Mohawk to acquire NZ carpet maker Bremworth
Premium wool carpet maker Bremworth is being sold to the world's largest flooring company.
However, Bremworth chief executive Greg Smith says the move could also open the door to cheap imports from the United Kingdom.
He says Friday’s coalition announcement, under which Government agencies will be required to select woollen fibres over synthetic alternatives in their buildings is significant but it also has the potential to benefit sheep farmers overseas at the expense of their New Zealand counterparts.
He says greater clarity is needed to understand whether the intent of the decision is to support New Zealand’s rural economy, reduce the use of plastic materials in construction, or both.
Smith claims the move has the potential to double the price of wool farmed in New Zealand but a question remains as to where a government-specified product would fit within free trade agreements with other countries.
He says that while New Zealand wool is generally considered to be suitable for carpet production by international manufacturers, the new policy may see volumes of cheaper imported options become available here.
“With climatic conditions that produce less rainfall, New Zealand sheep grow a whiter wool that is easier to colour than the more yellow fibres found in wetter climates such as the UK,” Smith says.
“As a result, New Zealand produces a higher quality wool that sells on the open market that sells for around 20% more than British wool.”
However, he says that if Government procurement policies allowed for imported wool fibre building products to access the New Zealand market, there would be few benefits for New Zealand other than a reduction in the use of plastic.
“It would be soul-destroying for farmers in the sector to see one imported product replaced with another in the construction of publicly-owned buildings,” Smith says.
“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,” he says.
Smith says the move has the potential to address conflicts in international perceptions of New Zealand’s approach to sustainability.
He claims NZ-grown wool is prized overseas but it has not received the same recognition locally.
“We have an unusual situation where New Zealand 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 New Zealand 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,” he says.
Smith says the move is a significant credibility boost for wool and will result in greater investment in research and development and could lead to the production of more sustainable construction materials.
He says the new Government policy will lead to a significant reduction in the amount of plastic waste entering our landfills.
“As the use of wool as a building material grows, we can expect to see more investment in the development of new materials and alternatives to synthetics.
“Examples of these innovations include the use of waste wool in biodegradable weed and mulch mats which release nutrients as they break down.
“In addition to their local use, these new products will also find their way into export markets,” he says.
