A new directive mandating the use of woollen fibres in government buildings where feasible comes with a warning from a leading industry player.
The directive has the potential to transform the rural sector, but it could also open the door to cheap imports from the United Kingdom, Bremworth chief executive Greg Smith said.
The directive has the potential to double the price of wool farmed in NZ, but there is a question over where a government-specified product would fit within free trade agreements with other countries.
Greater clarity is needed to understand whether the intent of the move is to support NZ’s rural economy, reduce the use of plastic materials in construction, or both, Smith said.
While NZ wool is considered ideally suited for carpet production by international manufacturers, the new policy may see volumes of cheaper imported options become available in NZ.
“With climatic conditions that produce less rainfall, NZ sheep grow a whiter wool that is easier to colour than the more yellow fibres found in wetter climates such as the UK.
“As a result, NZ produces a higher quality wool that sells on the open market for about 20% more than British wool.”
The government is New Zealand’s largest property owner, with more than 16,000 buildings valued at over $31 billion.
“If government procurement policies allowed for imported woollen fibre building products to access this market we would see few real benefits for NZ, other than a reduction in the use of plastic,” Smith said.
“It would be soul-destroying for farmers to see one imported product replaced with another in the construction of publicly owned buildings.
“What we need right now is greater clarity around the parameters of this policy and recognition of the inherent tax benefits to the economy when we support local.”
The move has the potential to address conflicts in international perceptions of NZ’s approach to sustainability.
NZ-grown wool is prized overseas but has not received the same recognition locally.
“We have an unusual situation where NZ wool has been woven into the fabrics used on Air Force One. However, if the US president or any of the numerous other foreign dignitaries who have flown on that aircraft were to enter a government building in this country, they would most likely be walking on imported synthetic carpet.
“When we talk to potential export partners in new markets, they are dumbfounded by the fact that our government does not use our wool in its buildings.
“They find the whole concept quite conflicted as NZ is known for its sheep production.
“We might want to be known for spaceships and rockets and technology and gaming but that’s just not what we are known for and it’s unlikely we will ever shed that image.”
Smith said despite record low numbers of sheep being farmed, there is sufficient wool supply in the market to scale up production to accommodate a surge in demand.
“It is difficult to overstate the potential economic benefits of this move for the sector.
“This has the potential to be one of the most significant changes in the wool industry since synthetic alternatives were introduced two decades ago.”
At that time the market went from 90% wool to 90% synthetic carpet.
“The sector hasn’t recovered from this trend and the number of sheep in NZ fell by 2% last year to 23 million, the lowest ratio of sheep to people in NZ we have had in the past 150 years.”
Ten years ago wool was trading at twice what it is today and Smith believes a return to this pricing is quite possible.
Wool Impact, the industry entity tasked with lifting the value of NZ strong wool, has been advocating for government agencies to rethink the way they approach the use of wool following a decision earlier this year to use plastic tiles in school flooring.
Wool Impact chief executive Andy Caughey said the new directive “is a positive step forward for enhancing the value of woollen fibres, in particular the uses of strong wool in carpets and insulation”.
Wool is the obvious choice as a natural fibre and is often overlooked when set against artificial fibres due to its costs and some of the less logical inferences.
“Wool Impact is working closely with growers, brands and industry leaders to invest in environmental impact measurement, evidencing the performance benefits of wool products and ensuring the broader positive and negative impacts, such as microplastics, of all fibres are considered,” Caughey said.
“Wools of NZ has long been advocating for the use of wool in public sector buildings so the government’s decision is a significant boost to wool growers and the industry,” Wools of NZ chief executive John McWhirter said.
“Our commercial wool tile range is a key part of the company’s strategy to significantly improve outcomes for NZ strong-wool producers.”