Sugar Research and Development Corporation (the Corporation) is to foster an innovative and sustainable Australian sugar industry through targeted investment in research and development.

The Corporation’s corporate outcome expresses the overall goal of a profitable and internationally competitive Australian sugar industry providing economic, environmental and social benefits for rural and regional communities.

1.2 Basis of Preparation of Financial Statements

The financial statements are required by clause 1(b) of schedule 1 to the Commonwealth Authorities and Companies Act 1997 and are a general purpose financial report.

The statements have been prepared in accordance with:

• Finance Minister’s Orders (or FMOs, being the Commonwealth Authorities and Companies Orders (Financial Statements for reporting periods ending on or after 1 July 2005));

• Australian Accounting Standards issued by the Australian Accounting Standards Board that apply for the reporting period; and

• Interpretations issued by the AASB and UIG that apply for the reporting period.

This is the first financial statements to be prepared under Australian Equivalents to International Finanical Reporting Standards (AEIFRS). The impacts of adopting AEIFRS are disclosed in Note 2.

The Income Statement, Balance Sheet and Statement of Changes in Equity have been prepared on an accrual basis and are in accordance with historical cost convention, except for certain assets, which as noted, are at fair value. Except where stated, no allowance is made for the effect of changing prices on the results or the financial position.

The financial statements are presented in Australian dollars and values are rounded to the nearest whole dollar.

Unless alternative treatment is specifically required by an accounting standard, assets and liabilities are recognised in the Balance Sheet when and only when it is probable that future economic benefits will flow and the amounts of the assets or liabilities can be reliably measured. However, assets and liabilities arising under agreements equally proportionately

90 SUGAR RESEARCH AND DEVELOPMENT CORPORATION SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006 unperformed are not recognised unless required by an Accounting Standard. Liabilities and assets that are unrecognised are reported in the Schedule of Commitments and the Schedule of Contingencies (other than unquantifiable or remote contingencies, which are reported at Note 12).).

Unless alternative treatment is specifically required by an accounting standard, revenues and expenses are recognised in the Income Statement when and only when the flow or consumption or loss of economic benefits has occurred and can be reliably measured.

1.3 Significant Accounting Judgement and Estimates

In the process of applying the accounting policies listed in this note, no accounting assumptions or estimates have been identified that have a significant risk of causing a material adjustment to carrying amounts of assets and liabilities within the next accounting period.

1.4 Statement of Compliance

The financial statements complies with Australian Accounting Standards, which include Australian Equivalents to International Financial Reporting Standards (AEIFRS).

Australian Accounting Standards require the Corporation to disclose Australian Accounting Standards that have not been applied, for standards that have been issued but are not yet effective.

The AASB has issued amendments to existing standards, these amendments are denoted by year and then number, for example 2005-1 indicates amendment 1 issued in 2005.

The table over page illustrates standards and amendments that will become effective for the Corporation in the future. The nature of the impending change within the table, has 6 been out of necessity abbreviated and users should consult the full version available on the AASB’s website to identify the full impact of the change. The expected impact on the financial report of adoption of these standards is based on the Corporation’s initial assessment at this date, but may change. The Corporation intends to adopt all of the standards upon the application date.

ANNUAL REPORT 2005–2006 91 SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

Title Standard Application Nature of impending change Impact affected date* expected on financial report 2005-1 AASB 139 1 Jan 2006 Amends hedging requirements for No expected foreign currency risk of a highly impact probable intra-group transaction. 2005-4 AASB 139, 1 Jan 2006 Amends AASB 139, AASB 1023 No expected AASB 132, and AASB 1038 to restrict the impact AASB 1, option to fair value through profit AASB 1023 or loss and makes consequential and amendments to AASB 1 and AASB 1038 AASB 132 2005-5 AASB 1 and 1 Jan 2006 Amends AASB 1 to allow an No expected AASB 139 entity to determine whether an impact arrangement is, or contains, a lease. Amends AASB 139 to scope out a contractual right to receive reimbursement (in accordance with AASB 137) in the form of cash.

* Application date is for annual reporting periods beginning on or after the date shown

1.5 Income

Revenue

The revenues described in this Note are revenues relating to the core operating activities of the Corporation.

Revenue is predominantly derived from levies collected from the sugar industry with matching Commonwealth Contributions in accordance with the Primary Industries and Energy Research and Development Act 1989 (PIERD).

PIERD Commonwealth Contribution revenue is recognised based on a percentage of monthly expenditure incurred by the Corporation, subject to a cap of 0.5% of the Gross Value of Production.

Interest revenue is recognised on a time proportionate basis that takes into account the effective yield on the relevant asset. Interest revenue is recognised using the effective interest method as set out in AASB 139.

92 SUGAR RESEARCH AND DEVELOPMENT CORPORATION SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

Receivables for goods and services are recognised at the nominal amounts due less any provision for bad and doubtful debts. Collectability of debts is reviewed at balance date. Provisions are made when collectability of the debt is judged to be less rather than more likely.

The full amount of the appropriation for the Corporation’s outputs for the year is recognised as revenue.

Gains

Revenue from disposal of non-current assets is recognised when control of the asset has passed to the buyer.

Contributions of assets at no cost of acquisition or for nominal consideration are recognised at their fair value when the asset qualifies for recognition.

1.6 Transactions with the Government as Owner

Equity injections

Amounts appropriated which are designated as ‘equity injections’ for a year (less any savings offered up in Portfolio Additional Estimates Statements) are recognised directly in Contributed Equity in that year.

There are no transactions with the Government in the 2006 financial year, (2005, nil).

1.7 Employee Benefits

As required by the Finance Minister’s Orders, the Corporation has early adopted AASB 119 Employee Benefits as issued in December 2004. 6 Benefits

Liabilities for services rendered by employees are recognised at the reporting date to the extent that they have not been settled.

Liabilities for ‘short-term employee benefits’ (as defined in AASB 119) and termination benefits due within twelve months of balance date are measured at their nominal amounts.

The nominal amount is calculated with regard to the rates expected to be paid on settlement of the liability.

All other employee benefit liabilities are measured as the present value of the estimated future cash outflows to be made in respect of services provided by employees up to the reporting date.

ANNUAL REPORT 2005–2006 93 SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

Leave

The liability for employee benefits includes provision for annual leave and long service leave. No provision has been made for sick leave as all sick leave is non-vesting and the average sick leave taken in future years by employees of the Corporation is estimated to be less than the annual entitlement for sick leave.

The leave liabilities are calculated on the basis of employees’ remuneration, including the Corporation’s employer superannuation contribution rates to the extent that the leave is likely to be taken during service rather than paid out on termination.

The liability for long service leave is recognised and measured at the present value of the estimated future cash flows to be made in respect of all employees at 30 June 2006. In determining the present value of the liability, the Corporation has taken into account attrition rates and pay increases through promotion and inflation.

Superannuation

The Corporation’s employees are members of the Commonwealth Superannuation Scheme (CSS), the Public Sector Superannuation Scheme (PSS) or the PSS accumulation plan (PSSap).

The CSS and PSS are defined benefit schemes for the Commonwealth. The PSSap is a defined contribution scheme.

The liability for defined benefits is recognised in the financial statements of the Australian Government and is settled by the Australian Government in due course.

The Corporation makes employer contributions to the Australian Government at rates determined by an actuary to be sufficient to meet the cost to the Government of the superannuation entitlements of the Corporation’s employees.

From 1 July 2005, new employees are eligible to join the PSSap scheme.

The liability for superannuation recognised as at 30 June represents outstanding contributions for the final fortnight of the year.

1.8 Leases

A distinction is made between finance leases and operating leases. Finance leases effectively transfer from the lessor to the lessee substantially all the risks and rewards incidental to ownership of leased non-current assets. An operating lease is a lease that is not a finance lease. In operating leases, the lessor effectively retains substantially all such risks and benefits.

94 SUGAR RESEARCH AND DEVELOPMENT CORPORATION SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

Operating lease payments are expensed on a straight line basis which is representative of the pattern of benefits derived from the leased assets.

The corporation has no finance leases.

1.9 Grants

Most grant agreements require the grantee to perform services, provide facilities or meet eligibility criteria. In these cases, the Corporation recognises grant liabilities only to the extent that the services required have been performed or the eligibility criteria have been satisfied by the grantee.

In cases where grant agreements are made without conditions to be monitored, liabilities are recognised on signing the agreement.

Grant expenses are recognised when a milestone is approved.

1.10 Cash

Cash means notes and coins held and any deposits held at call with a bank or financial institution. Cash is recognised at its nominal amount. Interest is credited to revenue as it accrues.

For purposes of the Statement of Cash Flows, Cash includes monies on short term deposit with a bank as the deposits are of short term duration and are used in the day to day management of the business.

1.11 Appropriations Receivable

These receivables are recognised at the nominal amounts due. 6 1.12 Trade Creditors

Trade creditors and accruals are recognised at their nominal amounts, being the amounts at which the liabilities will be settled. Liabilities are recognised to the extent that the goods or services have been received (and irrespective of having been invoiced).

1.13 Contingent Liabilities

Contingent Liabilities are not recognised in the Balance Sheet but are disclosed in the relevant schedules and notes. They may arise from uncertainty as to the existence of a liability, or represent an existing liability in respect of which settlement is not probable or the amount cannot be reliably measured. Remote contingencies are part of this disclosure. Where settlement becomes probable, a liability is recognised. A liability is recognised

ANNUAL REPORT 2005–2006 95 SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

when its existence is confirmed by a future event, settlement becomes probable or reliable measurement becomes possible.

1.14 Property, Plant and Equipment

Assets are recorded at cost on acquisition except as stated below. The cost of acquisition includes the fair value of assets transferred in exchange and liabilities undertaken.

Assets acquired at no cost, or for nominal consideration, are initially recognised as assets and revenues at their fair value at the date of acquisition, unless acquired as a consequence of restructuring of administrative arrangements. In the latter case, assets are initially recognised as contributions by owners at the amounts at which they were recognised in the transferor agency’s accounts immediately prior to the restructuring.

Asset Recognition Threshold

Purchases of property, plant and equipment are recognised initially at cost in the Balance Sheet, except for purchases costing less than $2,000, which are expensed in the year of acquisition (other than where they form part of a group of similar items which are significant in total).

Revaluations

Basis

Property, plant and equipment are carried at valuation, being revalued with sufficient frequency such that the carrying amount of each asset class is not materially different, at reporting date, from its fair value. Valuations undertaken in each year are as at 30 June.

Fair values for each class of asset are determined as shown below.

Leasehold improvements Depreciated replacement cost Plant and equipment Market selling price

Assets which are surplus to requirements are measured at their net realisable value. At 30 June 2006 the Corporation held no surplus assets (30 June 2005: $0)

Frequency

Plant and equipment assets are subject to a formal revaluation every four years. Formal valuations are caried out by an independent qualified valuer. Between formal valuations, property, plant and equipment values are reviewed annually by management and adjusted to fair value following Board approval.

96 SUGAR RESEARCH AND DEVELOPMENT CORPORATION SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

Leasehold improvements subject to formal valuations are each revalued progressively on a geographical basis. In between formal valuations, these assets are revalued using an appropriate index reflecting movements in the value of similar assets.

Depreciation

Depreciable property, plant and equipment assets are written-off to their estimated residual values over their estimated useful lives to the Corporation using, in all cases, the straight-line method of depreciation. Leasehold improvements are depreciated on a straight-line basis over the lesser of the estimated useful life of the improvements or the unexpired period of the lease.

Depreciation rates (useful lives) and methods are reviewed at each reporting date and necessary adjustments are recognised in the current, or current and future reporting periods, as appropriate. Residual values are re-estimated for a change in prices only when assets are revalued.

Depreciation rates applying to each class of depreciable asset are based on the following useful lives:

2006 2005 Computer equipment 3 years 3 years 1 Furniture and fittings 13 __ years 13 __1 years 3 3 Leasehold improvements Lease term Lease term 2 Motor vehicles 6 __ years 6 __2 years 3 3

Impairment 6 All property, plant and equipment were assessed for impairment at 30 June 2006. Where indications of impairment exist, the asset’s recoverable amount is estimated and an impairment adjustment made if the asset’s recoverable amount is less than its carrying amount.

The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use. Value in use is the present value of the future cash flows expected to be derived from the asset. Where the future economic benefit of an asset is not primarily dependent on the asset’s ability to generate future cash flows, and the asset would be replaced if the Corporation were deprived of the asset, its value in use is taken to be its depreciated replacement cost.

No indicators of impairment were found for property, plant and equipment held at fair value.

ANNUAL REPORT 2005–2006 97 SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

1.15 Impairment of Financial Assets

As prescribed in the Finance Minister’s Orders, the Corporation has applied the option available under AASB 1 of adopting AASB 132 and 139 from 1 July 2005 rather than 1 July 2004.

Financial assets are assessed for impairment at each balance date.

Financial Assets held at Amortised Cost

If there is objective evidence that an impairment loss has been incurred for receivables, the amount of the loss is measured as the difference between the asset’s carrying value and the present value of the estimated future cash flows discounted at the asset’s original effective interest rate. The carrying amount is reduced by way of an allowance account. The loss is recognised in the profit and loss.

Comparative Year

The above policies were not applied for the comparative year. For receivables, amounts were recognised and carried at original invoice amount less a provision for doubtful debts based on an estimate made when collection of the full amount was no longer probable. Bad debts were written off as incurred.

Other financial assets carried at cost which were not held to generate net cash inflows, were assessed for indicators of impairment. Where such indicators were found to exist, the recoverable amount of the assets was estimated and compared to the assets carrying amount and, if less, reduced to the carrying amount. The reduction was shown as an impairment loss.

No impairment indicators were found for financial assets.

1.16 Financial Risk Management

The Corporation’s activities expose it to normal commercial financial risk. As a result of the nature of the Corporation’s business and internal and Australian Government policies, dealing with the management of financial risk, the Corporation’s exposure to market, credit, liquidity and cash flow and fair value interest rate risk is considered to be low.

1.17 Taxation

The Corporation is exempt from all forms of taxation except fringe benefits tax and the goods and services tax (GST).

98 SUGAR RESEARCH AND DEVELOPMENT CORPORATION SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

Revenues, expenses and assets are recognised net of GST:

• except where the amount of GST incurred is not recoverable from the Australian Taxation Office; and

• except for receivables and payables.

1.18 Foreign Currency

Transactions denominated in a foreign currency are converted at the exchange rate at the date of the transaction. Foreign currency receivables and payables are translated at the exchange rates current as at balance date. Associated currency gains and losses are not material.

1.19 Insurance

The Corporation has insured for risks through the Government’s insurable risk managed fund, called ‘Comcover’. Workers’ compensation is insured through the Government’s Comcare Australia.

Note 2: The impact of the transition to AEIFRS from previous AGAAP

2005 2004 $$ Reonciliation of total equity as presented under previous AGAAP to that under AEIFRS Total equity under previous AGAAP 7,180,699 6,385,846 Adjustments to retained earnings 0 0 Adjustments to other reserves 0 06 Total Equity translated to AEIFRS 7,180,699 6,385,846 Reconciliation of profit or loss as presented under previous AGAAP to AEIFRS Prior year profit as previously reported 801,118 Adjustments 0 Prior year profit translated to AEIFRS 801,118

The cash flow statement presented under previous AGAAP is equivalents to that prepared under AEIFRS.

ANNUAL REPORT 2005–2006 99 SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

Note 3: Economic Dependency

The normal operating activities of the the Corporation are dependent on the receipt of sugar levies from cane growers and millers which are collected by the Australian Government and then remitted to the Corporation.

The Corporation is also economically dependent on funding from the Australian Government for its continued existence and ability to carry out its normal activities. The Government provides funding to the Corporation on the basis of a multiple of the sugar levies collected from cane growers and millers.

Note 4: Events after the Balance Sheet Date

No events have occurred after balance date that affect the Corporation’s 2005–06 financial statements.

2006 2005 Note 5: Income $$

Revenues Note 5A: Revenues from government Commonwealth contribution - PIERD Act 4,765,626 3,527,042 Commonwealth contribution - FMS 429,414 228,586 Total revenues from government 5,195,040 3,755,628

Note 5B: Interest Cash at bank 76,950 104,251 Short term deposits 511,676 447,302 Total interest 588,626 551,553

Note 5C: Industry contributions (sugar levies) Industry contributions (sugar levies) 5,341,747 5,131,099 Total Industry contributions (sugar levies) 5,341,747 5,131,099

100 SUGAR RESEARCH AND DEVELOPMENT CORPORATION SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

2006 2005 Note 6: Operating Expenses $$

Note 6A: Employee expenses Wages and salaries 602,959 475,021 Superannuation 73,560 65,073 Leave and other entitlements 104,658 81,286 Total employee expenses 781,177 621,380

Note 6B: Suppliers Provision of goods - external entities 38,522 51,162 Provision of services - external entities 781,424 827,923 Operating lease rentals 74,839 66,558 Workers’ compensation premium 1,944 1,555 Total suppliers 896,729 947,198

Note 6C: Depreciation and amortisation Depreciation Plant and equipment 16,169 22,236 Leasehold improvements 4,823 3,294 Motor vehicles 1,232 4,588 Total Depreciation 22,224 30,118

Note 6D: Write down and impairment of assets Non-financial assets Property, plant & equipment - revaluation decrement – 15,528 Total write-down of assets – 15,528 6

Note 6E: Net Losses from sale of assets Property, plant and equipment: Proceeds from disposal (44,090) (22,727) Net book value of assets disposed 45,365 27,315 Total net loss from disposal of assets 1,275 4,588

Note 6F: Grants The Corporation makes grants to support research and development for the sugar industry in Australia Research and development grants - PIERD 8,458,288 7,018,350 Total grants 8,458,288 7,018,350

ANNUAL REPORT 2005–2006 101 SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

2006 2005 Note 7: Financial Assets $$

Note 7A: Cash and Cash Equivalents Cash at bank 2,019,191 308,062 Cash on hand 500 500 Total cash and cash equivalents 2,019,691 308,562 All cash recognised is a current asset.

Note 7B: Receivables Goods and services 1,253 - GST receivable from the Australian Taxation Office 353,341 193,560 Interest receivable 39,016 29,855 Industry contributions receivable 211,656 288,238 Total receivables (net) 605,266 511,653 All receivables are current assets.

Note 7C: Investments under s18 of the CAC Act Term deposits 6,128,865 6,794,613 Total investments 6,128,865 6,794,613 All investments are current assets.

Term deposits are with the Corporation’s bank, and earn an effective rate of interest of 5.32% (2005: 5.58%) payable upon maturity. Terms are between 9 days and 4 months.

2006 2005 Note 8: Non-Financial Assets $$

Note 8A: Land and Buildings Leasehold improvements – at 2005 valuation 13,500 13.500 – Accumulated amortisation (7,567) (2,746) Total leasehold improvements (non-current) 5,933 10,754

Note 8B: Property, Plant and Equipment Property, plant and equipment – at 2005 valuation 93,625 92,368 – Accumulated depreciation (17,704) (10,435) Total Property, Plant and Equipment (non-current) 75,921 81,933

All revaluations are conducted in accordance with the revaluation policy stated in Note 1.

102 SUGAR RESEARCH AND DEVELOPMENT CORPORATION SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

Note 8C: Analysis of Property, Plant and Equipment

TABLE A – Reconciliation of the Opening and Closing Balances of Property, Plant and Equipment

Item Buildings Property, TOTAL – Leasehold Plant & Improvements Equipment $$$ As at 1 July 2005 Gross book value 13,500 92,368 105,868 Accumulated depreciation/amortisation (2,746) (10,435) (13,181) Opening net book value 10,754 81,933 92,687

By purchase – 56,758 56,758 Depreciation/amortisation expense (4,823) (17,401) (22,224) From disposal – (45,366) (45,366)

As at 30 June 2006 Gross book value 13,500 93,626 107,126 Accumulated depreciation/amortisation (7,567) (17,704) (25,271) Closing net book value 5,933 75,922 81,855

2006 2005 6 $$ Note 8D: Other Non-Financial Assets Prepayments 51,145 6,080 Total other non-financial assets 51,145 6,080 All other non-financial assets are current assets.

ANNUAL REPORT 2005–2006 103 SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

2006 2005 Note 9: Payables $$

Note 9A: Suppliers Trade creditors 83,664 45,505 Total suppliers 83,664 45,505 All supplier payables are current liabilities.

Note 9B: Grants Payable Grants payable 481,605 206,356 Total grants payable 481,605 206,356 All grants payable are current liabilities.

Note 9C: Other Payables Unearned revenue – 130,414 Total other payables – 130,414 All other payables are current liabilities.

2006 2005 Note 10: Provisions $$

Note 10A: Employee Provisions Salaries and wages 3,484 6,032 Leave 171,158 132,246 Superannuation 491 12,343 Total employee provisions 175,133 150,621 Employee provisions are represented by: Current 90,513 96,525 Non-current 84,620 54,096 175,133 150,621

104 SUGAR RESEARCH AND DEVELOPMENT CORPORATION SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

2006 2005 Note 11: Cash Flow Reconciliation $ $

Reconciliation of cash per Balance Sheet to Statement of Cash Flows Cash at year end per Statement of Cash Flows 8,148,556 7,103,175 Balance Sheet items comprising above cash: ‘Financial Asset – Cash’ 2,019,691 308,562 ‘Financial assets – Investments under s18 of CAC Act’ 6,128,865 6,794,613 8,148,556 7,103,175 Reconciliation of operating result to net cash from operating activities: Operating result 965,720 801,116 Depreciation and amortisation 22,224 30,118 Write down/impairment of assets – 15,528 Net loss from sale of assets 1,276 4,588 Change in operating assets and liabilities resulting from operating activities: (Increase)/decrease in net receivables (138,677) 1,386,160 Increase/(decrease) in employee provisions 38,912 49,951 Increase/(decrease) in supplier payables 23,759 (33,161) Increase/(decrease) in grants payable 275,249 (1,138,818) Increase/(decrease) in other payables (130,414) 30,414 Net cash from/(used by) operating activities 1,058,049 1,145,896 6

2006 2005 Note 12: Contingent Liabilities and Assets $$

Quantifiable Contingencies Contingent liabilities Bank guarantees 17,675 17,675 Total Contingent Liabilities 17,675 17,675 The bank guarantee is provided over the lease of the head office premises occupied in Level 16/141 Queen Street, Brisbane.

ANNUAL REPORT 2005–2006 105 SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

2006 2005 Note 13: Director Remuneration $$

The number of directors of the Corporation included in these figures are shown below in the relevant remuneration bands: Nil to $14,999 1 1 $15,000 to $29,999 5 5 $30,000 to $44,999 1 1 $180,000 to $194,999 – 1 $195,000 to $209,999 1 – Total number of directors of the Corporation 8 8

Part-time directors and the Chairman of the Corporation received fees and allowances as determined by the Remuneration Tribunal. The Executive Director is the only full-time director of the Corporation and receives a salary and allowances as approved by the Board. Remuneration includes salary, allowances and superannuation.

The total remuneration of these Officers is $293,948 (2005: $258,118).

Note 14: Related Party Disclosures

Directors of the Corporation The Directors of the Authority during the year were:

RG Granger Chairman (re-appointed 1 October 2005) RC Muchow Executive Director A Barfield Deputy Chairman DM Braddock Audit Committee PA Brown Audit Committee ME Corbett Audit Committee Convenor DM Hogarth Director DC Williamson Government Director

The aggregate remuneration of Directors is disclosed in Note 13.

Grants were made to Mackay Area Productivity Services Ltd and the Australian Society of Sugar Cane Technology, of which Andrew Barfield is Chairman and Director respectively. All transactions with these organisations were under normal terms and conditions. The Directors involved took no part in the relevant decisions of the Board.

106 SUGAR RESEARCH AND DEVELOPMENT CORPORATION SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

2006 2005 Note 15: Executive Remuneration $$

The number of senior executives who received or were due to receive total remuneration of $130,000 or more: $190,000 to $204,999 1 1 Total 1 1 The aggregate amount of Executive Director remuneration is included in note 13 above.

2006 2005 Note 16: Remuneration of Auditors $$

The cost of financial statement audit services provided to the Corporation were: 12,000 11,800 12,000 11,800 No other services are provided by the Auditor-General during the reporting period.

2006 2005 Note 17: Average Staffing Levels $ $

The average staffing levels for the Corporation during the year were: 8 7 6

ANNUAL REPORT 2005–2006 107 SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

Note 18: Financial Instruments

Note 18A: Interest Rate Risk Financial Notes Floating Interest Fixed Interest Rate Instrument Rate Maturing In

1 Year or Less 1 to 5 Years 2006 2005 2006 2005 2006 2005 $ $ $ $ $ $ Cash 7A 2,019,191 308,062 – – – – Receivables 7B – – – – – – Investments 7C – – 6,128,865 6,794,613 – – Accrued interest 7B – – – – – – Total 2,019,191 308,062 6,128,865 6,794,613 – –

Financial Liabilities Trade creditors 9A – – – – – – Grants payable 9B – – – – – – Other payables 9C – – – – – – Total – – – – – –

Note 18B: Fair Values of Financial Assets and Liabilities Notes Total Total Carrying Aggregate Carrying Aggregate Amount Fair Value Amount Fair Value 2006 2006 2005 2005 $ $ $ $ Financial Assets Cash 7A 2,019,691 2,019,691 308,562 308,562 Interest receivable 7B 39,016 39,016 29,855 29,855 Other receivables 7B 211,656 211,656 288,238 288,238 Term deposits 7C 6,128,865 6,128,865 6,794,613 6,794,613 Total Financial Assets 8,399,228 8,399,228 7,421,268 7,421,268 Financial Liabilities Trade creditors 9A 83,664 83,664 45,505 45,505 Grants payable 9B 481,605 481,605 206,357 206,357 Other payables 9C ––130,414 130,414 Total Financial Liabilities (Recognised) 565,269 565,269 382,276 382,276

108 SUGAR RESEARCH AND DEVELOPMENT CORPORATION SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

(Note 18A: Interest Rate Risk — continued) Fixed Interest Rate Non-Interest Total Weighted Average Maturing In Bearing Effective Interest Rate > 5 Years 2006 2005 2006 2005 2006 2005 2006 2005 $ $ $ $ $ $ % % – – 500 500 2,019,691 308,562 4.75 5 – – 212,909 288,238 212,909 288,238 – – – – 6,128,865 6,794,613 5.32 5.58

– – 39,016 29,855 39,016 29,855 – – 252,425 318,593 8,400,481 7,421,268

– – 83,664 45,505 83,664 45,505 – – 481,605 206,357 481,605 206,357 – – – 130,414 – 130,414 – – 565,269 382,276 565,269 382,276

6

ANNUAL REPORT 2005–2006 109 SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

Note 18C: Credit Risk Exposures

The Corporation’s maximum exposures to credit risk at reporting date in relation to each class of recognised financial assets is the carrying amount of those assets as indicated in the Balance Sheet.

The Corporation has no significant exposures to any concentrations of credit risk.

All figures for credit risk referred to do not take into account the value of any collateral or other security.

Note 19: Reporting of Outcomes

Note 19A: Outcomes of the Corporation

The Corporation core business is ‘to foster an innovative and sustainable Australian sugar industry through targeted investment in research and development’.

The Corporation is structured to meet one outcome; ‘A profitable and internationally competitive Australian sugar industry providing economic, environmental and social benefits for rural and regional communities’.

Four Output groups have been identified as contributing to the one corporate outcome:

1.1. Whole of system solutions based on integrated management of the value chain, particularly at mill area and regional areas (Program A).

1.2. Sustainable sugarcane production systems based on integrated management of resources at farm level (Program B).

1.3. Flexible, cost effective systems for sustainable harvest, transport, milling and marketing based on innovative design (Program C).

1.4. Enhanced human capacity for change, learning and innovation in the sugar industry (Program D).

The actual grant expenses of the Outcomes is applied to the four output groups. All other revenues and expenses are allocated on a proportionate basis.

110 SUGAR RESEARCH AND DEVELOPMENT CORPORATION SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

Note 19B: Net Cost of Outcome Delivery Outcome 1 Total 2006 2005 2006 2005 $$$$ Expenses Administered expenses – – – – Departmental expenses 10,159,693 8,637,162 10,159,693 8,637,162 Total expenses 10,159,693 8,637,162 10,159,693 8,637,162 Costs recovered from provision of goods and services to the non-government sector Administered – – – – Departmental – – – – Total costs recovered – – – – Goods and Services Income from 5,341,747 5,131,099 5,341,747 5,131,099 Related Entities Interest 588,626 551,553 588,626 551,553 Total Departmental 5,930,373 5,682,652 5,930,373 5,682,652 Total other external income 5,930,373 5,682,652 5,930,373 5,682,652 Net cost/(contribution) of outcome 4,229,320 2,954,510 4,229,320 2,954,510

6

ANNUAL REPORT 2005–2006 111 SUGAR RESEARCH AND DEVELOPMENT CORPORATION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the year ended 30 June 2006

Note 19C: Corporation Income and Expenses by Output Groups and Outputs Outcome 1 Output 1 Output 2 Output 3 2006 2005 2006 2005 2006 2005 $ $ $ $ $ $ Operating expenses Employees 117,468 129,384 383,729 292,156 133,131 100,105 Suppliers 134,218 196,410 438,445 443,507 152,113 151,965 Grants 1,268,743 1,457,711 4,144,561 3,291,606 1,437,909 1,127,849 Depreciation and amortisation 3,334 6,256 10,890 14,125 3,778 4,840 Write down/impairment of assets – 3,225 – 7,283 – 2,495 Net loss from sale of assets 191 952 625 2,152 217 738 Total operating expenses 1,523,954 1,793,938 4,978,250 4,050,829 1,727,148 1,387,992 Funded by: Income from government 779,256 780,044 2,545,570 1,761,390 883,157 603,529 Interest 88,294 114,558 288,427 258,678 100,066 88,635 Industry contributions (sugar levies) 801,262 1,065,729 2,617,456 2,406,485 908,097 824,568 Total operating income 1,668,812 1,960,331 5,451,453 4,426,553 1,891,320 1,516,732

Outcome 1 (continued) Output 4 Total 2006 2005 2006 2005 $ $ $ $ Operating expenses Employees 148,793 101,290 783,121 622,935 Suppliers 170,009 153,761 894,785 945,643 Grants 1,607,075 1,141,184 8,458,288 7,018,350 Depreciation and amortisation 4,222 4,897 22,224 30,118 Write down of assets – 2,525 – 15,528 Net loss from disposal of assets 242 746 1,275 4,588 Total operating expenses 1,930,341 1,404,403 10,159,693 8,637,162 Funded by: Income from government 987,057 610,665 5,195,040 3,755,628 Interest 111,839 89,682 588,626 551,553 Industry contributions (sugar levies) 1,014,932 834,317 5,341,747 5,131,099 Total operating income 2,113,828 1,534,664 11,125,413 9,438,280

112 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Appendix A

Current Research Project Listing (2005–06)

Progress Reports and Final Report Summaries, except for those projects that have confidential reports, can be found on the supplementary Annual Report CD–ROM (available upon request).

Project Title Lead Organisation Research Contact Funds Program A Value Chain Integration Strategy Optimising use of whole-of-system resources BSS264 Adoption of an optimal season length for BSES Limited Mr Lawrence $122,860 increased industry profitability DiBella CSE004 Improving yield forecasting capability CSIRO Sustainable Dr Yvette $27,000 to enhance market strategies for the Ecosystems Everingham Australian sugar industry CSR033 Benchmarking harvest group practices in CSR Sugar Dr Lisa McDonald $66,398 the Burdekin CVA002 Managing Climate Variability Program Land and Water Dr Tracy Henderson $40,000 Australia MAS001 A regional partnership approach to Mossman Mr Allan Rudd $118,969 developing a sustainable sugar cane Agricultural system Services MSA003 A cooperative systems model for the Mackay Sugar Mr Geoff Fleming $30,000 Mackay regional sugar industry Cooperative Association Ltd NSC005 Implementing an integrated sugar New South Wales Mr Rick Beattie $76,000 system in NSW Sugar Milling Co- operative Ltd Program A Value Chain Integration Strategy Facilitating sustainable whole-of-system change BSS261 Measurement and feedback systems for BSES Limited Mr Trevor Willcox $36,000 improving market signals for harvesting CSE005 Integrating and optimising farm-to- CSIRO Sustainable Dr Andrew Higgins $175,950 mill decisions to maximise industry Ecosystems 7 profitability CSE009 Moving from case studies to whole of CSIRO Sustainable Dr Yvette $217,366 industry: Implementing methods for Ecosystems Everingham wider industry adoption CSE010 Integrated value chain scenarios for CSIRO Sustainable Dr Peter Thorburn $75,217 enhanced mill region profitability Ecosystems

ANNUAL REPORT 2005–2006 113 Project Title Lead Organisation Research Contact Funds CSE013 Increasing the capacity to identify CSIRO Sustainable Dr Andrew Higgins $4,846 and action value chain integration Ecosystems opportunities HGP001 Establishing a million tonne harvesting Richmond River Mr Andrew Tickle $0 co-operative Cane Growers’ Association Ltd HGP004 Demonstrate the true value of harvesting Mackay Sugar Mr Jim Crane $0 best practice and provide the basis for Cooperative the sharing of the additional revenue Association Ltd created by its adoption HGP006 Improved harvesting efficiency in farming Tabone Harvesting Mr Brian Tabone $30,000 systems – Group No. 131 HGP007 Siding roster optimisation in the Herbert CANEGROWERS Mr Franco Zaini $25,000 Herbert River HGP008 Incentive price harvesting signals versus Ripple Creek Mr Anthony Girgenti $27,000 traditional payment system Harvesting MAS002 Improving harvest efficiency in the Mossman Mr Daryl Parker $44,000 Mossman Central Mill area Agricultural Services NSC006 Achieving world’s best practice New South Wales Mr Rick Beattie $118,267 harvesting and transport costs for the Sugar Milling Co- NSW sugar industry operative Ltd SRD001 Cane harvesting to improve industry Sugar Research Dr Les Robertson $0 performance and Development Corporation SRD004 Value Chain Workshop Sugar Research Dr Tracy Henderson $86,859 and Development Corporation Program B Farming Systems Strategy Underpinning sustainable farming systems BSS122 Nutrients and pesticides in surface BSES Limited Mr Gary Ham $0 drainage water and soil under irrigated sugarcane BSS197 Products and mechanisms for BSES Limited Mr Gary Ham $25,000 amelioration of sodic soils BSS260 Enhanced delivery of PROSPER to BSES Limited Mr Eoin Wallis $286,000 achieve adoption of Best Management Practices in the Queensland sugar industry

114 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Project Title Lead Organisation Research Contact Funds CG013 Growers working together to improve CANEGROWERS Dr Tim Wrigley $114,450 water quality in the Herbert Sugar Herbert River Industry CG018 A review of institutional arrangements Queensland Dr Tim Wrigley $0 in the Burdekin Irrigation Area with a Canegrowers view to managing sustainable farming Organisation practices in the region CPI005 Adapting soybean for profitable rotations CSIRO Plant Dr Andrew James $10,000 in sugarcane farming systems Industry CPI009 New soybean varieties for fallow CSIRO Plant Dr Andrew James $22,356 cropping of sugarcane fields Industry CSE001 Increased profitability and water use CSIRO Sustainable Dr Geoff Inman- $20,000 efficiency through best use of limited Ecosystems Bamber water under supplementary irrigation CSE007 Implementation of irrigation practices for CSIRO Sustainable Dr Geoff Inman- $90,513 profitable resource efficient sugarcane Ecosystems Bamber production in the Ord DPI015 Enhancing an economic way of doing Queensland Mr Neil Sing $80,000 business in the cane industry Department of Primary Industries & Fisheries FMS001 Farm Management Systems for the AGRECON Mr Don Chambers $15,055 Sugar Cane Industry, Sub-program 1: Interactive web-based material to support FMS FMS002 Farm Management Systems for the AGRECON Mr Don Chambers $98,993 Sugarcane Industry, Sub-program 2: Environmental and economic performance indicators FMS004 Farm Management Systems for the AGRECON Mr Don Chambers $18,611 Sugarcane Industry, Sub-program 4: Options for auditing and certification 7 of FMS FMS007 Land and Water Management Plan AGRECON Mr Simon Holloway $50,000 drafting tools for the FMS framework FMS008 Farm health and safety tools for the AGRECON Mr Don Chambers $22,500 Sugar FMS framework

ANNUAL REPORT 2005–2006 115 Project Title Lead Organisation Research Contact Funds MAF001 Irrigation runoff event monitoring Mulgrave Area Mr Chris Hesp $20,000 Farm Integrated Action NSC008 Setting productivity and cost savings New South Wales Mr Rick Beattie $13,900 targets for the NSW sugar industry Sugar Milling Co-operative Ltd ORD003 Ord sugar industry extension services CSR Sugar Dr Andrew Wood $0 SRD002 Case studies of improved economic Sugar Research Dr Les Robertson $5,400 performance from implementing and Development innovations on farms. Corporation UNW003 Development of a constructed wetland The University of Assoc Prof Mike $17,800 for improving water quality in sugarcane New South Wales Melville drainage, and ensuring its community acceptance and industry adoption Program B Farming Systems Strategy Improving the genetic performance of the sugarcane plant BSS250 Improving selection systems and data BSES Limited Dr Xianming Wei $90,772 analysis in sugarcane breeding programs BSS255 Improving the plant breeding selection BSES Limited Mr Barry Croft $13,700 system for Fiji disease resistance BSS256 Reducing the Australian sugar industry’s BSES Limited Mr Barry Croft $86,873 genetic vulnerability to sugarcane smut BSS258 Assessing the impact that pathogen BSES Limited Mr Kathy $2,000 variation has on the sugarcane breeding Braithwaite program BSS265 Smut-proofing the Australian industry BSES Limited Mr Barry Croft $64,911 – ensuring a reliable cane supply through reduced genetic vulnerability to sugarcane smut BSS267 Maximising whole-of-industry benefits BSES Limited Dr Xianming Wei $257,500 from the Australian sugarcane improvement program through an optimal genetic evaluation system BSS295 Scoping study – remote sensing of BSES Limited Dr Robert Magarey $4,500 sugarcane leaf diseases CRC002 Application of molecular markers to CRC Sugar Dr Phillip Jackson $324,883 sugarcane breeding Industry Innovation through Biotechnology

116 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Project Title Lead Organisation Research Contact Funds CSE014 Increased CCS, cane yield and water CSIRO Sustainable Dr Geoff Inman- $202,041 use efficiency by exploiting interactions Ecosystems Bamber between genetics and management ORD001 Introduction of existing new varieties CSR Sugar Dr Andrew Wood $0 UQ039 Gene control sequences for metabolic The University of Dr Robert Birch $20,000 engineering in sugarcane Queensland UQ040 Extending Sugar Booster technology into The University of Dr Robert Birch $252,650 multiple sugarcane cultivars for optimal Queensland deployment by Australian industry Program B Farming Systems Strategy Integrated solutions for sustainable sugarcane production BSS257 GrubPlan 2: Developing improved risk BSES Limited Dr Peter Samson $138,502 assessment and decision-support systems for managing greyback canegrub BSS266 Optimum canegrub management within BSES Limited Dr Peter Samson $153,908 new sustainable cropping systems BSS268 Accelerated adoption of best-practice BSES Limited Dr Bernard $145,000 nutrient management Schroeder BSS269 A new cropping system for the Central BSES Limited Mr Bradley Hussey $104,253 District BSS286 Improved sugar-cane farming systems BSES Limited Dr Alan Garside $469,644 CSE011 Improved environmental outcomes CSIRO Sustainable Dr Peter Thorburn $271,869 and profitability through innovative Ecosystems management of nitrogen CSE012 Adopting systems approaches to water CSIRO Sustainable Dr Peter Thorburn $218,920 and nutrient management for future cane Ecosystems production in the Burdekin GGP003 Implementation of controlled traffic Pinnacle Precision Mr Ed Morris $23,625 farming of sugarcane in the Herbert River Farming district 7 GGP004 Implementation of improved sugarcane Mulgrave Mr Paul Hatch $36,000 farming systems in the Clare area of the Integrated Group Burdekin District GGP005 Healthy farming in the upper Haughton Upper Haughton Mr Vince Papale $3,000 Harvesting Pty Ltd

ANNUAL REPORT 2005–2006 117 Project Title Lead Organisation Research Contact Funds GGP006 Precision farming with controlled traffic Septimus Farming C & G Vassallo $40,000 and GPS guidance system Groups (c/- CR & GM Vassallo Farming P/L) GGP007 Controlled traffic farming systems for the Mackay Area Mr John Fox $40,000 North Coast Grower Group Productivity Services GGP009 Implementing zero-till planting systems in NSW Farming Mr Alan Munro $45,000 the NSW sugar industry Systems Group GGP010 Accurate, consistent bed forming to MAD Cane Mr Anthony $9,500 promote better farming practices Planting Durrington IBS002 Specialist grower groups enhancing Innisfail Babinda Mr Bill Horsford $59,250 BMP packaging & adoption in Innisfail & Cane Productivity Babinda districts Services Ltd ORD002 Ord sugar industry pathology services CSR Sugar Dr Andrew Wood $0 WAA003 Evaluation and Implementation of Department Dr Joe Sherrard $65,810 modified farming systems in the ORIA of Agriculture Western Australia YDV002 Sugar Yield Decline Joint Venture (Phase 2) BSES Limited Dr Alan Garside $118,000 Program C Processing and Distribution Systems Strategy Enhancing capability in processing and distribution systems QUT004 Commercial evaluation of alternative juice Queensland Dr William Doherty $87,358 clarification processes University of Technology QUT011 Factory trials with a novel cleaning Queensland Dr William Doherty $35,500 formulation University of Technology SRI122 The functional relationship between juice Sugar Research Dr Ross Broadfoot $10,000 properties, operating conditions and heat Institute transfer in Roberts evaporators SRI123 Crystallisation studies in a pilot batch Sugar Research Dr Ross Broadfoot $50,000 vacuum pan Institute Program C Processing and Distribution Systems Strategy Innovative technology and best management practices AGX001 Harvester best practice on-board expert Agtrix Pty Ltd Mr Robert Crossley $30,000 system and monitoring BSS270 Regional adoption of alternative BSES Limited Mr Cam Whiteing $206,000 harvester configurations for sustainable harvesting efficiency

118 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Project Title Lead Organisation Research Contact Funds GGP008 Overcoming barriers to controlled traffic Sarina Sustainable Mr Brian Stevens $22,000 adoption – Managing traffic during Farmers Group conversion to controlled traffic farming systems HGP002 Design and build a moving wall on side Pacific Cane Mr Mark North $25,900 tipping cane transporters Harvesting HGP003 Modified rotary-pinch chopper system Bundaberg Sugar Mr Mike Smith $8,000 for improved harvesting efficiency Ltd HGP005 Develop and assess adaptability of Linton & Walsh Mr Joe Linton $17,539 different row spacings for harvester fronts HGP009 Electronic logbook for harvest record Murray Harvesting Mr Brian Dore $12,000 keeping Pty Ltd QUT005 Determination of factory benefits from full Sugar Research Mr Rod Steindl $222,466 implementation of syrup clarification Institute QUT012 Improving the cost-effectiveness of mud Queensland Dr Ross Broadfoot $19,308 filtration through modern technology University of Technology SRI049 Aerodynamic optimisation of extraction Sugar Research Dr Phil Hobson $0 chambers for high pour-rate pneumatic Institute cane cleaning devices SRI052 A transport model for airborne particles Sugar Research Dr Phil Hobson $0 associated with bagasse Institute SRI107 Improved transfer to mills of technology Sugar Research Mr John Kenny $19,352 developed by the Sugar Research Institute Institute SRI136 Low cost and energy efficient ambient Sugar Research Dr Phil Hobson $121,372 drying of large-scale bagasse and trash Institute stockpiles for increased industry income from power generation SRI137 Factory trial of modified long life roll shell Sugar Research Dr Geoff Kent $51,850 surface Institute 7 SRI138 Increase the energy efficiency and Sugar Research Dr Ross Broadfoot $96,606 revenue of sugar factories Institute SRI141 A preliminary assessment of methods to Sugar Research Dr William Doherty $35,831 measure in-field sugar loss Institute SRI142 Evaluation of an alternative process for Sugar Research Mr Kameron Dunn $27,000 sugar manufacture Institute

ANNUAL REPORT 2005–2006 119 Project Title Lead Organisation Research Contact Funds Program C Processing and Distribution Systems Strategy Diversifying the income stream CRC003 Use of sugarcane as a biofactory for CRC Sugar Dr Stevens $67,903 production of biopolymers Industry Brumbley Innovation through Biotechnology CRC004 Sucrose derivative production in CRC Sugar Dr Barrie Fong $104,322 sugarcane Industry Chong Innovation through Biotechnology JCU025 Thermoformable biodegradable James Cook Prof Chris Berndt $182,200 composite material from sugar cane University bagasse fibre QUT008 Analysis of bagasse and trash utilisation Queensland Dr Phil Hobson $17,000 options University of Technology SRD005 Bagasse and Trash Utilisation Workshop Sugar Research Dr Les Robertson $3,276 and Development Corporation Program D Industry Capacity Strategy Enhancing capacity to learn and change ABC001 Sugarcane grower groups learning Queensland Mr Andrew Lashmar $10,000 from the successful established Birchip Department of Cropping Group Primary Industries & Fisheries ABC002 Developing a learning culture within ABC. Advanced Mr Bryan Granshaw $7,590 Burdekin Collective Research Inc ABC003 Grower Innovation Virtual Expo Advanced Mr Andrew Lashmar $6,618 Burdekin Collective Research Inc ABC004 A learning experience to adopt overlap Advanced Mr Joe Linton $7,000 cropping of beans and cane Burdekin Collective Research Inc

120 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Project Title Lead Organisation Research Contact Funds AFF001 Corporate governance for rural women Australian Dr Tracy Henderson $4,128 Government Department of Agriculture, Fisheries and Forestry BSS275 Enhancing capacity of the Bundaberg BSES Limited Ms Palmina $1,000 women in sugar group – Contrasting Bonaventura sugar and cotton BSS280 Overseas sugarcane quarantine and BSES Limited Dr Mohamed $4,250 emergency response planning Sallam BSS281 To enhance the capacity for whole of BSES Limited Mr Lawrence $2,000 system change in the Herbert Sugar DiBella Industry by taking selected leaders on a study tour of Southern Africa. BSS282 Farming systems tour for the Herbert BSES Limited Mr Mark Poggio $1,320 Sugar Industry BSS283 Presentation of BMP variety workshops BSES Limited Mr Tony Linedale $1,375 BSS284 Building capacity for grower group BSES Limited Mr Joe Muscat $1,180 coordinators in the Mackay region BSS285 Building capacity of group members of BSES Limited Mr Joe Muscat $1,000 the Mackay Fibre Producers in a fibre- production value chain BSS287 Enhancing grower groups in the BSES Limited Mr Robert Sluggett $44,190 Australian sugar industry BSS288 Bus tour for Bundaberg and Rocky Point BSES Limited Mr Barry Callow $6,724 growers to contrast grain and sugar industry group dynamics BSS289 Everything you wanted to know about BSES Limited Mr Drew Burgess $6,720 cane payment but were too afraid to ask – information workshops for female business partners in the sugar industry 7 BSS291 Travel for keynote speakers to attend the BSES Limited Mr Lawrence $3,500 Queensland Best Practice Harvesting DiBella workshops BSS292 Investigating marketing strategies and BSES Limited Mr Joe Muscat $8,000 alternative cropping by the Mackay District Young Farmers Group

ANNUAL REPORT 2005–2006 121 Project Title Lead Organisation Research Contact Funds BSS293 Mackay district grower group leaders BSES Limited Mr Joe Muscat $4,500 and young farmers attendance at 2006 ASSCT Conference CG007 The Tully Sugar Industry Project – CANEGROWERS Mr Peter Lucy $12,750 “Working together for our Future” Phase 2 CG008 Targeted Planning for Profit: A grass CANEGROWERS Ms Judy Skilton $67,344 roots program to build grower skills to manage change and implement integrated future planning CG010 Field trip to the Emerald cotton CANEGROWERS Mr Matt McNee $410 farming region to inform cane growers & professionals with regard to Farm Management Systems (FMS) CG011 A Changing Future: Enhancing grower CANEGROWERS Ms Judy Skilton $0 skills and confidence to respond to industry restructure in the Isis and Maryborough Districts CG012 A review of voluntary, market based & CANEGROWERS Dr Tim Wrigley $2,000 statutory based instruments used in conjunction with the farming community in Chesapeake Bay catchment, USA. CG014 Enhancing the Isis women in sugar CANEGROWERS Ms Nicole Kirk $3,200 group’s knowledge and capacity to Isis address industry issues CG015 Enhancing the knowledge of the CANEGROWERS Mr Allan Dingle $5,500 CANEGROWERS Grain in Cane group – Investigating other Grain in Cane enterprises CG016 Improving Linkages – A combined CANEGROWERS Mrs Ann Jansen $10,000 approach to increase capacity of women Bundaberg in the sugar industry CG017 Northern NSW cane harvesting visit CANEGROWERS Mr Wayne Stanley $6,700 Isis CGB001 Enhancing capacity of Bundaberg & Isis CANEGROWERS Mrs Coral Zunker $9,960 Women in Sugar groups in Integrated Bundaberg Pest Management – focussing on rotational legume break crops

122 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Project Title Lead Organisation Research Contact Funds CHC001 Facilitated workshop to review Clarence Mr Peter Rose $4,000 management and communication Harvesting options between harvesters and the Mill Cooperative CMC001 CANEGROWERS’ strategy for women Catherine Ms Cathy $10,000 and teams McGowan McGowan Consulting CSE016 Sugar communities and resilience to CSIRO Sustainable Dr Emma Jakku $42,595 change: Opportunities for enhancing Ecosystems women’s participation in sustainability initiatives CSR029 Building capacity to lead and implement CSR Sugar Mr Greg Livingstone $50,000 regional transformation in the sugar industry CSR030 Herbert cultural imprint analysis – A CSR Sugar Mr Gavin Hughes $66,369 pathway to greater understanding and co-operation in decision making CSR032 Learning lessons from extension CSR Sugar Dr Lisa McDonald $10,000 programs for improved environmental management farming practices in Florida and harvesting research in Argentina CSR035 Soils and irrigation workshops – training CSR Sugar Dr Lisa McDonald $6,500 for farmers and trainers CSR036 Attendance at the 4th EMS conference, CSR Sugar Dr Lisa McDonald $8,100 October 2005 CSR037 Improving the skills of CPI facilitators to CSR Sugar Dr Lisa McDonald $8,000 interact with grower groups DHC001 Innovating and Developing Human Rural Industries Dr Tracy Henderson $40,000 Capacity in Rural Industries (joint RDC Research & program) Development Corporation DPI016 Investigating trade and market Queensland Mr Andrew Lashmar $9,907 opportunities with Indonesia by Department of 7 capitalising on grain soybean crops Primary Industries within sugar cane farming systems in the & Fisheries Burdekin DPI017 Improving on-farm research in the Queensland Mr Andrew Lashmar $9,900 Burdekin and Herbert sugar regions Department of Primary Industries & Fisheries

ANNUAL REPORT 2005–2006 123 Project Title Lead Organisation Research Contact Funds DPI018 FNQ grower farming systems tour of Queensland Mr Terry Reid $8,000 Southern Qld & Northern NSW Department of Primary Industries & Fisheries FMS003 Farm Management Systems for the AGRECON Mr Simon Holloway $337,455 Sugarcane Industry, Sub-program 3: FMS training course FMS006 Travel to WWF Sugar Dialogue meeting Canefarmer/ Mr Robert Quirk $0 and South African sugar industry for Canefarm learning about other experiences of FMS GGP002 Development of an integrated wallaby Barron Delta Mr Mick Andrejic $0 management strategy Farming Group IBS001 How are Herbert and Burdekin growers Innisfail Babinda Mr George Bugeja $0 dealing with low sugar prices – A study Cane Productivity tour for Innisfail Babinda growers Services Ltd IBS003 Innisfail/Babinda harvester contractors Innisfail Babinda Mr Bill Horsford $1,772 travel to the Herbert Cane Productivity Services Ltd JCU026 The IPO – signal or noise? James Cook Dr Yvette $5,000 University Everingham LDI001 Developing the leadership capacity of the Leading Industries Ms Cheryl Phillips $86,000 Australian Sugar Industry MAS003 Mossman representatives participating Mossman Mr Daryl Parker $4,210 in the 2006 APEN and ASSCT Agricultural Conferences Services NSC010 Bringing together innovative farmers from New South Wales Mr Rick Beattie $2,500 NSW and the Central Region Sugar Milling Co-operative Ltd NSC011 Bringing together innovative engineers New South Wales Mr David Moller $3,500 from the NSW and Northern/Central Sugar Milling regions Co-operative Ltd ORC001 Development of a marketing strategy Ord River Mr Paul Mock $3,940 and reporting mechanism for Ord River Canegrowers Canegrowers Association Pricing Committee PCS001 Harvesting rationalisation learning Plane Creek Mrs Sarah Miotto $1,088 expedition Productivity Services Ltd.

124 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Project Title Lead Organisation Research Contact Funds QUT009 Workshops for sugar factory staff to Queensland Dr Ross Broadfoot $5,000 explore opportunities for increased University of revenues, efficiencies and reduced Technology operational and maintenance costs RDA002 Grower Group Awards Sugar Research Dr Robert Troedson $100,000 and Development Corporation RDA004 Regional Innovation Awards Sugar Research Dr Tracy Henderson $200 and Development Corporation REL001 Building grower capacity in steps Roberts Evaluation Dr Kate Roberts $15,000 Pty Ltd SRD008 Travel to ASSCT conference at Mackay Canefarmer/ George & Kathy $1,455 by George and Kathy Henry Canefarm Henry SRD009 Travel to ASSCT conference at Mackay Sugar Cane Mr Neville Loeskow $1,300 by Neville Loeskow Farmer SRL001 Travel to Southern Africa to inspect Sugar Research Dr Bryan Lavarack $4,920 value-adding opportunities Limited TCG001 Development of a 2m x 800mm cane G J Deguara Mr Gerry Deguara $4,200 configuration base cutter box Family Trust TCG002 Tropical City Group Forum #3 – Ayr, Sugar Cane Mr Dick Camilleri $10,000 November 2005 Farmer TCS001 Tully sugar industry representatives Tully Cane Mr Dick Camilleri $10,000 travelling to the third Australian Productivity Conference on Controlled Traffic Farming Services Ltd Program D Industry Capacity Strategy Targeted continuing education AFF002 Science and Innovation Awards for Australian Dr Tracy Henderson $14,000 Young People Government Department of Agriculture, Fisheries and 7 Forestry AU002 Participate in the international conference Adelaide University Ms Katherine $3,600 on lepidopterous stemborers Muirhead BSS274 Sugarcane-oriented quarantine training BSES Limited Dr Mohamed $1,000 program Sallam BSS279 Improving extension capacity BSES Limited Mr Dale Chapple $4,000

ANNUAL REPORT 2005–2006 125 Project Title Lead Organisation Research Contact Funds CPI010 Accessing international expertise in CSIRO Plant Dr John Manners $8,000 sugarcane biotechnology Industry CPI011 Participation in Plant and Animal CSIRO Plant Dr Rosanne Casu $2,455 Genome XIV Conference Industry CSE015 Nitrogen management controls in the CSIRO Sustainable Dr Peter Thorburn $4,770 EU and USA – Lessons for the Australian Ecosystems sugar industry CSR034 Travel to attend Social Ecology CSR Sugar Dr Lisa McDonald $1,436 residential school at Hawksbury QUT003 An integrated pest management Queensland Dr Susan Fuller $46,044 strategy for climbing rat in the far-north University of Queensland sugarcane production Technology system QUT006 The 2006 Appita Conference – value Queensland Mr Tom Rainey $3,295 adding of bagasse University of Technology QUT007 The PACIFICHEM 2005 Conference Queensland Dr William Doherty $7,212 – Diversification through value-added University of products Technology SRD003 Generation Next Forum Sugar Research Dr Tracy Henderson $43,057 and Development Corporation STU041 C Ngo – Molecular analysis of suckering The University of Dr Christine $12,000 and tillering in sugarcane Queensland Beveridge STU042 K Ritter – An investigation of the genetic, The University of Dr Ian Godwin $4,833 biochemical and molecular basis of Queensland sugar accumulation in sugarcane STU048 M James – Application of engineering Queensland Dr Duncan $0 principles and computer modelling skills University of Campbell to harvester design Technology STU049 P Wulf – Self-regulatory codes of The University of Prof Geoff $5,000 practice & their effectiveness in achieving Queensland McDonald best environmental management practices within NQ primary industries STU050 Mira Durr – Microbiology of acid sulfate Sugar Research Prof Ian White $32,000 soils in agricultural environments and Development Corporation

126 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Project Title Lead Organisation Research Contact Funds STU052 Kylie Anderson – Invasion potential of Sugar Research Dr Bradley $22,865 Eumetopina flavipes, vector of Ramu and Development Congdon Stunt Disease of Sugarcane Corporation STU053 Su Yin Tan – Studies on bagass Sugar Research Prof Doug $32,000 fractionation using ionic liquids Institute MacFarlane STU055 Karen Benn – The motivators and James Cook Dr Janice Elder $15,750 barriers to the adoption of more University sustainable farming practices STU056 Kenji Osabe – Development and The University of Dr Robert Birch $16,000 application of a mature stem specific Queensland promoter in sugarcane STU057 Tom Rainey – Improved bagasse fibre Queensland Dr William Doherty $26,000 properties for the manufacture of paper, University of board and composite materials Technology STU058 Jane Churchill – Rapid screening tools Queensland Dr Serge Kokot $16,000 for smut reaction in sugarcane varieties University of Technology STU059 Anna Satje – Improving the cation James Cook Dr Paul Nelson $18,625 retention capacity of cane-growing soils University using high activity clays WS013 Project design and evaluation workshops Sugar Research Dr Tracy Henderson $5,194 and Development Corporation Program D Industry Capacity Strategy Promoting safe healthy workplaces OHS002 Farm Health and Safety R&D Program Sugar Research Dr Les Robertson $20,000 2002–2006 and Development Corporation Program D Industry Capacity Strategy More effective coordination of R&D activities FMS005 FMS program 5. Evaluation of FMS CSR Sugar Dr Lisa McDonald $14,409 7 GGP001 Group Innovation projects liaison and Sugar Research Dr Tracy Henderson $29,705 support and Development Corporation RDA001 Innovator and R&D Awards Sugar Research Dr Tracy Henderson $33,162 and Development Corporation

ANNUAL REPORT 2005–2006 127 Project Title Lead Organisation Research Contact Funds SRD006 GGIP Workshop Sugar Research $7,787 and Development Corporation SRD007 Benefit:Cost Analysis of selected SRDC Sugar Research Dr Robert Troedson $15,000 funded projects and Development Corporation WS009 Assessment of regional R&D needs and Sugar Research Dr Tracy Henderson $67,670 opportunities and Development Corporation

128 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Appendix B

Final Reports Approved (2005–06)

Prog. Project No. Title Company Research Contact A BSS261 Measurement and feedback systems for BSES Limited Mr Trevor Willcox improving market signals for harvesting A CSE004 Improving yield forecasting capability CSIRO Sustainable Dr Yvette to enhance market strategies for the Ecosystems Everingham Australian sugar industry A CSE005 Integrating and optimising farm-to-mill CSIRO Sustainable Dr Andrew Higgins decisions to maximise industry profitability Ecosystems A CSE010 Integrated value chain scenarios for CSIRO Sustainable Dr Peter Thorburn enhanced mill region profitability Ecosystems A CSE013 Increasing the capacity to identify CSIRO Sustainable Dr Andrew Higgins and action value chain integration Ecosystems opportunities A MSA003 A cooperative systems model for the Mackay Sugar Mr Geoff Fleming Mackay regional sugar industry Cooperative Association Ltd A SRD001 Cane harvesting to improve industry Sugar Research Dr Les Robertson performance and Development Corporation A SRD004 Value Chain Workshop Sugar Research Dr Tracy and Development Henderson Corporation B BSS151 Resistance mechanisms and selection BSES Limited Dr Nils Berding for resistance in sugarcane to sugarcane weevil borer B BSS197 Products and mechanisms for BSES Limited Mr Gary Ham amelioration of sodic soils B BSS250 Improving selection systems and data BSES Limited Dr Xianming Wei analysis in sugarcane breeding programs B BSS255 Improving the plant breeding selection BSES Limited Mr Barry Croft system for Fiji disease resistance 7 B BSS258 Assessing the impact that pathogen BSES Limited Mr Kathy variation has on the sugarcane breeding Braithwaite program B BSS260 Enhanced delivery of PROSPER to BSES Limited Mr Eoin Wallis achieve adoption of Best Management Practices in the Queensland sugar industry

ANNUAL REPORT 2005–2006 129 Prog. Project No. Title Company Research Contact B CPI005 Adapting soybean for profitable rotations CSIRO Plant Dr Andrew James in sugarcane farming systems Industry B CSE001 Increased profitability and water use CSIRO Sustainable Dr Geoff Inman- efficiency through best use of limited Ecosystems Bamber water under supplementary irrigation B FMS001 Farm Management Systems for the Sugar AGRECON Mr Don Chambers Cane Industry, Sub-program 1: Interactive web-based material to support FMS B FMS002 Farm Management Systems for the AGRECON Mr Don Chambers Sugarcane Industry, Sub-program 2: Environmental and economic performance indicators B FMS007 Land and Water Management Plan AGRECON Mr Simon Holloway drafting tools for the FMS framework B JCU016 Quantification of effects of cane field James Cook Prof Richard drainage on stream ecology University Pearson B JCU024 Water quality and unexplained fish James Cook Prof Richard kills in sugarcane districts of northern University Pearson Queensland B NA003 Hydrologic effects of flood gate New South Wales Dr Peter Slavich management on coastal floodplain Agriculture agriculture – the sugarcane component B NSC008 Setting productivity and cost savings New South Wales Mr Rick Beattie targets for the NSW sugar industry Sugar Milling Co- operative Ltd B ORD001 Introduction of existing new varieties CSR Sugar Dr Andrew Wood B ORD002 Ord sugar industry pathology services CSR Sugar Dr Andrew Wood B ORD003 Ord sugar industry extension services CSR Sugar Dr Andrew Wood B SRD002 Case studies of improved economic Sugar Research Dr Les Robertson performance from implementing and Development innovations on farms. Corporation B UQ011 Increased yield and sugar accumulation The University of Dr Robert Birch by the reduction of respiratory loss Queensland B UQ039 Gene control sequences for metabolic The University of Dr Robert Birch engineering in sugarcane Queensland C HGP002 Design and build a moving wall on side Pacific Cane Mr Mark North tipping cane transporters Harvesting

130 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Prog. Project No. Title Company Research Contact C SRI049 Aerodynamic optimisation of extraction Sugar Research Dr Phil Hobson chambers for high pour-rate pneumatic Institute cane cleaning devices C SRI053 Upgrading dry dust collectors to wet Sugar Research Mr Rod Steindl operation Institute C SRI107 Improved transfer to mills of technology Sugar Research Mr John Kenny developed by the Sugar Research Institute Institute C SRI122 The functional relationship between juice Sugar Research Dr Ross Broadfoot properties, operating conditions and heat Institute transfer in Roberts evaporators D ABC001 Sugarcane grower groups learning Queensland Mr Andrew from the successful established Birchip Department of Lashmar Cropping Group Primary Industries & Fisheries D ABC002 Developing a learning culture within ABC Advanced Burdekin Mr Bryan Collective Research Granshaw Inc D BSS274 Sugarcane-oriented quarantine training BSES Limited Dr Mohamed program Sallam D BSS280 Overseas sugarcane quarantine and BSES Limited Dr Mohamed emergency response planning Sallam D BSS281 To enhance the capacity for whole of BSES Limited Mr Lawrence system change in the Herbert Sugar DiBella Industry by taking selected leaders on a study tour of Southern Africa. D BSS282 Farming systems tour for the Herbert BSES Limited Mr Mark Poggio Sugar Industry D BSS284 Building capacity for grower group BSES Limited Mr Joe Muscat coordinators in the Mackay region D BSS285 Building capacity of group members of BSES Limited Mr Joe Muscat the Mackay Fibre Producers in a fibre- production value chain 7 D BSS288 Bus tour for Bundaberg and Rocky Point BSES Limited Mr Barry Callow growers to contrast grain and sugar industry group dynamics D CG007 The Tully Sugar Industry Project – CANEGROWERS Mr Peter Lucy “Working together for our Future” Phase 2

ANNUAL REPORT 2005–2006 131 Prog. Project No. Title Company Research Contact D CG010 Field trip to the Emerald cotton CANEGROWERS Mr Matt McNee farming region to inform cane growers & professionals with regard to Farm Management Systems (FMS) D CG011 A Changing Future: Enhancing grower CANEGROWERS Ms Judy Skilton skills and confidence to respond to industry restructure in the Isis and Maryborough Districts D CG012 A review of voluntary, market based & CANEGROWERS Dr Tim Wrigley statutory based instruments used in conjunction with the farming community in Chesapeake Bay catchment, USA. D CG016 Improving Linkages – A combined CANEGROWERS Mrs Ann Jansen approach to increase capacity of women Bundaberg in the sugar industry D CG017 Northern NSW cane harvesting visit CANEGROWERS Mr Wayne Stanley Isis D CGB001 Enhancing capacity of Bundaberg & Isis CANEGROWERS Mrs Coral Zunker Women in Sugar groups in Integrated Bundaberg Pest Management – focussing on rotational legume break crops D CHC001 Facilitated workshop to review Clarence Mr Peter Rose management and communication options Harvesting between harvesters and the Mill Cooperative D CPI011 Participation in Plant and Animal Genome CSIRO Plant Dr Rosanne Casu XIV Conference Industry D CSR029 Building capacity to lead and implement CSR Sugar Mr Greg regional transformation in the sugar Livingstone industry D CSR032 Learning lessons from extension programs CSR Sugar Dr Lisa McDonald for improved environmental management farming practices in Florida and harvesting research in Argentina D CSR034 Travel to attend Social Ecology residential CSR Sugar Dr Lisa McDonald school at Hawksbury D CSR036 Attendance at the 4th EMS conference, CSR Sugar Dr Lisa McDonald October 2005

132 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Prog. Project No. Title Company Research Contact D DPI016 Investigating trade and market Queensland Mr Andrew opportunities with Indonesia by Department of Lashmar capitalising on grain soybean crops Primary Industries within sugar cane farming systems in the & Fisheries Burdekin D DPI017 Improving on-farm research in the Queensland Mr Andrew Burdekin and Herbert sugar regions Department of Lashmar Primary Industries & Fisheries D FMS006 Travel to WWF Sugar Dialogue meeting Sugarcane Farmer Mr Robert Quirk and South African sugar industry for learning about other experiences of FMS D IBS001 How are Herbert and Burdekin growers Innisfail Babinda Mr George Bugeja dealing with low sugar prices – A study Cane Productivity tour for Innisfail Babinda growers Services Ltd D IBS003 Innisfail/Babinda harvester contractors Innisfail Babinda Mr Bill Horsford travel to the Herbert Cane Productivity Services Ltd D JCU026 The IPO – signal or noise? James Cook Dr Yvette University Everingham D NSC010 Bringing together innovative farmers from New South Wales Mr Rick Beattie NSW and the Central Region Sugar Milling Co- operative Ltd D NSC011 Bringing together innovative engineers New South Wales Mr David Moller from the NSW and Northern/Central Sugar Milling Co- regions operative Ltd D ORC001 Development of a marketing strategy Ord River Mr Paul Mock and reporting mechanism for Ord River Canegrowers Canegrowers Association Pricing Committee D QUT006 The 2006 Appita Conference – value Queensland Mr Tom Rainey adding of bagasse University of 7 Technology D QUT007 The PACIFICHEM 2005 Conference Queensland Dr William Doherty – Diversification through value-added University of products Technology D QUT009 Workshops for sugar factory staff to Queensland Dr Ross Broadfoot explore opportunities for increased University of revenues, efficiencies and reduced Technology operational and maintenance costs

ANNUAL REPORT 2005–2006 133 Prog. Project No. Title Company Research Contact D SRD007 Benefit:Cost Analysis of selected SRDC Sugar Research Dr Robert Troedson funded projects and Development Corporation D SRD008 Travel to ASSCT conference at Mackay by Sugarcane Farmer George & Kathy George and Kathy Henry Henry D SRL001 Travel to Southern Africa to inspect value- Sugar Research Dr Bryan Lavarack adding opportunities Limited D STU032 K Nutt – Proteinase inhibitors from BSES Limited Dr Peter Allsopp canegrubs D STU033 D Ward – Strategic baiting protocols for Queensland Dr John Wilson rodents in sugarcane University of (decd.) Technology D STU048 M James – Application of engineering Queensland Dr Duncan principles and computer modelling skills to University of Campbell harvester design Technology D TCG002 Tropical City Group Forum #3 – Ayr, Sugarcane Farmer Mr Dick Camilleri November 2005 D TCS001 Tully sugar industry representatives Tully Cane Mr Dick Camilleri travelling to the third Australian Productivity Conference on Controlled Traffic Farming Services Ltd D WS013 Project design and evaluation workshops Sugar Research Dr Tracy and Development Henderson Corporation

134 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Appendix C

Published Papers

Journal papers ANTONY A., PRESTWIDGE D., SANDELL G., ARCHER A., THORBURN P. AND HIGGINS A. (2005). Towards farming-systems change from value-chain optimization in the Australian sugar industry. Australian Farm Business Management Journal, 2: 1–9.

ANTONY, G., PRESTWIDGE, D., SANDELL, G., ARCHER, A., THORBURN, P. & HIGGINS, A.J. (2005) Towards farming-systems change from value-chain optimisation in the Australian sugar industry. Australian Farm Business Management Journal, 2, 1–9.

ANTONY, G., PRESTWIDGE, D., SANDELL, G., ARCHER, A., THORBURN, P. & HIGGINS, A.J. (2005) Towards farming-systems change from value-chain optimisation in the Australian sugar industry. Australian Farm Business Management Journal, 2, 1–9.

ARCHER A.A., HIGGINS A.J. AND THORBURN P.J. (2006). Some key issues to successfully supporting strategic change in agricultural commodity supply chains. In: Proc. 7th International Conference on Management in AgriFood Chains and Networks, Ede, The Netherlands, 2 pp (on CD).

HIGGINS, A. & DAVIES, I. (2005) A simulation model for capacity planning in sugarcane transport. Computers and Electronics in Agriculture, 47, 85–102.

HIGGINS, A. & DAVIES, I. (2005) A simulation model for capacity planning in sugarcane transport. Computers and Electronics in Agriculture, 47, 85–102.

HIGGINS, A., ANTONY, G., SANDELL, G., DAVIES, I., PRESTWIDGE, D. & ANDREW, B. (2004) A framework for integrating a complex harvesting and transport system for sugar production. Agricultural Systems, 82, 99–115.

HIGGINS, A., ANTONY, G., SANDELL, G., DAVIES, I., PRESTWIDGE, D. & ANDREW, B. (2004) A framework for integrating a complex harvesting and transport system for sugar production. Agricultural Systems, 82, 99–115.

HIGGINS, A.J. & DAVIES, I. (2004) Capacity planning in a sugarcane harvesting and transport system using simulation modeling. Proc. Aust. Soc. Sugar Cane Technol., Vol. 26 (CD).

HIGGINS, A.J. & DAVIES, I. (2004) Capacity planning in a sugarcane harvesting and transport system using simulation modeling. Proc. Aust. Soc. Sugar Cane Technol., Vol. 26 (CD).

HIGGINS, A.J. & DOWNS, P. (2005) Optimal scheduling of road vehicles in the Maryborough sugarcane transport system. Proc. Aust. Soc. Sugar Cane Technol., Vol. 27, pp. 32–39.

HIGGINS, A.J. & DOWNS, P. (2005) Optimal scheduling of road vehicles in the Maryborough sugarcane transport system. Proc. Aust. Soc. Sugar Cane Technol., Vol. 27, pp. 32–39. 7 HIGGINS, A.J. & LAREDO, L. (2006) Improving harvest and transport planning within a sugar mill region. Journal of the Operational Research Society, 57, 367–376.

MEIER E.A., THORBURN P.J. AND PROBERT M.E. (2006). Occurrence and simulation of nitrification in two contrasting sugarcane soils from the Australian wet tropics. Australian Journal of Soil Research, 44: 1–9.

MEIER E.A., THORBURN P.J., WEGENER M.K. AND BASFORD K.E. (2006). The availability of nitrogen from sugarcane trash on contrasting soils in the wet tropics of North Queensland. Nutrient Cycling in Agroecosystems, in press.

ANNUAL REPORT 2005–2006 135 RIDLEY, A.W., DHILEEPAN, K., JOHNSON, K.N., ALLSOPP, P.G., NUTT, K.A., WALTER, G.H. AND CROFT, B.J. (2006) Is the distribution of Fiji leaf gall in Australia explained by variation in the vector Perkinsiella saccharicida? Australasian Plant Pathology 35: 103–112

RIDLEY, A.W., DHILEEPAN, K., JOHNSON, K.N., ALLSOPP, P.G., NUTT, K.A., WALTER, G.H. AND CROFT, B.J. (2006) Is the distribution of Fiji leaf gall in Australia explained by variation in the vector Perkinsiella saccharicida? Australasian Plant Pathology 35: 103–112

SANDELL, G.R. AND PRESTWIDGE, D.B. (2004) Harvest Haul Model — the cost of Harvesting paddocks of sugarcane across a sugar milling region. Proc. Aust. Soc. Sugar Cane Technol., Vol. 27 (CD).

THORBURN P.J., ARCHER A.A., HOBSON P.A., HIGGINS A.J., SANDELL G.R., PRESTWIDGE D.B., ANTONY G. (2006). Evaluating diversification options for sugar supply chains: whole crop harvesting to maximize co-generation. In: Proc. 7th International Conference on Management in AgriFood Chains and Networks, Ede, The Netherlands, 12 pp (on CD).

THORBURN P.J., DAWES L., KEMEI J., CHARLESWORTH P., ATTARD S.J. AND CAIRNS, R. (2006). Losses of farm chemicals from fully irrigated sugarcane systems in Australia. Proceedings of the 2006 International Society of Sugar Cane Technologists Agronomy Workshop, May 2006 Khon Kaen, Thailand p 35.

Proceedings of the Australian Sugar Cane Technologists 2006 Papers AITKEN, K.S., LI, J-C. and JACKSON, P. (2006). Using molecular markers to introgress traits from related wild species into sugarcane. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 187–195.

BLAIR, B.L. and STIRLING, G.R. (2006). The role of sett roots and shoot roots in the establishment of sugarcane planted into yield decline soils. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 367–378.

BROADFOOT, R. (2006). Costs and benefits of the CBA boiling scheme for high pol sugar production. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 581–591.

DENMEAD, O.T., MACDONALD, B.C.T., BRYANT, G., WANG, I., WHITE, W., MOODY, P., DALAL, R.C. and STAINLAY, W. (2006). Greenhouse gas emissions from sugarcane soils and nitrogen fertiliser management. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 252–260.

EVERINGHAM, Y., JAKKU, E., INMAN-BAMBER, G., THORBURN, P., WEBSTER, T., ATTARD, S. and ANTONY, G. (2006). Understanding the adoption of knowledge intensive technologies in the Australian sugar industry–a pilot study. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 76–85.

GARSIDE, A.L., BERTHELSEN, J.E., ROBOTHAM, B.G. and BELL, M.J. (2006). Management of the interface between sugarcane cycles in a permanent bed, controlled traffic farming system. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 118–128.

GARSIDE, A.L., BERTHELSEN, J.E., ROBOTHAM, B.G. and BERDING, N. (2006). Row spacing effects on the growth and yield of several sugarcane varieties in north Queensland. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 298–308.

GOMEZ, J., CHAPPLE, D. and McDONALD, L. (2006). Sugar losses in burnt and green cane harvesting in Argentina. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 291–297.

HAINES, M.G. and LINEDALE, A.I. (2006). Impact of a sustained water use efficiency program in the Bundaberg district. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 173–180.

136 SUGAR RESEARCH AND DEVELOPMENT CORPORATION HIGGINS, A., ARCHER, A., THORBURN, P. and JAKKU, E. (2006). Value chain research in sugar–lessons from the past and opportunities for the future. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 28–36.

HIGGINS, A.J., PRESTWIDGE, D., LAREDO, L. AND SANDELL, G. (2006). An integrated harvesting and transport supply chain model. Proceedings of the 28th Australian Society Sugar Cane Technologists, Mackay, pp. 606–607.

HORSFIELD, A., RATTEY, A.R. and ALLSOPP, P.G. (2006). Resistance components in Burdekin sugarcane varieties to damage by greyback canegrubs Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 207–218.

INMAN-BAMBER, N.G., WEBB, W.A. and VERRALL, S.A. (2006). Participatory irrigation research and scheduling in the Ord: R&D. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 155–163.

MAGAREY, R.C., FINLAYSON, W.A. and BULL, J.I. (2006). Developments in chlorotic streak resistance screening. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 336–344.

McDONALD, L. (2006). The effect of time of ratooning on sugarcane growth in the Burdekin. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 261–272.

PRESTWIDGE, D., LAMB, B., HIGGINS, A., SANDELL, G. and BEATTIE, R. (2006). Optimising the number and location of new cane delivery pads in the NSW sugar region. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 86–95.

QUIRK, R.G. (2006). Environmental management systems and farm management systems from a global perspective and links to the Better Sugarcane Initiative. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 113–117.

RACKEMANN, D.W., RAINEY, T.J., BROADFOOT, R. and PIKE, D. (2006). Performance of an improved pan stirrer at Isis sugar mill. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 569–580.

SCHROEDER, B.L., WOOD, A.W., MOODY, P.W., PANITZ, J.H., AGNEW, J.R., SLUGGETT, R.J. and SALTER, B. (2006). Delivering nutrient management guidelines to growers in the central region of the Australian sugar industry. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 142–154.

STEINDL, R.J. and LAVARACK, B.P. (2006). Mud thickening in SRI clarifiers. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 496–506.

STIRLING, G. (2006). Susceptibility of sugarcane varieties to two species of root-knot nematode (Meloidogyne javanica and M. incognita), and implications for crops grown in rotation with sugarcane Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 345–350.

THORBURN, P.J., ARCHER, A.A., HOBSON, P.A., HIGGINS, A.J., SANDELL, G.R., PRESTWIDGE, D.B., ANDREW, B., ANTONY, G., McDONALD, L.M., DOWNS, P. and JUFFS, R. (2006). Value chain analyses of whole crop harvesting to maximise co-generation. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 37–48. THORBURN P.J., DAWES L., KEMEI J., CHARLESWORTH P., ATTARD S.J. AND CAIRNS, R. (2006). Sustainable 7 irrigation in the Burdekin: Losses of farm chemicals in runoff and deep drainage. Proceedings of the Australian Society of Sugar Cane Technologists 28: 598.

THORBURN P.J., WEBSTER A.J., BIGGS I.M., BIGGS J.S., PARK S.E. AND SPILLMAN M.F. (2006). Innovative management of nitrogen fertiliser: Testing the replacement concept. Proceedings of the Australian Society of Sugar Cane Technologists 28: 599.

WEBB, W.A., INMAN-BAMBER, N.G. and MOCK, P. (2006). Participatory irrigation research and scheduling in the Ord: Extension. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 164–172.

ANNUAL REPORT 2005–2006 137 WEI, X., JACKSON, P., COX, M. and STRINGER, J. (2006). Maximising economic benefits to the whole sugarcane industry from the BSES–CSIRO sugarcane improvement program. Proc. Aust. Soc. Sugar Cane Technol., Vol. 28: 181–186.

SRDC Technical Publications The Value Chain of the Australian Sugar Industry: SRDC Technical Report 1/2006

SRDC Statutory Publications • SRDC Annual Report 2005–06 (and supplementary CDROM); • SRDC Annual Operational Plan 2005–06; and • SRDC R&D Plan 2003–2008.

SRDC General Publications SRDC issues a range of publications electronically, either through the SRDC website or directly to a subscribers list.

Electronic publications include: • SRDC Update – six issues a year, SRDC Update also appears in various industry publications (August, October and December 2005, February, April and June 2006); • eNews – a monthly update sent via a subscription list (editions 1 – 13); • media releases – issued regularly.

Other publications include: SRDC Corporate Brochure

138 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Appendix D

Freedom of Information Act Statement

Organisation The role, structure and functions of SRDC, including details of the Directors and staff, are outlined in Section 5 of this Annual Report (Report of Corporate Operations).

The Corporation is accountable to the Australian Government through the Parliamentary Secretary to the Minister for Agriculture, Fisheries and Forestry, and to the three Representative Bodies prescribed through SRDC’s governing legislation, the PIERD Act:

• Australian Cane Growers’ Council • Australian Cane Farmers Association • Australian Sugar Milling Council Proprietary Limited.

Categories of documents The following documents are available on request from SRDC’s Brisbane office and/or may be downloaded from the SRDC website www.srdc.gov.au: Annual Operational Plan, Annual Report, Research and Development Plan, Technical Reports, Newsletters (SRDC Update). The following documents and files may be downloaded from the SRDC website: Proposal Forms and Application Kits for Research Projects, Scholarships, and Travel and Learning Opportunity Projects. Other files and documents are not customarily made available and are subject to assessment of access for reasons including commercial confidentiality or personal privacy.

FOI statistics 2005–06 FOI requests received Nil Internal review received Nil Fees/charges levied Nil Fees/charges collected Nil AAT appeals Nil AAT decisions Nil

FOI procedures Enquiries about access to documents or other matters relating to FOI should be directed to the FOI Contact Officer between 9.00am and 5.00pm, Monday to Friday. 7 The FOI contact officer is:

The Executive Director Sugar Research and Development Corporation Level 16 141 Queen Street Brisbane Qld 4000. Telephone: (07) 3210 0495 Facsimile: (07) 3210 0506 Email: [email protected]

ANNUAL REPORT 2005–2006 139

Appendix E

Abbreviations

ACFA Australian Cane Farmers’ Association ACGC Australian Cane Growers’ Council ASSCT Australian Society of Sugarcane Technologists DAFF Australian Government Department of Agriculture Fisheries and Forestry DAFWA Department of Agriculture and Food, Western Australia AOP Annual Operational Plan ASMC Australian Sugar Milling Council Proprietary Limited ASSCT Australian Society of Sugar Cane Technologists BPMS Business Process Management System BSES BSES Limited (formerly known as Bureau of Sugar Experiment Stations) CAC Act Commonwealth Authorities and Companies Act 1997 CCS Commercial Cane Sugar CPPB Cane Protection and Productivity Board CP2002 Cross Program Activity CP2002 CRC Cooperative Research Centre CRCSIIB Cooperative Research Centre for Sugar Industry Innovation through Innovation CSIRO Commonwealth Scientific and Industrial Research Organisation FEAT Farm Economics Assessment Tool FMS Farm Management Systems GGIP Grower Group Innovation Project GIS Geographical Information System GPS Global Positioning Service GVP Gross Value of Production (of sugarcane) HGIP Harvester Group Innovation Project IGG Industry Guidance Group IHP International High Pol IP Intellectual Property IPM Integrated Pest Management ISSCT International Society of Sugar cane Technologists 7 JCU James Cook University LWA Land and Water Australia (formerly LWRRDC) MCV(P) Managing Climate Variability (Program) NSW New South Wales NSWSMC New South Wales Sugar Milling Cooperative OH&S Occupational Health and Safety

ANNUAL REPORT 2005–2006 141 ORIA Ord River Irrigation Area PBS Portfolio Budget Statement PIERD Act Primary Industries and Energy Research and Development Act 1989 QDPI&F Queensland Department of Primary Industries and Fisheries QDNRM Queensland Department of Natural Resources and Mines QHP Queensland High Pol QSL Queensland Sugar Limited QUT Queensland University of Technology R&D Research and Development RDC Research and Development Corporations RIRDC Rural Industries Research and Development Corporation SRDC Sugar Research and Development Corporation SRI@QUT Sugar Research Institute at Queensland University of Technology SYDJV Sugar Yield Decline Joint Venture TLOP Travel and Learning Opportunity Project UQ University of Queensland WIS Women in Sugar

142 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Appendix F

Table of Compliance with Publishing Guidelines and Legislation

Page Annual Operational Plan 64 Audit Committee 72 Auditor General’s Certificate 80 Board Committees 72 Board Meetings 71 Australian Government Disability Strategy 77 Chair and Executive Director’s Report 17 Corporate Governance 65 Directors 68 Enabling Legislation 63 Ecologically Sustainable Development and Environmental Performance 77 Financial Statements Section 6 Fraud Control 76 Freedom of Information 77, Appendix D Government R&D Priorities 21 Index/Contents Appendix G Industry Representative Bodies 65 Insurance 76 Judicial Decisions and Reviews by Outside Bodies Nil Ministerial Directions 64 Objectives and Functions of SRDC 63 Occupational Health & Safety 77 Operational Problems Nil Organisational Structure 74 Patents 75 Principal Programs: Outputs and Outcomes Section 4A Principal Programs: Performance Section 4B Progress in Achieving Objectives 24 Publications Appendix C Report of Portfolio Operations Section 4 Report of Corporate Operations Section 5 7 Resolution of Directors Letter of Transmission Responsible Minister 65 R&D Activities Section 4 R&D Plan 64 Selection Committee Annual Report Nil Significant Acquisitions/Disposals of Real Property Nil Significant Changes in State of Affairs Nil Significant Events (Section 15(1) of CAC Act) Nil Subsidiaries/Associated Companies Nil

ANNUAL REPORT 2005–2006 143

Appendix G

General Index

Page Annual Operational Plan 2005–06 64 Audit Committee 72 Audit Report 80–81 Australian Government Priorities 24 Board meetings 71 Communication 75 Consultation 14–15 Corporate Governance 65 Corporate Outcome 1 Cost-benefit analyses 60 CRC for Sugar Industry Innovation through Biotechnology 44–45 Directors of SRDC 68 Ecologically sustainable development 77 Expenditure 16, Section 6 Final reports Appendix C Financial statements Section 6 Freedom of Information 77, Appendix D Fraud control 76 Functions of SRDC 68 Highlights 5–7 Income 16, Section 6 Industry reform 19 Industry Representative Bodies 65 Intellectual Property 75 Legislation 63 Objects of the PIERD Act 1989 63 Objectives of SRDC 64 Performance assessment Section 4B 7 Privacy 77 Programs of SRDC 91 Key outcomes Section 4A Project statistics 13, Appendix A Risk Management 76 R&D Awards 54–59

ANNUAL REPORT 2005–2006 145 Page R&D Organisations Appendix A R&D Priorities 24 Research levy 16 SRDC R&D Plan 2003–2008 64 Staff 74 Sugar production 10 Sugar Yield Decline Joint Venture 30–31 Working Parties 13

146 SUGAR RESEARCH AND DEVELOPMENT CORPORATION Section 8 Selection Committee

8 Mr George Rance 191 Richmond Road CAMBRIDGE TAS 7170 29th August 2006

The Hon Sussan Ley MP Parliamentary Secretary, Minister for Agriculture, Fisheries and Forestry Parliament House CANBERRA ACT 2600

Dear Ms Ley, This report finalises the activities of the Sugar Research and Development Corporation (SRDC) Selection Committee in relation to the nomination of six Directors for appointment to the Board of the SRDC submitted to the Hon. Senator Richard Colbeck, the then Parliamentary Secretary on 15 April 2005. Establishment of the Selection Committee The SRDC Selection Committee was established under the Primary Industries and Energy Research and Development Act 1989 (PIERD Act) for the purpose of nominating to the Parliamentary Secretary six persons for appointment as Directors of the SRDC Board. The Parliamentary Secretary appointed Mr George Rance as the Presiding Member of the SRDC Selection Committee for a three year period, commencing 1 July 2004. In accordance with section 124 of the PIERD Act, on 24th January 2005 nominations were sought from the SRDC’s three representative organisations, the Australian Canegrowers Council, the Australian Sugar Milling Council and the Australian Cane Farmers’ Association. The following people were appointed to the Selection Committee on 9th March 2005: Mr Ross Walker Representing the Australian Cane Farmers Association Mr Geoffrey Mitchell Representing the Australian Sugar Milling Council Mr Alf Cristaudo Representing the Australian Cane Growers Council Ltd. The Selection Process An advertisement seeking applications for the 6 Board positions on the SRDC was placed in the national press on the weekend of 5th February 2005 and in the Brisbane Courier Mail on 7th February 2005. The advertisement called for written applications against the core criteria contained in the PIERD Act including: sugar production, processing and marketing; science, technology, and technology transfer; management and conservation of natural resources, including environmental and ecological matters; administration of research and development projects; economics; finance and business management; and sociology. A total of 42 applications were received, including applications from all of the current Board members.

148 SUGAR RESEARCH AND DEVELOPMENT CORPORATION The Selection Committee met on several occasions to determine the process, to receive appropriate briefings and to review the applications. The Presiding Member also conferred with the SRDC Chairperson on the future strategic direction of the Corporation. Interviews were held on 7 and 8 April 2005. Board Appointments Upon completion of this process, in accordance with section 131 of the PIERD Act, the Selection Committee forwarded six nominations to the Parliamentary Secretary on 15 April 2005. On 28th April 2005 the Parliamentary Secretary made the following five appointments for a term commencing from 1 May 2005 and ending on 30 April 2008: Mr Andrew Barfield (reappointment) Mr David Braddock (reappointment) Ms Patrice Brown (reappointment) Dr Mary Corbett (reappointment) Dr Douglas Hogarth (reappointment). On 26th April 2006, the Parliamentary Secretary appointed Mr Stephen Guazzo to fill the sixth position as a new appointment for a period ending 30th April 2008. Disbanding of the Selection Committee As there were no further matters outstanding, the Selection Committee was disbanded on 30th May 2006 in accordance with Section 129 of the PIERD Act. Costs Administrative support for this process was provided by National Strategic Services Pty Ltd and expenses incurred are set out below.

Item $ (GST Inclusive) Selection Committee travel and expenses 3,608 Applicants travel and expenses 1,364 Advertising — Newspapers 5,398 Presiding Members consultation fees 17,495 Administration Costs 171 TOTAL 28,036

Yours sincerely

George Rance Presiding Member 8 Sugar Research and Development Corporation Selection Committee

ANNUAL REPORT 2005–2006 149