Laurence Modiano, the owner of one of the biggest early-stage wool processors in the world, has urged wool growers to “grit their teeth and plough on” in the face of plummeting demand for the fibre, despite lower supplies in Australia.
The need for proper marketing of wool has become crucial. “On-farm projects will have no value if the overall demand for wool continues to drop,” said Modiano. “industry will have to find the best way of selling the superb story of wool, its people, its animals, its history and its advantages over other fibres.”
H ugo Lemon, a textile technologist in the menswear division at Woolworths South Africa, agrees wool is the best natural fibre by far, but that it’s constantly being held back from sustained growth in market share by the way it’s bought and sold. “There is no long-term stability in pricing on which to plan short spans of market acceptance of the product, which are always followed by periods of rejection,” said Lemon. “And every time consumers reject wool, more market share goes to other fibres. It could be time to re-introduce a stabilising price mechanism and give the local and export industries some indirect incentive to add value to our own resource.”
Lemon conceded that free market punters would object to this, but pointed out that the last 10 months have shown what a supposed free market can do. “damage will take a long time to repair,” he said. he inevitable cycle that wool goes through can’t be broken – either the price is too high or the economic factors are poor or both, Lemon said. “The current economic crisis puts wool in a different predicament than during the 2001/02 meltdown.
This time wool has met the economic slowdown on high price levels, playing back into the hands of cotton and synthetics. Wool could easily find itself out on a limb if it becomes unaffordable.” Meanwhile, the local weekly auction system is reported to be showing cracks.
According to Petrus de Wet, president of the National Wool Growers Association, the first large-scale contracts bypassing auctions have been negotiated for 2008/09. Writing for the Wool Farmer he said one of the country’s big brokers has already earmarked 30 000 bales out of the total South African offering of 300 000 bales. “If we get more for our product on a sustainable basis, we’ll support the move,” said De Wet. But he cautioned farmers that circumventing the existing supply chain isn’t that simple. “There are established trade relationships with jealously guarded vested interests. product changes ownership and each new owner is in the business to make money.
The industry doesn’t really worry about the origin of the wool. It’s a commodity that loses its identity as it’s blended from factories around the world.” e added that spinners are more sensitive to landed costs and quality specifications, while the mulesing issue has not yet been resolved. “This perhaps leaves an opportunity for us to exploit the situation,” De Wet said. – Roelof Bezuidenhout
