Time for woolly thinking is over
19th Mar 09, 1:35pm
This is the year strong wool will re-emerge in sheep farmers' minds as a commodity to be taken seriously - or not writes the Dom Post. It has been decades since the coarse fleece shorn from the backs of NZ's hill country sheep was a serious earner. Prices are edging up from all-time lows, but in the global recession are picked to slump again. Wool is seen by many of today's young farmers as a nuisance, the costs of removal barely recovered at auction. Only the older farmers who remember fierce industry- wide debate about how to market wool still hope it can be revived. The big problem is that strong wool has really only one use - carpets. Some goes into furnishing textiles and some into house insulation, and occasionally an innovative deal, such as wool- coated tennis balls, is made. But without carpets, NZ doesn't have a wool industry, and it is disturbing to find that in the US, the world's biggest market, only 3% of carpets are made of wool. This year could mark the start of a fight-back for strong wool. Disgusted by low prices, farmers have launched a bid to take over the industry. Exploratory forays into the international carpet industry by a farmer-led initiative have returned encouraged by the reception. At the same time, efforts to restructure within NZ are coming to a head. Farmers will soon be asked to sign up to a new co-operative. They will be asked to become shareholders and to supply its 40% owned marketing company with wool. The prospectus for the co-operative has yet to be seen, but judging by the $46 million already committed by PGG Wrightson, its marketing partner, around $30m could be needed.Farmers won't be asked to commit large sums immediately, but to accept relatively painless deductions of about 20 cents a kilogram from their wool cheques over five years.