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Higg decision gives lift to new AWI three-year strategic plan

Terry Sim, July 1, 2022

AWI CEO John Roberts.

AUSTRALIAN WOOL Innovation’s new strategic plan for the next three years has been given a boost with action on the Higg Index labelling system that has favoured man-made fibres over wool in garments.

The Norwegian Consumer Authority recently outed the use of the Sustainable Apparel Coalition’s Higg Index ‘sustainability profiles’ on clothing labels as greenwashing and contravening Norway’s Marketing Control Act, putting the use of the environmental impact measure under a global cloud.

The Norwegian action has prompted the SAC to pause use of the index globally, offering hope to the wool industry’s fight to change how the index and the European Union’s Product Environmental Footprint methodology compared and rated natural and man-made fibres for sustainability.

Click here to read the Sustainable Apparel Coalition’s statements re the Norwegian Consumer Authority and environmental claims.

Click here for more information about the Higg Index.

AWI strategic plan has sustainability as key priority

The new AWI strategic plan has set goals of increasing wool demand, price and productivity and positioning Australian wool as the sustainable natural, renewable and biodegradable fibre of choice.

One of strategic plan’s key performance indicator is an improved PEF methodology more favourable to wool, with the inclusion of missing elements such as microplastics, renewability, biodegradability and non-physical durability.

The EU has targeted the textile sector to improve its environmental footprint, with the intention of mandating the labelling of clothing to show the size of that footprint through a system that is developed by the EU. Australian wool growers have been told by AWI that the global wool industry has serious concerns that the PEF methodology being proposed will disadvantage all natural fibres, especially products made from animal fibres. AWI has been working through legal avenues as well as undertaking a scientific review of the PEF methodology’s shortcomings.

AWI chief executive officer John Roberts said the Higg Index development is an opportunity and a breakthrough.

“Given that the Higg Index was going to be some of the underlying framework behind the PEF methodology that the Sustainable Apparel Coalition is forming up, the fact that they now have to put that on hold and review the effectiveness of it, suggest they are goinbg to have to decide whether it (the index) was serving its purpose, which is to allow consumers to make informed decisions about the eco-credentials of a product.

“The suggestion that the current system is greenwashing means that they are going to have to go back to the drawing board.”

After the Norwegian action against the Higg Index, International Wool Textile Organisation secretary general Dalena White told Sheep Central:

“It looks like the need for transparency in textile supply chains, topped with the overwhelming evidence of microplastic pollution causing long-term health issues, have put the focus on how we are going to define ‘sustainable textiles’ in future.”

International wool processor Giovanni Schneider said the IWTO is doing amazing work supporting wool with great support from AWI.

“It is really important that people in Australia understand the importance of the world that our institutions are doing to protect the wool industry,” he said.

Strategic plan represents a refocussing of AWI

Mr Roberts said the new strategic plan represented a refocussing of AWI’s activities.

“Refreshment and rejuvenation is always required in any business and that’s exactly what this is about.”

The AWI strategic plan’s key priorities include growing the value and international demand for wool; wool harvesting; collaboration, consultation and engagement; sustainability and strengthening the supply chain.

Other key performance indicators include the gross value of wool GVP to $4.46billion by 2030, maintain or increase the number of producers with ewe flock growth intentions from 37pc and measure the competing fibre use of percentage of wool against other fibres.

Mr Roberts said the new strategic plan has been informed more inclusively by input from the Wool Industry Consultative Panel and the Woolgrower Consultation Group.

Mr Roberts said the value of wool to consumers is growing.

“I think people are starting to understand that purchasing a wool or natural fibre garment serves a number of purposes.

“One it is more sustainable purchase and probably last longer, it aligns with the movement away from high consumerism and high turnover and leaning towards that buy-once buy-well philosophy,” he said.

He said pre-COVID when the Eastern Market Indicator was around 2100c/kg clean, it was clear that demand for natural fibres like wool had finally outstripped supply.

“I think those fundamentals haven’t probably changed that much and we are just getting back to where we were, and wool from a brand’s point of view is probably still pretty good value.”

He agreed that wool prices would be higher if not for the logistics and COVID lockdowns in China.

“I think it could be a lot dearer, it could 50 cents dearer or even more than that.”

Mr Roberts said wool harvesting has always been a priority for AWI, even before the recent crisis period. AWI’s recent $1.4 million commitment in chemical defleecing if successful would be a real gamechanger, he said. The levy-funded company would continue to invest in alternative methods of shearing and training of shearers and wool handlers, although robotic shearing is not ruled out as an option in the long-term, he said.

“An easing of the (overseas worker) visa situation would be nice, we’ve got plenty of trainers, we can train them,” he said.

Mr Roberts said the inclusion of ‘collaboration, consultation and engagement’ as a key priority is important and underpinned all other priorities. The listing of ‘sustainability’ as a priority reflected AWI’s recognition that it represented “futureproofing” the industry,” he said.

“We are just acknowledging what’s coming our way and making sure that we have sustainable practices that are agreeable for our farmers, but also for our overseas consumers.”

The ‘Strengthening the supply chain’ priority included broadening market access, he said.

“We know we’ve got a bottleneck in early stage processing and we know we need to look at other markets to do scouring and combing and reduce our dependency on one single market.

“But also in the knitting, weaving and dyeing sectors, it is about making sure that getting other people that want to incorporate wool into their collection, can do that and have the machinery to do it,” he said.

“The other part of that is the traceability piece, which is also a futureproofing piece, because we think that if you want to talk about sustainability or make sustainability claims, you’ve got to validate them.

“If wool is going to still remain relevant, we’ve got to be able to validate the claims that we make and we’ve got to do that by having traceability.”

Click here to to read the AWI Strategic Plan 2022-2025

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