Wool industry must unite to support China

Wool industry must unite to support China

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Roberts Ltd will next week present more than 5000 bales of premium wool to the Melbourne market.

Roberts Ltd will next week present more than 5000 bales of premium wool to the Melbourne market.

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It is essential that the impact of coronavirus on our export-focused industries is strategically managed over the coming weeks.

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It is essential that the impact of coronavirus on our export-focused industries is strategically managed over the coming weeks.

Roberts Ltd, now part of global agribusiness Nutrien Ag Solutions, will next week present more than 5000 bales of premium wool to the Melbourne market in one of the biggest offerings of Tasmanian wool in recent years.

There has been an overwhelming level of interest in this sale and we are delighted that a number of Tasmanian wool growers will be accompanying Roberts Ltd in Melbourne for the auction.

With China accounting for 80 per cent of Australia's wool exports, it is critical that we as an industry work collaboratively with buyers, exporters and China-based textile mills to support them during the current health crisis.

From my discussions with a number of wool buyers over the past couple of weeks, there is no doubt that the demand for wool from China is as strong as ever.

Last week we saw the market lose $1 a kilogram on the first day of trading, but rebounded strongly to see the Eastern Market Indicator close only 28 cents a kilogram down by week's end.

The top five exporters on the buyers' list were China focused.

And from our recent tour of mills around the Shanghai area as part of the launch of Roberts Ltd's new collaborative wool marketing brand, Natural Tasmanian Wool, I have never seen the level of investment and optimism in the wool sector as vibrant in more than 20 years of visiting China.

We saw no evidence of analysts' claims of stockpiles of greasy wool, semi-finished product or finished goods in warehouses.

Instead, we listened to mill owners talk of millions of dollars worth of investment into new plant and equipment, a commitment to sourcing additional Australian (and in particular Tasmanian) wool, and a willingness to pay a premium for fully traceable, and sustainably and ethically produced wool.

For our king Tasmanian wool sale next week, I remain cautiously optimistic as, while demand is strong, on-ground reality in the midst of a China business lockdown is tough.

I spoke to a senior logistics manager in Shanghai this week and she told me that the city was empty, banks were closed, buyers couldn't secure lines of credit, ports remained shut and transport companies had come to a halt.

But she also spoke of determination and innovation.

With schools closed, teachers are delivering their lessons online to students at home, and businesses are utilising home-bound managers to plan the resumption of trading.

This is not a time for alarmist headlines and doomsday predictions.

It is a time to be responsible, resourceful and respectful as the global community rallies to find a cure and minimise the spread of the virus.

It was extremely heartening to hear Tasmanian Premier Peter Gutwein this week say that the Tasmanian government will work hard to ensure the appropriate assistance would be provided to exporters to ensure markets can still be accessed.

And when coronavirus is declared under control, it is likely that we will see a fairly quick response in the market as mills resume operations, ports re-open and orders flow.

We need to be ready to respond.

In the meantime, we as an industry must come together to support our friends in China.

Our thoughts are with all people, families and businesses impacted by this virus

  • Stewart Raine is the Roberts Ltd state wool manager
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