Changes in wool selling?

Press, 24 July 1987, Page 10

Changes in wool selling?

Major changes in the international wool marketing system have been predicted by a co-founder of the Massey Wool Association, Mr Rex Weber, of Palmerston North.

He foresees wool being sold against full certification, and a level of values which will be known and well-publicised every hour, akin to the currency market and the wool futures market.

The grower will become less of a price-taker and more of a pricemaker, he believes, and manufacturers will get more reliable deliveries, which will make them more profitable and better able to compete with synthetics. Mr Weber, a member of the wool industry since 1936, painted this scenario to the Massey Wool Association conference. But he saw dilemmas in reaching this point, such

as should the auction system be replaced, and how a benchmark price could be achieved. Mr Weber said the auction system was now at risk, with exporters complaining about their lack of profitability and private sales increasing. The Wool Board was trying to combine a regulatory and promotion function with a buying and selling operation, and this raised the question of whether it was advantageous to sell measured and certified wool by auction.

Private selling was not the answer, although private sales provided a most vital and competitive edge. “Sadly, if private sales enlarge their grip on the market this points to the inadequacy of present auction selling. When wool brokers move into the field it seems to be an admission of defeat; they

should be putting their own house in order.” Mr Weber said that although lessons had been learned from the past, some had not been given sufficient priority. The grower and the manufacturer were the only two sides to the wool industry equation, and whilst others in the trade were relevant, they had no divine right to dictate the course of events or even to be considered if growers and manufacturers were not well served.

Mr Weber questioned whether enough thought was given to how well a batch of wool would process, or whether producers were rewarded for well-bred, well-harvested wool.

Manufacturing quality was critical to wool’s future as a premium fibre but little was done to encourage quality wool production.