Demand for New Zealand strong wool is increasing but the industry needs to get the basics right to achieve full value potential, WoolWorks president Nigel Hales says.
Recently returned from China and currently in Europe, Hales said “there are very good signals out there” for NZ wool but clip preparation has deteriorated to the extent it needs some serious correction.
“It comes back to the very basics done in the shearing shed and if preparation is not handled correctly, it means punishment in the marketplace,” he said.
WoolWorks is NZ’s only wool scouring service provider, operating the largest wool scouring facility in the world.
“With demand improving, we have to get it right and now is the time to have a reset in the shearing shed,” Hales said.
Having attended the Nanjing Wool Market conference, the largest wool industry conference globally with wool participants from across the world, Hales said it had been extremely disappointing to hear complaints about the NZ wool clip.
NZ was also represented at the conference by Rosstan Mazey, chair of the NZ Council of Wool Interests, Wool Impact and exporters.
“Unfortunately, and of great concern to us all, the Chinese were complaining bitterly about the deterioration of the NZ strong wool clip,” Hales said.
This included poor clip preparation, particularly yellow fribs, medullated fibre being left in the body wool, poor length characteristics and general non-wool contamination – “all the basics in the shed”.
“The Chinese openly stated that they are prepared to pay more for NZ wool, but not until it is handled correctly at the source.
“Further to this we are having an epidemic of non-wool contamination finds in the South Island wool.
“Our staff cannot keep up with the recording of finds as it’s such a high volume.
“It is unbelievable how quickly the wool clip in the South Island has changed and it is now a greater problem in the South Island than the North Island.”
Hales said WoolWorks has done its absolute best to mitigate the contamination issues over a long period of time, at great expenditure and cost to shareholders.
“The last couple of months has been brutal for us.”
WoolWorks has a staff reporting system where it pays its staff a premium to identify non-wool contamination and trace it back to the farm.
For August, in the South Island alone, this cost WoolWorks $20,000 in staff premiums. For September it was $14,000.
“Quite frankly, something has to change as we cannot continue to find such bad behaviour and poor practices in the shed.
“Unless something changes in the shed then this industry will fail, it’s that simple.”
The feedback coming from buyers is positive.
“The Chinese want knit wools at the moment and of all the four major wool producing countries globally, the feedback is NZ, with sound genetics, quality characteristics and specialised facilities, best fits their requirement.
“A price change is coming if we get it right, because the Chinese want knit wool and NZ wool is most suitable for dyeing.
“Good coloured wools that can be dyed more naturally have always been attractive for overseas buyers but we will never reach full-scale potential with poor shed preparation.
“There are many good things happening in the industry but we just see there is a disconnect between the marketplace, producers and shed hands,” Hales said.
Addressing the recent NZ Woolclassers Association North Island industry day, PGG Wrightson wool representative and industry mentor Ian Hopkirk made it clear there is value in adding value.
“There is no denying the importance and value of upholding quality preparation in the shed,” Hopkirk said.
“That is the ultimate aim of wool preparation – to prepare the farmers’ wool to achieve best commercial advantage.
“Remove to improve is key to the reputation and integrity of NZ wool.”
The preparation for wool has to happen in the woolshed, he said.
“Adding monetary value is the difference between poor and good preparation. An extra shedhand might be $250 a day. At 12.5 cents a kilogram that could achieve up to a 50c/kg improvement in price achieved, a reasonable return on investment.”
Hopkirk urged shed staff to have a “can-do, will-do attitude”.
“It’s about value in adding value; dollars in reputation and satisfaction. Good preparation increases competition to purchase and improves options for end use and contracts.”