Queensland’s sugarcane industry has welcomed the Federal Government’s move to kickstart a national biofuels sector, saying the state is uniquely placed to lead the nation in clean energy production and regional job creation.
The government’s new ten-year Cleaner Fuels Program, announced today, commits $1.1 billion to support the development of low-carbon liquid fuels such as biodiesel and sustainable aviation fuel (SAF).
CANEGROWERS CEO Dan Galligan said Queensland is already ahead of the curve, with sustainability credentials and infrastructure in place to support rapid industry expansion.
“Almost half of Queensland’s sugarcane is recognised by the world’s three biggest sustainability gatekeepers as a global leader in sustainable farming,” Galligan said. “This gives immediate confidence to airlines, freight, and heavy industry that our local feedstocks meet international standards.”
He pointed to Queensland’s existing cane rail network as a critical asset that could serve as the backbone of a future bioeconomy.
“Our cane-growing regions stretch along the coastline and are adjacent to major population centres,” he said. “We also have a cane rail network spanning thousands of kilometres, connecting farms to mills and multiple deep-water ports.”
“This footprint shortens supply chains, reduces costs, and lowers the risks of rapidly scaling up domestic low-carbon fuel production. With sugarcane alone, Queensland could supply more than 30% of Australia’s aviation fuel demand.”
Galligan added that the initiative could position Queensland as the nation’s biofuels hub, driving cleaner fuels for transport, new regional jobs, and billions in investment.
Australian Sugar Milling Council (ASM) CEO Ash Salardini also praised the government’s commitment, calling it a “once-in-a-generation opportunity.”
“The government must be commended for grabbing this moment with both hands,” Salardini said. “The challenge isn’t the technology anymore—it’s about building a reliable, scalable, and cost-effective supply chain.”
He warned that without focused support for feedstock logistics and infrastructure, Australia could become dependent on imported bioethanol—swapping one form of import reliance for another.
“We risk replacing imported fossil fuels with imported biofuels from countries like Brazil and India unless we get the supply chain right,” he said.
Federal Treasurer Jim Chalmers, who announced the Cleaner Fuels Program, said Australians could see the first production of “drop-in” cleaner fuels by 2029.
“The global net-zero transformation is a massive economic opportunity for Australia,” Chalmers said. “Producing low-carbon liquid fuels is a key part of that opportunity and will help us join the global supply chain for clean energy.”
“This initiative is about lifting wages, growing living standards, and creating economic opportunity across the country as part of the energy transition.”
Both CANEGROWERS and ASM said the benefits for Queensland are enormous if government and industry get the model right.
• Towns like Cairns, Mackay, Bundaberg, Townsville, Childers and Tully could become bio
precinct hubs, producing clean liquid fuels, biogas and renewable electricity.
• Feedstock supply chains will be the source of tens of thousands of new jobs in farming,
transport, processing, manufacturing and logistics.
• The sugar industry already supports 20,000 jobs and contributes $4.4 billion annually to the economy, and can grow even further.
“If we get it right, we’ll unlock thousands of jobs across regional Queensland and demonstrate that the path to net zero can deliver well-paid employment to communities throughout Australia,” Salardini said.
