NSW Wool industry & future opportunities

20 Pages·2015·0.86 MB·English

Published by the NSW Department of Primary Industries
SYNOPSIS
NSW WOOL INDUSTRY AND FUTURE OPPORTUNITIES
A report to the NSW Department of Primary Industries
from Miracle Dog, Poimena Analysis, Scott Williams Consulting and DAFWA
First published February 2015
ISBN 978-1-74256-717-4
www.dpi.nsw.gov.au AUTHORS
Russell Pattinson - Miracle Dog
Chris Wilcox - Poimena Analysis
ACKNOWLEDGMENTS
Scott Williams - Scott Williams Consulting
© State of New South Wales through the Department of Trade and Investment, Regional
Kimbal Curtis - Department of Agriculture
Infrastructure and Services, 2015. You may copy, distribute and otherwise freely deal
and Food Western Australia
with this publication for any purpose, provided that you attribute the NSW Department
of Primary Industries as the owner.
Disclaimer: The information contained in this publication is based on knowledge and
PHOTOS COURTESY OF SHEEPCONNECT
understanding at the time of writing (January 2015). However, because of advances in
NSW - a project of Australian Wool
knowledge, users are reminded of the need to ensure that information upon which they
rely is up to date and to check currency of the information with the appropriate offcer Innovation Limited and NSW Department
of the Department of Primary Industries or the user’s independent adviser. of Primary Industries.
JTN 13402
NSW WOOL INDUSTRY
& FUTURE OPPORTUNITIES SYNOPSIS
TABLE OF CONTENTS
THE CONSULTANTS ................................................................................................................................................... 6
INTRODUCTION ................................................................................................................................................................ 7
THE WOOL INDUSTRY IN 202 5 ............................................................................................................................................... 7
A SUCCESSFUL PRODUCER IN 202 5 ................................................................................................................................. 9
FINDINGS .......................................................................................................................................................................................... 1 0
RECOMMENDATIONS ............................................................................................................................................ 1 2
OVERARCHING RECOMMENDATION FOR ALL STAKEHOLDERS ............................................................. 1 2
RECOMMENDATIONS FOR NSW WOOL PRODUCERS ........................................................................................ 1 2
RECOMMENDATIONS FOR THE NSW WOOL INDUSTRY ................................................................................. 1 4
RECOMMENDATIONS FOR THE NSW DEPARTMENT OF PRIMARY INDUSTRIES .................... 1 7
A REPORT TO THE NSW DEPARTMENT OF PRIMARY INDUSTRIES
FROM MIRACLE DOG, POIMENA ANALYSIS, SCOTT WILLIAMS CONSULTING AND DAFWA
To the reader,
The wool industry has been a signifcant part of the NSW society and economy since
the early days of the colony. Over the past ten years we have seen a number of changes
and challenges that have been impacting on the proftability of wool growers. This has
coincided with drought, changes associated with the global fnancial crisis and the rise in
the importance of income from the meat component of a sheep enterprise.
It is little wonder that this has left NSW Department of Primary Industries, on behalf of the
IAN ROGAN
State Government, questioning how it can best assist wool producers and the NSW wool
Independent Chair
Project Steering Committee
industry in order to bring about improved economic viability. To help answer this question
NSW DPI commissioned an independent report into the State’s wool industry to:
» Understand potential future directions of the industry
» Identify opportunities and challenges
» Make recommendations for future actions to:
– NSW Producers
– NSW Wool Industry
– NSW Department of Primary Industries
The project steering committee has been delighted and challenged with the information
that has come forward from the consultants. They have collated and analysed information
and trends from both on-farm and off-farm aspects of the wool industry and then linked
that analysis together to present their recommendations.
NSW Department of Primary Industries is now seeking producers’ and industry’s views
on the importance and weighting of the recommendations for actions by NSW DPI and
others. I would encourage both wool producers and industry organisations to look at,
question and embrace the report’s recommendations for the future health and economic
strength of this great industry.
Yours sincerely
Ian Rogan
Independent Chair – Project Steering Committee
4
NSW WOOL INDUSTRY
& FUTURE OPPORTUNITIES SYNOPSIS
THE R E A R E M ANHEYR IEN DAIRVID U AE L M ANY INDIVIDUAL
OWOOL ENOTE RPLRI ESNES T TH ATERPRISES THTA
A RE PERO DUPCTIV E ANR D ODUCTIVE AND
PROROFIABT L E . T HIFSI STTOABLRYE . THIS STORY
IS N NOOT W E L L KNT OWWNE ANL DL KNOWN AND
NEDSE TOD B E TOSLD TO BE TOLD
A REPORT TO THE NSW DEPARTMENT OF PRIM ARY INDUSTRIES 5
F ROM MI R A C L E DO,G POIM ENA ANYAL SIS, SCOT T WI L LI A MS CONSTUIL NG AND D A F W A
THE CONSULTANTS
Russell has had a long association with the wool industry, both working in industry
organisations and as a consultant. Prior to 2001 he was Group Manager, On Farm R&D for
the Australian Wool Research and Promotion Organisation (AWRAP) and Group Manager,
Australasian Operations for The Woolmark Company.
Since that time through his successful consultancy frm “Miracle Dog” Russell has
delivered over 85 projects across most Australian agricultural sectors. He is currently
Chair of AWI’s Australian Wool Production Forecasting Committee and Chair of AWEX’s
RUSSELL PATTINSON Industry Services Advisory Committee.
Miracle Dog Pty Ltd
Scott has had a long association with the Australian wool industry and was an R&D Program
Manager, Australian Wool Innovation (AWI) and its predecessors from 1997 to 2006.
With a veterinary and farm consulting background he brings signifcant skills in the
areas of grazing animal health, welfare and production, R&D management and strategic
planning, particularly in the area of strategic foresight. With over 80 projects since 2006
Scott has a proven history in adding value across a number of agricultural industries.
SCOTT WILLIAMS
Scott Williams Consulting Pty Ltd
With over 20 years’ experience delivering proven results in economic research, market
intelligence, analysis and strategic assessment of key issues in the global wool industry,
Chris is recognised as the world’s leading analyst and commentator on the global wool
industry. He is currently Chairman of the International Wool Textile Organisation’s Market
Intelligence Committee, Executive Director of the National Council of Wool Selling
Brokers of Australia, and a Director of the Board of the Australian Wool Testing Authority.
In addition, he prepares the International Wool Textile Organisation’s annual Market
CHRIS WILCOX Information statistics publication.
Poimena Analysis
Kimbal has built a reputation as one of the leading livestock industry demographic
analysts and modellers in Australia during his 30 year period working for DAFWA. His
extensive experience began with work on wool and sheep production systems before
progressing to scoping, developing and maintaining fock models of the Australian
and Western Australian sheep industries. He has successfully undertaken, on behalf
of DAFWA, AWI, MLA and the Sheep CRC, some 25 market research projects aimed at
collecting current data from primary producers with a mix of state and national coverage.
KIMBAL CURTIS
Department of Agriculture and
Food, Western Australia (DAFWA)
6
NSW WOOL INDUSTRY
& FUTURE OPPORTUNITIES SYNOPSIS
INTROD U C TION
The pu r p s o e f o t h i s r e p o r t i s t o i n v e s t i g t e a t h e o p p o r u t n i t i e s a n d c h a l l e e n s g t h t a d o a n d w i l l f a c e t h e
w o o l i n d u s t r y i n NSW an d t o r e c o m m e n d t o p r o d u c e r s , i n d u s t r y a n d t h e NSW De p a r t m e n t f o Prim a r y
Ind u s t r i e s t h e a c t i o n s t h t a w i l l a l l o w t h s o e o p p o r u t n i t i e s t o b e e m b a r c e d .
THE PROCESS
This re v i e w w a s d e v e l o p e d b y i n i t i a l l y u n d e r t a k i n g a b r i e f b u t w i d e - a r n g i n g s i u t t a i o n a n a l y s i s f o
t h e NSW wo o l i n d u . s tPr y o te n t i a l t r e n d s a n d i m p l i c t a i o n s f o t h e s e w e r e d e s c r i b e d a n d a s e r i e s
f o f o u r s h o r t s c e n a r i s o f o h o w t h e NSW wo o l i n d u s t r y m i g h t l o o k i n 2 0 2 5 w e r e d e v e l o p e d .
A c o n s u l t t a i o n p a p e r w a s t h e n p r e p a r e d a n d s e n t t o 1 7 x e p e r i e n c e d i n d u s t r y p a r t i c i p a n t s
w h o w e r e s u s b e q u e n t l y i n t e r v i e w e d a n d t h e i r r e s p o n s e s c o l l e c t e d . T h e o u t c o m e s f o t h e
c o n s u l t t a i o n s w e r e h i g h l y i n � u e n t i a l i n d e v e l o p i n g t h e k e y � n d i n g s a n d r e c o m m e n d t a i o n s
w i t h i n t h i s r e p o r t .
T h i s s y n o s p i s i s a c o n c i s e o u t l i n e f o t h e r e p o r t , d e s i g n e d t o h e l p t h e r e a d e r u n d e r s t a n d i t s
m a j o r p o i n t s . T h e f u l l r e p o r t a n d i t s s u p p o r t i n g d o c u m e n t s a r e v a a i l a b l e o n r e q u e s t o r t h r o u g h
. a u d w p . o i g . v . n w s w w
T H E WOOL IND UST RY IN 2 0 2 5
W h t a m i g h t t h e NSW wo o l i n d u s t r y l o o k l i k e i n 2 0 , 2 5 a n d h o w s h o u l d p r o d u c e r s , i n d u s t r y a n d
o g v e r n m e n t b e s t r e s p o n d t o a d d r e s s c h a l l e e n s g a n d e m b a r c e o p p o r u t n i t i e s ?
Ind u s t r i e s c a n b e p f r o o u n d l y a l t e r e d e v e n o v e r t e n y e a r s m a k i n g t h e f u u t r e d i f � c u l t t o p r e d i c t .
, t H h o e w e v e r a n a l y s i s s t r o n g l y s u e g s g t s t h t a i n 2 0 2 5 t h e w o o l i n d u s t r y w i l l b e s h a p e d b y t h e
f o l l o w i n g k e y f o r c e s :
» Price p r e s s u r e s f r o m r e t a i l b a c k t o t h e p r o d u c e r w i l l r e m a i n i n t e n s e – t h t a i s , p r o d u c e r s ’
t e r m s f o t a r d e w i l l c o n t i n u e t o t i g h t e n
» Produ c t i o n c o n d i t i o n s w i l l b e m o r e v a r i a b l e a s c l i m t e a c h a e n g t a k e s h o l d
» The t r e n d t o w a r d s c a s u a l i s t a i o n i n c o n s u m e r m a r k e t s w i l l c o n t i n u , e s h i f t i n g d e m a n d w y a a
f r o m s o m e f o w o o l ’ s t a r d i t i o n a l m a r k e t s e g m e n t s a n d t o w a r d s o t h e r p r o d u c t s , n o t a b l y i n
a c t i v e - l e i s u r e w e a r a n d k n i t w e a r
» Produ c t , q p u r o a v le in ta yn c e a n d s u s t a i n a b i l i t y w i l l a s s u m e i n c r e a s i n g i m p o r t a n c , e a s
w i l l a n i m a l w e l f a r e a n d e t h i c a l p r o d u c t i o n p a r c t i c e s , w h i c h w i l l b e r e q u i r e d t o m a i n t a i n
i n d u s t r y ’ s s o c i a l l i c e n c e t o o p t e e a r
» Dem a n d f o r s h e e p - m e t a w i l l c o n t i n u, e p ta o r g r o w t i c u l a r l y f r o m x e p o r t m a r k e t s
A REPORT TO THE NSW DEPARTMENT OF PRIM ARY INDUSTRIES 7
F ROM MI R A C L E DO,G POIM ENA ANYAL SIS, SCOT T WI L LI A MS CONSTUIL NG AND D A F W A
325
KEY
300
1979 / 80
1989 / 90
275
1999 / 00
250 2009 / 10
2013 / 14
225 2014 / 15f
mkg greasy
200
175
150
125
100
75
50
25
NSW VIC WA SA QLD TAS
FIGURE 1
Australian wool production by micron
500
KEY
450
1991 / 92
400
1999 / 00
2009 / 10
350 2013 / 14
2014 / 15f
300
mkg greasy
250
200
150
100
50
0
<18.5 micron 19-20 micron 21-24 micron 25-28 micron >28.5 micron
FIGURE 2
Australian wool production by state
325
KEY
300
1979 / 80
1989 / 90
275
1999 / 00
250 2009 / 10
2013 / 14
225 2014 / 15f
mkg greasy
200
175
150
125
100
75
50
25
NSW VIC WA SA QLD TAS
8
500
KEY
450
1991 / 92
400
1999 / 00
2009 / 10
350 2013 / 14
2014 / 15f
300
mkg greasy
250
200
150
100
50
0
<18.5 micron 19-20 micron 21-24 micron 25-28 micron >28.5 micron
0
0
NSW WOOL INDUSTRY
NSW IWS T H E L A R G ESIS T THE LARGEST
& FUTURE OPPORTUNITIES SYNOPSIS
OWOOL POROLDU CI PNRG S OTEA .T DUCING STTA E .
IF FIT W E R E A CO ITUN WTRY IE T RE A COUNTRY IT
OWULD B E T H EO OW URL D ’S LD BE THE WORLD’S
FOOURT H - L A R G ESUT SRUPTPH-LIE R ARGEST SUPPLIER
A SU C C ESSF U L PROD U C E R IN 2 0 2 5
T h e � n d i n g s f o t h e r e p o r t s u e g s g t t h t a i n a d e c a d e ’ s t i m , e t h e s u c c e s s f u l w o o l p r o d u c e r w i l l :
» dna t a e m p e e h s , l o o w n e e w t e b d n a , m r a f r i e h t n o s e s i r p r e t n e r e h t o d n a p e e h s n e e w t e b e c n a l a b m u m i t p o e h t e n i m r e t e D
e c r u o s e r , s e i r t s u d n i e v i t c e p s e r e h t f o w e i v m r e t - g n o l e v i t c e j b o d n a d e m r o f n i - l l e w d e r e d i s n o c a n o d e s a b , g n i d a r t k c o t s e v i l
s e c n e r e f e r p l a n o s r e p d n a y t i l i b a p a c
» Und e r s t a n d t h e e t g t a p r r o d u c t s e g m e n t f o r t h e i r a n n u a l w o o l p r o d u c t i o n , s u c h a s t h e a c t i v e l e i s u r e w e a r k n i t w e a r , s e c t o r
a n d s t r u c u t r e t h e i r w o o l p r o d u c t i o n a n d h u s b a n d r y p a r c t i c e s t o p r o d u c e t h e w o o l w i t h t h e s p e c i � c t a i o n s r e q u i r e d b y
t h t a m a i n p r o d u c t s e g m e n t
» Con d u c t a n n u a l p r o d u c t i o n a n d � n a n c i a l a n a l y s e s t o m o n i t o r p r o g r e s s a g a i n s t b u s i n e s s p l a n s , a d j u s t i n g a s n e e d e d
» ‘Kno tw tw y h ea n e e d o t k n o w ’ o t s u c c e s s f u l l y r u n t h e i r b u s i n e s s – a n d s o c u e r t h e s e s k i l l s e i t h e r b y t h e i r f o e w s n s io p o r n a l
e l v od pe m e n t , o r b y e t r a i n xi pn eg r e t a d v i s e r s w h e e r n e e d e d
» e ina v mep nl oea epetc tmie iec mono a aigtvi H rosr msa k eph etdre th e etp sr epeg gfrn m it egts nhe te ( m sbi )ux s io n e s s a n d t a r
» Ado p t a c o n t i n u o u s i m p r o v e m e n t m i n d s e t w h e r e p r o d u c t i v i t y i m p r o v e m e n t s a r e v i o g r o u s l y a n d r e l e n t l e s s l y p u r s u e d
» Par ti c i p t e a i n , a n d m e e t t h e s , t a a n n d a A r d u s s t f a o r l i a n w o o l i n d u s t r y p r o v e n a n c e / s u s t a i n a b i l i t y s c h e m e w h i c h h a s
c r e d i b i l i t y i n t h e e y e s f o c u s t o m e r s i n t h e i r e t g t a m r a r k e t f o r w o o l
» Actie v l y em a pn o ra d g u c t i o n a n d p r i c e r i s k t h o r u g h � o k c s , t r fsu eoeu k etr c i e t n d a g c r o n s e r t i v o a n / f o d d e r p h u c a r s e s a n d
u s f e p o r i c e r i s k em ma en na tg o t o l s
» evH a s o u cr e d a n d s t r u uc ert d t h e � n a n c i a l c a p a c i t y er q u i er d ot p u t t h e i r p l a n s i n ot ap cr t i c e
» el v od pe e H d a a l e c a r s u c c e s s i o n p l a n i n c o n j u n c t i o n w i t h t h e i r f a m i l y a n d / o r b u s i n e s s p a r t n e r s
A REPORT TO THE NSW DEPARTMENT OF PRIM ARY INDUSTRIES 9
F ROM MI R A C L E DO,G POIM ENA ANYAL SIS, SCOT T WI L LI A MS CONSTUIL NG AND D A F W A
FINDINGS
The following key fndings were drawn from the situation analysis and industry consultations.
i. The NSW wool industry is, and should consider itself to be, a component of the NSW sheep
industry. The sheep industry comprises lamb, wool and mutton production.
ii. There is a lack of a clear and shared vision / direction for the NSW wool / sheep industry. This is
likely to inhibit confdence and investment.
iii. The wool industry is perceived by many to be ‘unattractive’ (old-fashioned, low tech, hard work,
non-dynamic), discouraging people from investing or working in it.
iv. There is a need to make the industry more satisfying and proftable, especially for young people.
The average age of Australian farmers, including wool producers, is increasing so the industry
would beneft from the adoption of good succession planning practices, both for individual
FIGURE 3
Productivity growth – Sheep enterprises
12%
KEY
10%
Productivity growth
8% Output growth
Input growth
6% ABARES 2013
4%
2%
Average annual sheep
input, output and
productivity growth 0
by period (%)
-2%
-4%
-6%
-8%
-10%
-12% 1977-78 1988-89 1999-2000
to 1987-88 to 1998-99 to 2010-11
10