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AWI suspends marketing during COVID lockdowns

Terry Sim, May 18, 2022

AWI chairman Jock Laurie at the superfine growers dinner at Ararat.

AUSTRALIAN Wool Innovation chairman Jock Laurie has assured growers the research, development and marketing body would be cautious in spending and not waste levy money on promotions during COVID lockdowns in China.

At the 50th anniversary Australian Superfine Wool Growers Association dinner on Saturday night, Mr Laurie said the COVID pandemic has given the organisation a clear understanding of where and how it needed to invest for growers.

“We’re not going to waste your money.

“We want to send a message to you we are not going to waste your money investing in projects that are not going to give us some sort of a kick in the market,” he said.

“If we go into a marketing campaign there is no point going into China and spending a fortune over there trying to build and promote wool when they can’t even get out of their houses.

“We want to make sure it is timely and we want to make sure what we are doing is good,” Mr Laurie said.

He said a lot of AWI’s research projects have been stymied to a certain extent because of COVID and the company was holding back programs until economies recovered.

“And that has also had an impact on the company and it has made it very difficult to actually meet a lot of timelines.

“But what we do know is that there is going to catch-up,” he said.

“When the economies do start to open again we are going to have to invest and invest heavily and so the money we’ve protected over a period of time now we will clearly targeting areas to invest that.

“We will be identifying the economies that are coming out first and trying to find ways to get back into there and make sure that wool is being clearly promoted in those areas.” Mr Laurie said.

“We will be shifting it away from areas where we don’t think there is a real advantage at the moment.”

AWI staff in China sent food packages

Mr Laurie said AWI over the last two years has been in a very difficult position due to COVID, with China’s no-COVID stance having a clear impact on wool garment sales and processing, as cities were locked down and economies closed.

Mr Laurie said throughout the pandemic up to 92pc of Australia’s wool was traded into China.

“When other sectors across the globe were really struggling China stepped up to the plate and took the wool, so it was tremendous to see that happen.”

Some AWI staff have also been locked up in their houses for up to 28-29 days and the company has had to provide food packages to some staff in China.

Post-COVID market direction not clear

Mr Laurie said the market landscape has changed with people going back into offices, but it is not clear how many days staff will be in their offices, or whether they will need suits or would dress casual or formal.

“We’re not exactly sure what is going to happen around the world, but what we know is that it is creating huge opportunities in other sectors — in the casual, leisure and knitwear sectors.

“We are doing a lot of product development to try and make sure that we can get back into those areas.”

Mr Laurie said AWI would continue to work on ways to build demand for wool.

“If don’t do it ourselves as an industry and we are not prepared to invest in our industry ourselves nobody else is and that

“We are going to be cautious about what we do, we are going to be cautious about our R&D spend and we want to focus very much our R&D on areas that are actually going to pay dividends on farm.

“So when we spend money we want to know that that’s actually going to go and provide a financial benefit or a management to our companies.”

He said shearing is a massive problem for and AWI had organised a field day at Conargo this week to demonstrate wool harvesting options.

“We’ve also got massive problems with worms and massive problems with fly chemicals.

“We are seeing Barbers Pole (worms) in many areas across New South Wales across the eastern seaboard at the moment that have never ever seen it before, that is starting to run into the same problems,” he said.

Mr Laurie said AWI would continue to train shearers, including Pacific Island workers when they came.

“If they come out under a government scheme, we will train them, we will support them and we’ll get as many as people in the program and back onto stands as we possibly can.”

Sustainability is a ‘top shelf’ issue

Mr Laurie said AWI chief executive officer John Roberts had just returned from overseas, where the carbon economy and carbon neutrality is an ongoing issue. He said there is a lot of work to be done on determining what the Australian red meat industry’s target to achieve carbon neutrality by 2030 meant for the wool industry.

Mr Laurie said all AWI’s managers are reporting that “everything that is coming out of COVID is related to sustainability and environmental issues.”

“People really want to know that everything they are buying is sustainable.

“They want to know that it is not having an impact on the environment and it’s coming back to the carbon footprint again,” he said.

“Sustainability has become a really really top of the shelf issue for everybody we are dealing with.

“We getting the same feedback from all of our managers internationally that it is number one,” Mr Laurie said.

He said everything that AWI does with wool marketing will now have the overarching element of sustainability.

“We’ve got to continue to develop more packages about that.”

Mr Laurie said wool as a natural fibre should be in an extremely strong position in regard to sustainability.

“But at the same time we are actually fighting and arguing in the European Parliament around what they call the Product Environmental Footprinting which basically labels wool as being more environmentally damaging than man-made fibres.”

“We are trying to get the European Parliament to not legislate that,” he said.

But Mr Laurie said AWI was having difficulty getting the textile industry and EU politicians to understand wool’s circularity, biodegradability and environmental credentials.

“Whenever you are at the mercy of politicians it’s a concern.

“I hope there are none in the room, but I’ve dealt with enough over the last 20 years to be able to confidently say ‘we should be running our own race, not necessarily being run by people who don’t understand what are doing’,” he said.

He said there were opportunities to convince communities about wool was “it” – a sustainable product – as well as in the sport, casual and safety wear sectors.

Mr Laurie said he was aware the superfine wool growers in the room produced “the best that you can buy anywhere in the world”, but AWI also had to sell the mid-micron and crossbred wool.

“We need to do it across all the micron ranges and the pressure is in all those micron ranges.”

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Comments

  1. Jim Gordon, May 19, 2022

    Mr Laurie, please, not going to waste levy payers money – what planet are you on? You have got to be joking with a statement like that. That is the only thing AWI is good at, wasting levies. For example, $60 million on fly prevention and the flies are getting worse not better.
    Why is Stuart McCullough still on the payroll? Senator McKenzie needs to have a look at this.
    Spend our money educating the wool grower to produce what the market wants. Don’t spend our levies trying to convince the end-user to take wool they don’t want.
    Wool will sell itself if we produce what the market wants: quality, non-mulesed, with full traceability and sustainable. Stiffer fine crimping wool for the Italian suits and 100 percent comfort for the next-to-skin wear. Everything over 19 micron is not so serious – outer garments. Get rid of everyone in AWI that won’t back this 100 percent.
    AWI has to have a major change in attitude and stop paying everyone that is backing the production of wool that the market doesn’t really want.
    With no new fly prevention chemicals and the chemicals we’ve got running out of steam, if you don’t back the easy care Merino we won’t have an industry.
    You don’t have to tell growers what to do; however, AWI can back the type of Merino that will keep growers and shearers in the industry. Not the type that is driving growers to other breeds at 100 kms per hour.

  2. Russell Coad, May 18, 2022

    Wowee, so AWI is finally aware that COVID is rampant in China. Hasn’t this been the case for at least more than two years?

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