CONTRACT price premiums have never been higher for sustainably produced traditional superfine Merino wool accredited under New England Wool’s SustainaWOOL Integrity Scheme, NEW managing director Andrew Blanch said.
The SustainaWOOL Integrity Scheme promotes high animal welfare and environmental practices and it underpins NEW grower contracts, including the latest July-December 2017 ‘Bring Back The Premium’ contract on behalf of Italian companies Reda and Vitale Barberis Canonico, which was filled just eight days after its release.
To secure supplies traditional superfine Merino fleece and to promote the very best growers, premiums in the latest NEW ‘Bring Back The Premium’ contract for suitable super spinners 17 micron wool from accredited SustainaWOOL non-mulesed flocks were upto 594c/kg clean above market rates.
Premiums for super spinners 17 micron wool from sheep mulesed with pain relief by accredited SustainaWOOL growers range up to 481c/kg clean above market rates, Mr Blanch said.
“Certainly in the time we’ve been doing contracts and we started about 10 years ago, it’s never been this high, the prices offered in this contract have never been this high,” Mr Blanch said.
For the first time in the five-year history of the BBTP contract, the physical market actually lifted to the same, and in some cases over, the contract prices in January-June 2017.
“There is a premium for the right sort of wool, if you are part of the (SustainaWOOL) scheme,” Mr Blanch said.
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In the latest BBTP for 12oo bales, growers producing traditional fine crimping 74-80s count 15.8 to 19 microns wool from non-mulesed sheep or those mulesed with pain relief within NEW’s SustainaWOOL Integrity Scheme were offered market premiums. The contract is not for bolder crimping or SRS type superfine wools.
Depending on top-making and spinning style types, the latest BBTP contract offered premiums of 4-25 percent above the market for SustainaWOOL Blue (pain relief) accredited wool and a further 4pc premium above listed contract prices for all suitable from SustainaWOOL Green (non mulesed or ceased mulesing) wool.
The premium percentages meant that, depending on the type, suitable 17 micron SustainaWOOL Blue wool was eligible for price premiums of 216-746c/kg clean above market rates and SustainaWOOL Green wool of the same diameter could attract premiums of 94-870c/kg above recent auction prices.
The pricing in the BBTP contract is aimed at encouraging production of 17-19 micron NEWool ‘FT’ (Spinners) type wool which involves the removal of all backs and necks from fleeces.
Although, non-mulesed premiums have always existed for growers in the SustainaWOOL scheme, Mr Blanch said it was decided to clearly delineate the non-mulesed premium in the Bring Back The Premium contract.
“We want to keep that traditional side going, both our companies are looking for more wool and the only way we can do that is through close contact with the very best wool growers and offering these contracts and incentives.
“The wool must be right, that is first and foremost,” he said.
“But we do have this requirement from some brands who want to access non-mulesed wool.”
Unlike in contracts, Mr Blanch it has never been easy to see premiums for non-mulesed wool in the auction system because everyone values wool differently and there are so many types.
“In the auction system it has been there for a couple of years on certain types, but the wool has got to be right first.”
BBTP type percentage and price premiums
ZX – Best/Good top making style (the backs and necks removed from preparation of a traditional clip) – generally same as closing market. (+4% if SustainaWOOL GREEN NM/CM accredited properties)
KB – Best topmaking style (backs and necks removed where needed) – 10% above the market (+14% if SustainaWOOL GREEN NM/CM accredited properties)
FT – Spinners style (all backs and necks removed) – 18% above the market (+22% if SustainaWOOL GREEN NM/CM accredited properties)
YA – Super spinners (all backs and necks removed) – 25% above the market (+29% if SustainaWOOL GREEN NM/CM accredited properties)
For 17 micron wool – Premiums SW BLUE (PR farms) / SW GREEN (NM/CM farms)
If ZX = SW BLUE +$0/kg clean / SW Green +$0.94/kg clean
If KB = SW BLUE +$2.16/kg clean / SW GREEN +$3.19/kg clean
If FT = SW BLUE +$4.81/kg clean / SW GREEN +$5.94/kg clean
If YA = SW BLUE +$7.46/kg clean / SW GREEN +$8.70/kg clean
Source: New England Wool.