Wool exporters also voice lack of agreement on Wool Exchange Portal

Terry Sim, November 3, 2017

AUSTRALIA’S wool exporters have joined brokers in voicing concerns at purported “unanimous” agreement that Australian Wool Innovation’s Wool Exchange Portal project proceed.

Australian Council of Wool Exporters and Processors president Matthew Hand said AWI chairman Wal Merriman’s recent statement that brokers, buyers and growers unanimously agree that the WEP proceed is not correct from ACWEP’s perspective.

Mr Merriman’s made his WEP support statement in a personal letter to AWI shareholders last week, supporting his preferred candidates in the current AWI board election. The National Council of Wool Selling Brokers of Australia last week also refuted they agreed the WEP should proceed.

Mr Hand said exporters understood that the WEP would, in its first iteration, be an information hub for wool growers.

“Our association understands the potential value of such a development, provided that it does not become a point of unauthorized access to confidential commercial information.”

But he said ACWEP does have sincere grower-based concerns beyond this stage.

“We are yet to fully learn how it is ultimately intended to operate and where any significant cost benefits or market gains will be achieved.

“In this respect we also see significant benefits can be gained by closer collaboration between AWI, AWTA and AWEX,” he said.

“If the ultimate aim is deliver cost benefits to the industry and increase ‘competitive tension’, elimination of cost duplication throughout the pipeline will benefit investors.”

Mr Hand said the bulletin board concept of offering wool for sale is not new and operates with limited support on a number of Australian-based platforms. It has also been in place in China for a short time, although doubtfully inspired by the proposed WEP, he said.

Mr Merriman also claimed that a Chinese company Red Sun was “building a complementary portal”, but Mr Hand said ACWEP had been advised that the processor was not doing this.

“As we have previously stated, exporters and processors are the first entity to purchase and finance wool, fund the initial transaction, safely deliver growers’ wool to combers, spinners, knitters and weavers reaching garment producers and fashion labels throughout the globe.

“If a WEP becomes our first point of access, we will continue to perform the same functions,” Mr Hand said.

“We only ask that we are consulted and that we have significant involvement in further development of the WEP to ensure that the key “first transaction” happens securely, ensuring Australian wool growers can continue to be rewarded for their long-term commitment to producing this special fibre.”

Mr Hand also said AWI can certainly be proud to be among the researchers, manufacturers and marketing teams that have enabled production of a far wider range of garments with strong consumer appeal; active wear, sportswear, high fashion items, next to skin apparel.

“However, it’s perhaps a little arrogant for any individual organisation to claim price rises are a direct result of their work alone.”

Mr Hand said ACWEP was aware of commentary regarding the eligibility or suitability of different AWI board candidates in the media.

“It is our opinion that for an investment of this level it is fair that wool growers expect a board of directors consisting of individuals with unconditional eligibility and who collectively possess a supreme depth and breadth of industry knowledge.”

In a comment on the Sheep Central website this week, a former WEP Working Group member, Victorian wool grower Ron Lawrance, defended Wal Merriman’s statement of unanimous support for the WEP.

“At the WEP meeting held earlier this year, prior to submission to the AWI board, there was unanimous support; zero members voted against the motion and none abstained.

“This is recorded in the minutes of the meeting. This meeting included members of AWEX, as well as brokers, exporters, growers and the AWTA,” he said.

Click here to read Mr Merriman’s letter.

Click here to read the full ACWEP statement.


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  1. Peter Small, November 5, 2017

    The letter to wool growers by the chairman of AWI Wal Merriman, has provided an excellent insight into the thinking of Mr Merriman and his current board on many issues, not withstanding serving as an excellent catalyst for the brokers and the exporters to come out and state their position on the Wool Exchange Portal.
    Mr Merriman’s letter also puts the spot light on Rob Lawrance’s often quoted assertion, that there is unanimous industry support for the Wool Exchange Portal. Mr Lawrance, an AWI-anointed wool grower representative on the wool portal committee would be well advised in future to consult more widely before making such assertions. Even the wool growers he purports to represent do not unanimously support the wool exchange portal. I would suggest to Mr Lawrance that if he wishes to represent industry views on such an industry committee, he should consult widely with brokers, exporters and his fellow growers.
    It is indeed unwise to depend on advice from an enthusiast experienced in the electronic exchange of financial instruments on the financial market when it comes to the exchange of a luxury textile fibre, like wool.
    Mr Merriman’s letter highlights the need for growers to vote for the Don McDonald ticket, which includes Paul Cocking and Colette Garnsey for the AWI elections. We need people who understand the intricacies of our industry and have the courage to stand up to a chairman many hope would just go away.

  2. Martin Oppenheimer, November 3, 2017

    Looks like Merriman has told porkies to shareholders again.

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