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Beyond the Bale : Apr - May 08
MEC's requirements. So is Mr Dunbabin's emphasis on the practical rather than the cosmetic. "In terms of an overall production system, sustainability is about managing change;' Mr Dunbabin says. "Words such as 'organic' and 'chemical-free' make me nervous. If ticking boxes becomes your primary focus, then it's just a marketing ploy; you've also got to get the overall holistic management right:' He sees the longevity ofland ownership as an important factor: "The accumulation of knowledge is ongoing: how different areas respond to different events, such as which waters run out in a drought, how much grazing an area will support and so on. It is all built up from experience." The farm runs a self-replacing flock of 8000 fine-wool Merinos, annually producing 30,000 kilograms of 16.5 to 17.5 micron wool. In the past 10 years the breeding program has reduced the average micron by two and maintained wool cut per head, using home-grown rams bred with semen from the best-performing fine-wool sires in Australia. The majority of the clip is sold at auction in Launceston, and is bought by Italian and Japanese processors. Mr Dunbabin's aim is to produce high-quality fine wool and reduce reliance on the auction system, so some wool is channelled through the Roberts Wool Link program, which supplies directly to end users such as MEC. Not surprisingly, mulesing is a contentious issue for MEC. Here, the consideration is not necessarily one of best practice (on which MEC is open-minded) but the need to respond to the success of anti-mulesing campaigners who have created a perception in the global community that the practice is unacceptable. MEC's view is that producers looking for a premium for following best practices are likely to be disappointed because more and more markets are seeing this as the minimum requirement simply to remain a potential supplier. even in traditional wool-growing enterprises - due to good land stewardship of families who have run grazing operations on that land since sheep arrived in Tasmania 180 years ago - we have retention of native pasture species and responsible sustainable management of that environment. "Organic is a term which came from the food industry and, to me, it doesn't mean the same in wool production. We need to work out how we market and reward good land stewardship and best management practices in wool production." Complying with the EU Eco requirements and the robust Verification of Australian Merino (VAM) traceability system Eric believes Tasmanian woolgrowers are well placed to supply product to the 'mega' trend that is the environmentally aware consumer. To meet such markets, Eric sees the Australian wool industry as holding a piece of rope: it cannot be pushed, it can only be pulled. In his case, the rope is 'environmentally friendly' sustainable wool production, which can be marketed Eric Hutchinson to help retailers and designers answer consumer demands. "When those customers realise this is what they want and it fills the niche being created by consumers, that demand will come back down through the market. There is no point in us taking our natural Tasmanian wool to the top makers and the spinners and a:. w >- I I- <( U U w aJ w a:. Ö Õ I a... (From left) Tom Dunbabin,Tyrone Brett, Louise Gilfedder (a researcher with Tasmania's Department of Primary Industries and Water) and Cynthia Dunbabin discuss how certain species of native grass are better able to resist drought conditions. On the other hand, companies such as MEC are not necessarily looking for the cheapest wool. It finds it can compete with "lowest common denominator" competition through efficiencies created by its vertical structure, which to some extent can absorb additional best-practice costs. A major market of the outdoor-clothing industry for MEC has been the hiking and trekking baby boomers whose lifestyle, budgets and personal values have tended to favour natural products such as wool. Mr Brett sees the challenge for the future as appealing to a more radical, younger generation who, anecdotally, appear to be driving expectations of higher ethical practices. After Mr Brett and Mr Dunbabin met, the woolgrower said frank discussions between garment manufacturers and producers could only be positive because each was made aware of their respective needs and expectations. Roberts Ltd is also positive about the visit and has an MEC order pending. While the initial volume is hundreds rather than thousands of bales, MEC has hitherto relied on New Zealand suppliers, signalling the prospect of new opportunities for Australian producers in a position to meet the needs of this market. 0 More information: www.mec.ca telling them.They need orders from the next person in the value chain, and that will only happen when the end customer demands it:' From Roberts Ltd's perspective, Australian wool can be differentiated by the fact that traceability is simple and science-based and fibre can be linked straight back to the woolgrower.This is often an appealing marketing aspect which can 'seal the deal' when retailers and designers are learning about Australian Merino. "Take that retailer to meet Bill or Joe or George who grew the wool on a well-managed sustainable property and it all comes together as a package;' Eric says. Of the 400 to 500 woolgrowers in Tasmania, about 30 per cent use the EU Eco compliance system, while another 20 per cent, according to Roberts Ltd estimates, could easily reach compliance. "Change in an old industry such as wool is slow and is perhaps the reason production of wool in Tasmania has declined by 60 per cent in the past I 5 years;' Eric adds. "Hopefully, this new consumer-driven trend will help turn things around and woolgrowers are rewarded for the effort they have made to run sustainable wool production enterprises." - KELLIE PENFOLD More information: www. naturaltasmanianwool.com 15 MARKETING BEYOND THE BALE Web tool tal<es guesswork out of marketing As with many of his peers, the internet has become part of daily life for Victorian woolgrower Roger Strong and he regularly encourages his mates to take advantage of the online tools that he finds make business life easier - such as AWl's Woolcheque (www.woolcheque.com.au). "I often hear him ask people if they have discovered Woolcheque, and if they haven't he gives them a demonstration;' says his wife Jenny. Roger and Jenny, who run a self-replacing, 18-micron Merino flock based on 1400 ewes - down by 600 ewes due to successive dry years - have used Woolcheque for the past three years and consider it an essential decision-making tool in the marketing of their clip. The free program allows users to enter their current clip data to estimate its market value at current auction prices and to generate a worksheet using the AWEX auction database on their previously sold or offered lots. Prices are updated daily, based on the same pricing mechanism as the AWEX market reporting system. Roger says Woolcheque is very reliable. "All of the estimates for our most recent lots came within 10 cents of the actual price and the overall return was a difference of only $1000 from the Woolcheque estimate." The Strongs, who have grown wool at'Dropmore' in the Highlands-Ruffy region, near Seymour, for more than 50 years, say Woolcheque is part of a suite of advisory tools used to market their clip. "We've always had a good relationship with our wool broker, and with him and Woolcheque we can confidently make decisions on when to sell the wool, what reserves to put on it and what lines to hold back. "We tend to shear at three different times and we then either sell the clip all together or split it into two lots, depending on the market at the time. I would use Woolcheque every week over the shearing and marketing period to help with those decisions." Roger classes his own clip, and the historical data helps him with the decision making in the shed. "You can look at how different lines are selling and class accordingly;' he says. Woolcheque also features price charts, which put the calculated daily prices in perspective by displaying market prices over the previous 12 months for each lot and the whole clip - it displays prices for the actual lot specifications, not a generic chart of similar wools. There is also review information on each wool characteristic, current and historic trends and tips to improve wool returns. Worksheets created in Woolcheque can be saved to the user's own computer and then reloaded into Woolcheque to be repriced at any time without having to re enter the data. Attached to Woolcheque is a cost-of-production calculator to help growers establish the profit of their clip. - KELLIE PENFOLD More information: www.woolcheque.com.au
Feb - Mar 08
Jun - Jul 08 Supplement