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Australian Growers urged to complete declarations

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A push is on to get Western Australia woolgrowers to complete the national wool declaration (NWD) as buyers struggle to source sufficient wool to satisfy particular clients.

Schneider Group, New England Wools and Modiano Australia are the main buyers urging woolgrowers to complete the NWD, particularly the mulesing status box which many farmers still ignore.

Western Wool Centre (WWC) buyers – Phil Roberts for Schneider, Darren Calder for New England and Greg Horne for Modiano – have instructions not to bid on lots that do not have a completed NWD because the wool cannot be on-sold to a growing number of clients who demand a transparent supply chain for marketing or ethical reasons.

According to the buyers, more and more clients in Europe, Japan, North America and China are demanding a wool provenance – Chinese processors and mills supply a lot of wool top and woollen fabric to garment manufacturers, particularly in Europe and North America, who demand a provenance so Chinese processors and mills are passing that demand back to supply sources in Australia.

There is strong and growing demand for declared non-mulesed (NM on the declaration), ceased mulesing (CM) or pain relief (PR) wools, buyers claim, with an added proviso the minimum pain relief acceptable to some clients is an analgesic administered before the mulesing procedure.

Signs of this were evident at the WWC recently, exaggerated by a softening general wool market, the smallest weekly auctions offering since November and a fifth of the offering on Wednesday and more than a third of Thursday’s offering being described by Australian Wool Exchange (AWEX) as “inferior style wools”.

While buyers were not prepared to bid up to the reserve price on 18.1 per cent of the 6429 bales on offer, there was a spirited bidding war between Messrs Roberts, Calder and Horne over some lots that complied with specific client requirements.

Several times Mr Horne, who has long led the push for completed NWDs at the WWC, was quite animated, waving his arms in frustration as he was either outbid or watched specific lots he wanted passed in because he had reached his bidding limit for them.

The Schneider, New England and Modiano names stood out more than usual last week in a depleted buyers’ list.

Since the beginning of March, the three buyers for those companies combined have averaged a total weekly purchase at WWC auctions of 154 bales of declared wool.

Despite the reduced offering and high pass-in rate, they bought 183 bales and paid a premium of at least 60 cents per kilogram greasy for them.

Australian spokesman for the Italian-based Schneider Group, Tim Marwedel, said woolgrowers failing to complete a NWD was “ludicrous” and did not make sense as they were potentially doing themselves out of any market premiums paid for NM, CM or PR wools.

“Even if they mules they should declare it,” Mr Marwedel said. “We have clients who say to us they would rather buy wool that was from declared mulesed sheep than wool where the declaration wasn’t filled out. They interpret that as a sign the farmer does not care. We understand that sheep welfare is a complicated story and farmers know what is best for their own sheep, we don’t intend to tell them how they should care for their sheep. All we are pointing out is that we have a rapidly expanding market for wools where there is a provenance, transparency and traceability. We have a lot of good stories to tell about our wool, but we can’t get past it – mulesing is part of those stories. But mulesing should only be one chapter in the story, not the whole story.”

Mr Marwedel said declared non-mulesed Australian wool was competing against wools from Argentina, South Africa and New Zealand, which banned mulesing in September. He said if Australia couldn’t supply what some clients want, they would look elsewhere.

“(Non-mulesed) Argentinian wool is not as good as Australian wool, the yield is not as good, it doesn’t process as well, it used to be much cheaper than Australian wool,” Mr Marwedel said. “Now (because of increased demand not being met in Australia) Argentinian wools from about 19.5 micron and broader are selling for the same, if not more, than Australian wools. We (Australia) has a long way to go on mulesing and WA has even further to catch up than the east coast on this. Anyone who thinks we sell 70pc of our wool to China so mulesing and completed declarations don’t count, is kidding themselves,” he said.

“Woolgrowers keep asking what the premium (above market price for declared non-mulesed wool) is. These days I tell them it’s not so much the premium as whether we can buy or not.”

Mr Calder agreed the market for specific wool types was growing. “What they (New England) are seeing is a marked increase in demand for provenance, which is the traceability aspect and also the animal welfare side of it, which comes back to mulesing and non-mulesed and ceased mulesed wools,” Mr Calder said.

“As an example, (New England has) one client who takes a combing lamb and prem type (wool) who is currently running at around 60-70 per cent NM and CM and would be quite happy to buy 100pc with a premium to the market because the demand is there.”

There was strong demand for NM and CM wools in Europe and North America, Mr Calder confirmed

“(With competition) between New England and Schneider at the moment, some of the top-end fleece – 15-16 (micron) best spinners or spinners – are getting a 200-280 (ckg) premium for NM and CM because, again, the demand is there.

“What they (New England) are always saying to me is to ask the brokers over here to make sure that growers declare the mulesing status correctly because they could be missing out if they CM or NM and are not putting this onto their speci (specification),” he said.

AWEX states on its website the primary function of the NWD is “to enable woolgrowers to promote their animal welfare practices and the dark and medullated fibre risk of their wool to wool exporters, processors and retailers”.

It is the “standardised” method of doing this, AWEX says.

A number of wool trading companies in Australia have special wool buying programs for growers who meet certain criteria in the way their wool is produced and the type of wool it is. These include the Schneider Group’s Authentico Integrity Scheme and New England Wools’ SustainaWOOL Integrity Scheme.

Source: Farm Weekly Australia

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