Growers flag lack of wool price progress

So to get agreement to raise the wool levy may be a tall mountain to climb when growers vote in this year's WoolPoll from September 20.

While opinions are varied on whether the levy should remain at 1.5 per cent or be increased (the options also still pending the WoolPoll committee's recommendations), most growers agree the industry needs to see a result from their hard earned money.

The Land spoke to a selection of wool growers who were also survey participants that had indicated they were happy to share their views on the levy and Australian Wool Innovation's performance.

Nick Lyons and his sister Natalie are sixth generation wool growers, running 2000 soft-rolling-skin Merino ewes and about 1500 Merino wethers, producing between 17- and 18-micron wool.

The Lyons have a contract with a Japanese company for their fleece and also supply a company called Great Southern Yarn. The rest goes through the auction system.

Mr Lyons said he hasn't seen much of a change in the wool industry since the last WoolPoll.

"I haven't seen a dramatic change between the last WoolPoll and now," he said.

"I think maybe the political environment has changed a lot and AWI are pivoting to match that.

"I think things are heading in the right direction and we've reached an equilibrium between how satisfied producers are with AWI and their requirement to have a voice."

Mr Lyons was, however, adamant the levy should return to two per cent, believing it was the only way AWI could remain effective.

"I think 2pc was the sweet spot," he said.

"I think you have to decide on what you want from them.

"From my perspective, what they're spending the money on domestically doesn't line up with our production goals, but what they're doing overseas absolutely does line up and to lose that would be catastrophic.

"For the sake of a couple of grand a year to get a voice at the European Union - that's pretty important."

Mr Lyons said he has seen good results from AWI training schools.

"The quality of shearing has really stepped up in recent years. So the work AWI has done there has been beneficial and I would like that to continue," he said.

Angus Whyte and his wife Kelly run a mixed farming enterprise incorporating a Merino wool operation on Wyndham Station near Wentworth in the state's south-west.

Mr Whyte believes for AWI to return to being effective the levy should be raised.

"Personally I feel AWI was more effective when the rate was 2pc," he said.

"I feel it should go up, but we need to see results. They need to put some significant focus looking at if our producers are viable?

"They need to look at producer sustainability, not just industry sustainability.

"When large producers are starting to question why they are part of the wool industry, I reckon we've got some major problems.

"Looking back since the reserve price scheme, which was probably 35 years ago, in 20- to 21-micron fleece, there's probably been five or six years when you've been making good money.

"I'd say currently in the 20- to 21-micron area, and we've got wool up for sale next week, I'd be saying the prices should be from a clean basis around about 50pc higher.

"So instead of being 1300 cents, being 2000 cents (a kilogram) clean. That's what we need for us to be profitable now."

Mr Whyte said cutting costs for wool producers is one way to improve viability, but said there needs to be more.

"I know they're looking to maybe reduce costs as far as wool handling, wool harvesting and shearing is concerned," he said.

"But they need to look at marketing and it should be marketing around pipeline sustainability.

"Everybody in the pipeline needs to be able to get some salt out of this."

Chick Olsson is no stranger to AWI, having been a board member between 2008 to 2011, and understands its inner workings.

Mr Olsson doesn't feel much has changed since his tenure on the board and he believes now is the time for a different approach.

He said carbon neutral wool was a good opportunity to expand wool's market share.

"There's a massive market for carbon neutral wool and it's basically been untapped at this stage," he said.

"Wool is the only fibre in town that has natural sustainability.

"We accidentally have a fibre which is carbon neutral and is perfect for the planet.

"The key will be how to communicate that. You've got to appeal to new consumers and this is what the AWI marketing team is about to focus on, which I fully support.

"We need one clear message that wool is good for the planet and if we focus all our resources on that, it will be successful and demand for wool will increase."

Mr Olsson said a group of wool growers had already tried to get carbon on AWI's agenda.

"A few visionary wool leaders said carbon is a way to go and we set up the Wool Carbon Alliance in 2009 or 2010," he said.

"That was shut down later on by older members that didn't think climate was an issue. But now it is an issue like never before."

Mr Olsson believes time's running out to turn the wool industry around.

"It's really do or die time," he said.

"Petrochemicals are attacking our natural credibility.

"I think we've got two more WoolPolls, maybe six years, at the most if we're lucky."

Linda O'Reilly and her husband Garry are ultrafine wool growers in central NSW, running 1500 Merinos.

Mrs O'Reilly said ideally they would run 2500 ewes, but she said they have reduced numbers because "there is no money in wool".

"We're replacing the Merinos with Aussie Whites because we don't have a lot of option to run anything else here," she said.

"There's no money for us in growing wool.

"So in regards to the levy, I don't think AWI do anything for us at all with what they get.

"I'd be happy for it to go up if they utilised it in a way that was actually beneficial to a wool grower.

"At the moment, they do their research into shearing the sheep without shearing, and they do drenching and things like that.

"They should be researching how to promote wool. It's a green product but have you ever heard it in the press being promoted as a green renewable product?

"I haven't."

Mrs O'Reilly believes AWI needs to improve marketing.

"You never see any more marketing for the consumer," she said.

"I know times are tough and people don't have much money to spend, but you know people still go and buy Toyotas and Fords because they're marketed as a better quality, longer life product.

"They've built that brand recognition and that's exactly what wool needs to do."

Running 8000 Merino ewes on the North West Plains, Robert Wason wants more clarity from AWI on how it will benefit his Urie Point enterprise.

He says the levy should stay where it is unless AWI can prove it can provide more benefit to wool growers.

"I don't think AWI has done much to improve the market or improve the access to better technology," he said.

"I'm not seeing value for money on either the R&D side of things or the marketing side.

"R&D is very important, especially if they can make an easier way to harvest wool and handle it. But there needs to be better ways to sell it.

"At the moment we are selling something at auction and you've got maybe half a dozen buyers vying for it. So it's not really an auction is it?

"Each buyer's probably buying for five or six or maybe more different companies.

"So it's very hard to be competitive when they've got so many different people they're buying for.

"I would like to see AWI expand into different markets to bring more buyers to the auction."

Mr Wason said AWI needed to be researching and developing markets in other countries.

"We're dominated by China and if China has a hiccup, we have a heart attack," he said.

"We should be able to get our product into all sorts of things. It's got so much going for it."