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Where have the sheep gone and what does it mean for NZ?

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Fuseworks Media
Fuseworks Media

In the early 1980s there were around 70 million sheep in New Zealand and 3.1 million people - that’s 22 sheep for every Kiwi. A comparison with today provides a stark contrast - around 30 million sheep and 4.5 million people - or six sheep for every New Zealander.

Where have the sheep gone and what does it mean for New Zealand?

At a basic level the output of sheep farming is twofold - meat and wool. Cedric Bayly, General Manager of PGG Wrightson Wool, has been involved in the wool industry for more than 40 years and offers some perspectives on the challenges and opportunities facing sheep farmers.

When and why did you get involved in the wool industry?

I grew up on a sheep farm in Hunterville and wanted to be a farmer but there weren’t the opportunities so I went to Massey and did a Wool Diploma and started work with Williams and Kettle as a skippy, working with the Wool Classers. I gradually worked my way through all aspects of the business from when the wool arrives in store, to when it goes to the processors.

Sheep numbers peaked in the 1980s and declined gradually as prices for meat and wool fluctuated and farmers diversified into other more profitable areas of agriculture like dairying. There were a number of company mergers over the years as the industry restructured and I was fortunate to get a lot of opportunities to continue my connection with farmers and the wider wool industry.

How does demand for wool today compare with, say, 20 years ago?

The biggest competition has come from synthetic fibres (like nylon) which competes with wool on two fronts - price, colour and texture - but isn’t on the same playing field when it comes to how these materials impact on our health and wellbeing.

What are the health benefits which wool has over synthetics?

Wool is the perfect fibre - it’s fire resistant, renewable, cleanses the air by absorbing chemicals, is bio-degradeable so it’s good for the environment, absorbs carbon and doesn’t break down in the sun. You’ll only see woolen carpets on trains and planes - because of its fire retardant/safety properties over synthetic alternatives.

Consumers intrinsically know that wool is a premium product for carpets, apparel, suitings and interior textiles but price wins out.

What are the challenges?

For the farmer it’s providing them with certainty of income, and for the consumer it’s providing them with knowledge which will guide their purchase decisions.

When I first got into the industry the wool cheque was the chief form of income on the farm - now it’s the meat cheque. That has driven a reduction in the numbers of capital stock ie ewes producing wool and lambs.

Our role, at PGG Wrightson Wool, is to work with wool growers and come up with innovative packages which’ll give them more certainty of income and markets - and we’re doing that.

What are some of the things PGG Wrightson is doing to meet the challenges wool growers are facing?

Fixed Price Contracts

Traditionally growers wouldn’t know the price of their wool until it was sold. Our closeness with overseas manufacturers, processors and retailers means we can anticipate demand and pull that business through to our clients, connecting them with overseas customers and giving them a fixed price so they know - in advance - what they’re going to earn. Growers can opt for a fixed price over a variety of terms from 6 months to three years with premiums built in.

More farmers are taking up the fixed price, putting half the clip in and leaving the balance for the spot market so they can average up or down. It’s a win-win for our growers and our overseas clients because the farmers know what they’re going to get paid and the customers know what they’re going to pay.

New markets

PGG Wrightson has developed an exclusive integrity assured programme which gives manufacturers and processors the reassurance they want on where and how the product was grown eg how the animals were cared for, the environment in which they were kept and how the wool was collected and processed. Overseas clients want to know that animals are not being mistreated, they want to understand the shearing process etc and we’re the only broker in New Zealand which can do that.

Innovative products

Relationships with clients are everything, doing a good job, helping farmers, adding value. The role of our field force is to work closely with growers, understanding the type of wool they produce and linking them to markets with a demand for that product.

We’ve got agents around the world forging relationships and demand from traditional and new markets - carpets and textiles but also specialist areas like Persian carpets, yarn making and tennis balls! The best tennis balls in the world - used in tournaments at New York, Wimbleton and Melbourne - are made out of wool sourced from PGG Wrightson Wool.

More recently we are opening doors to the users of fine and mid micron types for use in the active outdoor apparels for use in America and bedding and suits for Japan.

These are just a few of the initiatives we’ve taken in recent times to answer the challenges faced by our growers but it’s ongoing. We’ve got the biggest team of wool representatives on the ground in New Zealand and they’re out there working with farmers on a daily basis helping them achieve their farming goals.

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