Exporters Calming Wool Supply Uncertainty Fears

13 August 2008

Exporters Calming Wool Supply Uncertainty Fears

International users of crossbred wool are becoming increasingly concerned the proposed grower cooperative-hybrid wool company will intervene in the market and disrupt their supplies.

There is a vacuum of information about what the new wool company is proposing to do and this is causing uncertainty around the billion dollar industry, says wool exporters' council executive member Peter Crone.

"We are being asked to support a new wool company and eventually to finance it despite it having no name, no chief executive, no business plans, no prospectus and no financial projections.

"The hybrid concept is flawed, the good parts they are talking about already happen. Once again it will be the woolgrower who suffers the biggest financial impact when it inevitably falls over."

He called for The Wool Company, Wool Industry Network and Woolgrower Holdings to publish the facts and open up debate to put an end to the uncertainty.

"Our members are getting enquires from their clients and we are having to allay their fears," Mr Crone said. "Our traditional wool users are also synthetic manufacturers and they are asking themselves whether there is a risk if they persist with wool.

"They all remember the days when the old Wool Board stepped in and took wool out of the supply chain and they perceive the objectives of the new company as being the same. They say that it would be the last straw if it happened again.

"Most of our members have opened up dialogue with the Wool Industry Network but as soon as they have expressed views that differed with WIN thinking they've been cut off from any further discussions."

A major UK-based exporter and customer very recently sought a meeting with WIN while on business in Christchurch, but was completely snubbed, Mr Crone said.

Members of the New Zealand Council of Wool Exporters collectively buy 80 percent of the New Zealand clip and sell it to carpet textile manufacturers in the United Kingdom, Europe, Asia, Australasia and the United States.

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