Wednesday, July 6, 2022

Woolgrowers urged to think again

Much more sophisticated strategies are required to get New Zealand crossbred wool out of its 15-year rut and keep it out, says wool industry commentator Roger Buchanan.

LIFE IN WOOL: Wool industry commentator Roger Buchanan has written a book about his experiences over 50 years in the New Zealand wool industry.

Wool producers are very exposed to the vagaries of international fibre and textiles markets without collective investment in research and development, he says.

The recent rapid improvement and then decline in strong wool prices just illustrated the inevitable commodity price cycles amplified by the lack of market support.

Opportunist processors realised that wool was too cheap but then got burnt by the inevitable rebound.

“Turning these opportunists into long-term, committed users of NZ wool will not happen by chance,” Buchanan said.

“There are individuals and enterprises out there capable of turning the industry around, and one day wool growers will surely realise that the status quo is not the answer.”

These observations are made by Buchanan towards the end of his autobiography, called Last Shepherd, recently published after more than 50 years in the wool industry.

He was literally the last wool functionary left in office after the disestablishment of the Wool Board and its protracted burial beset by court cases over the remaining growers’ reserves.

Born and bought up on a Manawatu sheep farm, he gained the Massey wool diploma in the early 1960s and then worked for the Wool Commission on its appraisal and buying teams, and the Wool Marketing Corporation before moving into international promotion and senior management with the board.

More than 50 trips to China between the 1970s and 90s, along with numerous others to India, Nepal, the Middle East and Eastern Europe, highlighted Buchanan’s efforts to promote NZ strong wools.

He was the final chief executive of what became Wools of New Zealand in 2003 but then spent a further nine years part-time for DisCo until a group of superfine wool growers led by Peter Radford exhausted all legal challenges to levy apportionment decisions made by the board in the 1990s.

During those years several attempts to re-unite growers in commercial entities failed, for which Buchanan leaves the reader in no doubt of his regret.

“The little that remains of Wools of New Zealand has been preserved courtesy of a trust supported by a few committed woolgrowers and small commercial revenues,” he said.

He hopes it can yet form the chassis of commercial vehicles for fully integrated supply chains.

Buchanan dissects the various wool support schemes that operated post-war, NZ’s growing dissatisfaction with the International Wool Secretariat, the Fernmark approach to NZ-only promotion and the hole which McKinsey dug for the NZ industry in 2001.

He believes farmers do see value in R&D and farm-related activities like shearing training, but are unconvinced of the need for them to invest in the promotion of their fibre, in particular to consumers.

When the board got away from underwriting wool returns, firstly to more active trading and then no market intervention at all (1991), its remaining activities came under closer scrutiny.

“Growers realised the board’s primary remaining function, funded by levies, was international promotion, which they didn’t understand let alone value.

“And the board had been repeatedly portrayed as a waste of space,” he said, before McKinsey got out the spade.

One of its conclusions was it was not possible to quantify the return from promotional expenditures, which was news only to farmers.

However, the now-apparent cost of not promoting was not emphasised and McKinsey proposed replacement vehicles failed to fire.

The insider analysis of the objectives and failures of wool promotion has been published by Ngaio Press, owned by John MacGibbon in Wellington, a former Wool Board communications manager.

Last Shepherd is visually similar to Wool, a History of the New Zealand Wool Industry, published by Ngaio in 2003 and written by Bill Carter and MacGibbon.

The cover photograph is of Buchanan, aged about six in 1950, standing on a box in bare feet and child’s overalls, drafting sheep.

It is a strong symbol of his lifetime in wool, which he calls an infectious fabulous fibre, and a working lifetime spent trying to control the currents of the turbulent wool industry.


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