This study investigates the growth in the productive capacity of the Queensland sugar industry since 1960 season. In investigating that growth it was found that the number of independent enterprises engaged within the industry has been declining, despite a continued growth in production. That decline was not seen to be attributed to competition between enterprises, since the legislative framework within which the industry operated was designed to eliminate competition on a price and market basis. Legislative barriers to entry restricted the entry of new enterprises into the industry and were seen as a factor in promoting some consolidation of existing enterprises. However, fundamental changed within the operating environment was seen as the major factor in explaining the decline of independent enterprises.
The growth in the productive capacity of the industry was seen as one means by which enterprises could adapt to fundamental changed; the other, through the acquisition of existing enterprises. Those enterprises unable to adapt to left the industry. The pursuit of benefits from economies of scale was considered the underlying driving force for successive increases in the scale of operations. The nature of economies of scale, the sources of expected benefits, factors contributing towards the extent to which potential benefits could be achieved and to their realization were identifies and investigated.