Friday, March 29, 2024

Boost for strong wool

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New Zealand’s wool industry has gained a boost with a new Primary Growth Partnership programme established to deliver premiums to the strong wool sector.
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“A collaboration between the New Zealand Merino Company (NZM) and the Ministry of Primary Industries (MPI) is to create Wool Unleashed, or W3, in a seven-year $22.1 million programme that will derive greater value from NZ’s strong wool,” Justine Gilliland, Director Investment Programmes at MPI said.

“The programme has the potential to deliver significant benefits and transformation for the strong wool industry to capture value through the eyes of the consumer and respond to the declining profitability and volume trends,” Gilliland said.

NZM Chief Executive John Brakenridge said W3 would apply NZM’s experience with fine and mid-micron wool in establishing contracts with premium brand partners and developing new users and markets to strong wool.

NZM appear well placed to help improve the performance of the strong wool sector. In 2015 NZM realised a 21% profit increase from the previous year after undertaking a value-add strategy, switching from treating wool as a commodity.

NZM has already had success in directly engaging consumers with top clothing brands including Loro Piano and Red in Italy, New Zealand’s Icebreaker and Colorado-based SmartWool. It has also had success branching out into strong wool, securing a two-year contract with Danish footwear firm Glerups to supply NZ wool for its indoor shoe range.

To arrest the steady 25-year decline in the commodity wool market, the W3 programme will aim to ensure on-farm production practices align with consumer expectations of a premium product.

Brakenridge said the PGP programme would be delivered through four work streams, which would include a review of on-farm production practices, implementing a system that connects producers with markets, identifying and developing new wool products for niche markets, and collaborating across the primary sector to deliver cross-sector shared knowledge and practices.

The Government and industry will commit $11.05m each to the programme, with the estimated potential economic benefits to NZ reaching up to $335m by 2025.

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