By John McWhirter, chief executive of Wools of New Zealand
There has been a lot of commentary in recent weeks regarding the wool sector, including Alan Emerson’s Alternative View article in these pages, “Wool could help solve our mega microplastics problem” .
We welcome the conversations and debate about wool and the sector’s fortunes – it shows farmers care, and how committed they are to securing a brighter future for growers and the industry.
At Wools of New Zealand (WNZ), a company owned by 2,100 proud sheep farmers, we’ve changed our strategy significantly over the past two years.
We’re now selling branded woollen carpet through retailers and we’re just about to launch a commercial wool tile range. It hasn’t been easy and we’ve learnt quite a few things along the way.
WNZ chose to manufacture offshore using wool grown here because this offered us and our growers the best chance of success.
Rather than “competing”, that decision to partner with overseas businesses has been about driving growth despite a limited balance sheet.
The past 25 years have seen a continued decline in the demand for strong wool driven by ongoing decommissioning of production capacity and capability, globally and domestically.
There has been little to no investment in the development of manufacturing systems for wool products, including in the New Zealand industry, coupled with divestment of production capacity worldwide.
Over the past three decades, many strong-wool global manufacturers, including spinners, have responded to falling consumer demand and switched their factories to synthetic fibres, or closed.
Of the remaining woollen manufacturers, many are smaller scale and struggle to compete with large synthetic manufacturers, so focus more on niche offerings to the market.
New product development, investment in production and global expansion coupled with commercialisation will lead to growth, but that requires investment. Without that, the wool industry will just have to wait patiently for prices to increase.
WNZ is a farmer-owned business set up to improve outcomes for its sheep-farmer shareholders. We are working to establish up a global business but we do not have the balance sheet to forge ahead with new opportunities at pace.
We are also working to do that on the back of the pandemic and poor wool prices – WNZ’s only source of capital at a time when costs are rising. There have been challenges, not least Cyclone Gabrielle and the flooding damage to the Napier wool scour as well as softening global markets for lamb.
If our industry wants to see demand for strong wool growing, we need access to increased capacity, combined with improved technology.
To that end, we have been working with Zenova, a fully vertical manufacturer of carpet in Turkey, because they have the resources and the willingness to invest and are world leading in terms of production capacity.
Over the past three years, Zenova has ploughed many millions of dollars into increasing that capacity by 40%. That will be far more than the entire NZ wool industry has invested in that time.
We are fortunate that one of the largest wool spinners and carpet manufacturers in the world is keen to work with us. We have limited capital, our investment is mostly people, skill and energy, but through this relationship, we will be able to grow.
WNZ’s job is to take these NZ wool products to the internal market in Australasia as well as to the United Kingdom, Europe and United States markets. That in itself is a significant task that will have its challenges, but if we want to change the industry, it must be done.
WNZ supports all of the initiatives being pursued across the industry to grow the demand for wool. No one entity will make the difference by itself; it will be the efforts made by many businesses who are prepared to make the effort, invest and take the risk. And they will be looking for a return on their investment and rightly so.
Investment in production and new opportunities carries risk. Some will not succeed, but one thing’s for sure: not investing in anything will deliver absolutely nothing.
There is now more collaboration and unity in the wool sector than ever before. Not all initiatives will be successful, however the likes of WNZ, Wool Research Organisation of New Zealand (WRONZ) and Wool Impact are all working together to achieve a common goal – to lift the fortunes of the strong wool industry.
And there are some great initiatives happening.
As an example, WNZ is about to launch our commercial wool tile range at a price competitive with the high-end synthetic tiles market.
This is the result of an 18-month testing programme in conjunction with manufacturers and growers and will take the product to a wider audience with a growing interest in the beneficial natural properties of wool flooring.
Wool Impact has been supporting WNZ in the development of new products along with Wool Source, founded by WRONZ. This takes time as the types of products have never been made before. We are talking brand new technology with product benefits that only wool can deliver and this has been supported by outside engineers who are experts in their fields.
Rather than criticising farmers and the organisations and businesses who are making an effort to increase demand for wool, we should be applauding them. Most of those doing this work are underfunded. They are doing the hard yards and working in practical but innovative ways to change the fortunes of the strong wool sector.