Saturday, April 20, 2024

Penny-pinching is hurting wool

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Farmers can’t complain about being short-changed by the market for top-quality wool unless they’re making sure that’s what they’re delivering, Otago wool sector leader Simon McAtamney says.
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Those farmers cutting back on shed handling costs at shearing time are likely to be doing more harm than good to their prospects.

“If you’re cutting down on the number of shed hands to save money I’d say you’re not saving money and you’re probably doing damage for the future by driving away skills the industry needs.

“Farmers are disgruntled about the falling value of their clip but this sort of action is just reactionary,” he said.

They might save 10c to 15c/kg (depending on volumes) on the costs of an extra shed hand but if they worked hard at getting their full-fleece sorted in very good order and good colour they could get an extra 50c/kg at sale time.

Evidence is that farmers are cutting down on shed hand numbers for wool preparation after shearing.

McAtamney, chairman of Otago Federated Farmers meat and wool and part of the national wool group, says there should be one shed hand for each shearer.

He’s hearing of three-man shearing teams being asked by farmers to go with just two helpers or even one for the preparation and getting fleece into the woolsack.

And he’s heard the practice is more common in the North Island but his own shearing contractor in south Otago told him farmers down that way are also looking to save costs.

When they miss out on work some and shed hands end up going to Australia or further afield and not coming back.

That has the potential to do long-term damage to the industry.

“The question should not be can you afford to have fewer shed staff but can you afford not to have them in full numbers,” McAtamney said.

Shearing is also about wool management and animal health.

Crossbred wool prices “are still riding along the bottom” with recent price increases adding only marginal value.

High lamb and mutton schedules this season meant most farmers would be in a good financial position despite very dry conditions so they could afford the cost of doing the shearing properly.

“Saying that might annoy some people but it’s true.

“We’ve been hammered by the dry here in south Otago but financially we’re still doing well.”

Plenty of recent rain means the impact of the dry spell should not be felt beyond the current season.

A lot of farmers stored big volumes of wool last year rather than sell on a weak market but McAtamney took the approach of selling his wool straight away.

“The price wasn’t going anywhere and if you sold the wool fresh you didn’t risk deterioration in storage and getting paid less if it was more yellow than white.”

More farmers now appear to be taking the pragmatic approach of putting their wool into the market and meeting the prices being paid, he said.

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