Monday, 01 November 2021 07:55

Wool merger important to industry's future success

Written by  Derek Daniell
Derek Daniell is a leading ram breeder based in the Wairarapa. Derek Daniell is a leading ram breeder based in the Wairarapa.

OPINION: It’s hard work as a strong wool grower but I firmly believe New Zealand wool is on its way to reinventing itself.

There are a number of exciting things happening and I’m optimistic for the future.

First step is the proposed merger of operations between Wools of New Zealand and CP Wool, which is owned by Primary Wool Co-operative. Online voter information meetings are now underway and these are a great opportunity for shareholders of both organisations to hear about the plans and ask questions.

I’m a shareholder in both WoNZ and PWC – I was among those who put in funding from the outset to get WoNZ up and running. I’m also a supplier of rams to farmers in New Zealand. We sell 2,500 rams a year from Cape Reinga to Bluff – mostly Romney and FE resilient, with some composites, terminals and Wairere merino halfbreds.

I’ll be voting yes to the merger of operations. Because while WoNZ has done great work to produce branded wool carpet at prices that compete with synthetics, rather than just trying to sell fibre, it lacks the scale to build fast on those gains.

It’s a long chain to send wool to Turkey, get it back as carpet and out to stores around the country. The working capital PWC can provide as a large wool broker will be critical to that chain. We need scale to make things happen.

Combined, the two organisations will have a far bigger number of shareholders and interested parties, and 37% of the New Zealand wool supply.

In another exciting development, Wool Research Organisation New Zealand (WRONZ) is focused on deconstructing wool to a cellular and particle level – effectively in powder or liquid form - and reconstructing it for various product uses, ranging from cosmetics to printing.

I have visited their pilot plant near Lincoln. This is a transformational project with seven years of R&D behind it. Its aim is to take strong wool into a multitude of potential uses, several of which promise to be high volume as well as high value. The next stage is likely to be a call for capital for a plant capable of processing 20,000 tonnes of wool annually.

Farmers are disillusioned with wool. Sheep numbers are shrinking fast because of subsidies for carbon credits. Another risk to the wool industry is farmers moving into ‘bare sheep’ or ‘shedder’ sheep like Wiltshires. This also risks the loss of sheep genetics built up over generations of animals that do best in our New Zealand conditions.

It takes time for the rubber to hit the road. The merger of operations provides an incentive for farmers to stay in wool. The two organisations have been very clear that it is going to take time to lift prices - but this is a catalyst for change.

Those of us with longer memories will recall how until 30 years ago wool was earning more money than meat. It was typically 60% of income for a hill county farm in the 1960s and 1970s.

I certainly don’t think we’ll return to those days. However, as these various initiatives mature, there is real potential for sheep farmers to once again realise dual incomes from their sheep.

Derek Daniell is a leading ram breeder based in the Wairarapa.

More like this

Chinese wool deal to target counterfeiters

Farmer-owned wool fibre and carpet producer Wools of New Zealand hopes that its new partnership with a major Chinese carpet and rug manufacturer will help combat counterfeiters in the global market and highlight the prestige of New Zealand wool to Chinese consumers.

WNZ signs Chinese branding agreement

Wools of New Zealand has signed an agreement with leading Chinese rug and manufacturer Yangxin Ruixin Group for the company to use Wools of New Zealand branding on its products.

A smart choice!

Beef + Lamb New Zealand (B+LNZ) says it’s backing the country’s sheep farmers by choosing wool tiles to carpet its Wellington office.

Featured

Better animal genetic gain system

A governance group has been formed, following extensive sector consultation, to implement the recommendations from the Industry Working Group's (IWG) final report and is said to be forming a 'road map' for improving New Zealand's animal genetic gain system.

SIDE 2025's new schedule, venue

Annual farmer gathering, the South Island Dairy Event (SIDE), is set to make history as it heads to Timaru for the first time.

Taranaki piggery goes solar

Installing 400 solar panels at their Taranaki piggery and cropping operation will have significant environmental, financial and animal welfare benefits for the Stanley family.

Editorial: Keep FTAs coming

OPINION: The dairy industry will  be a major beneficiary of a new free trade deal between NZ and the Gulf Co-operation Council (GCC).

National

Food charity to hold online auction

Meat the Need, New Zealand’s dedicated charity delivering locally sourced protein meals to food-insecure communities, is launching an online National…

Machinery & Products

An ideal solution for larger farms

Designed specifically for large farms that want to drill with maximum flexibility, efficiency and power, the new Lemken Solitair ST…

Landpower increases its offering

Landpower and the Claas Harvest Centre network will launch the Claas Scorpion and Torion material handling solutions to the market…

» Latest Print Issues Online

The Hound

Leaky waka

OPINION: Was the ASB Economic Weekly throwing shade on Reserve Bank governor Adrian Orr when reporting on his speech in…

Know-it-alls

OPINION: A reader recently had a shot at the various armchair critics that she judged to be more than a…

» Connect with Rural News

» eNewsletter

Subscribe to our weekly newsletter