Things have been moving at a fast pace since our last newsletter in early December. A lot has happened, yet, in many ways, we find ourselves facing the same persistent challenges.
The WoolPoll result, a 1.5% levy, stands as a testament to the democratic process. While some may dissect the "what ifs," the reality is that the status quo prevails. Regardless, with the current price of wool and production volumes as they are, a marginal levy increase wouldn't have made much difference to AWI's financial position.
Looking ahead to this year’s AWI director elections to be held in November, I believe the industry needs a strategic shift in board composition. At this critical juncture, I question the value of wool growers or stud breeders running for the board, while production knowledge is so important to the AWI board, there are currently many directors with production experience. What we desperately need are marketers and researchers – individuals with the expertise to navigate the complex market dynamics and drive innovation, which the industry so desperately needs.
We are currently facing a perfect storm. Dry conditions in the southeast, the devastating live export situation in Western Australia, and the resulting cost of production and confidence issues have created a challenging environment. Yet, I firmly believe profitability is still within reach, so it is important for producers to first understand their cost of production before diversifying into other ventures.
The elephant in the room remains the wool price. Despite historically low production, prices haven't responded as expected. Our global market share in the overall textile sector is precarious. To address this, we need to explore new avenues, particularly in low-end products like jocks and socks, to move our wool through the pipeline effectively.
I commend the WPA Board for commissioning the report Factors influencing the Australian Wool Price (FIAWP) report, conducted by Episode 3. While this report was commissioned in the second half of last year, we strategically withheld its release during WoolPoll to allow AWI and industry to conduct the poll unimpeded and without influence. Subsequently, I extended an offer to the AWI Chairman to discuss the report early this year, an offer which was unfortunately rejected. Instead, we were directed by the AWI Chairman to release the report to WICP and WCG and our members. This marked the second time WoolProducers had extended an offer to meet with the Chairman, only to be met with a closed door.
It's clear that the majority of representatives within AWI’s Wool Consultation Group and Wool Industry Consultative Panel remain invested in AWI's current trajectory, believing the industry will ultimately recover. There was an opportunity to discuss the valid points in the FIAWP report at these meetings, which should have been a great platform to have strategic conversations, however this opportunity was missed.
The industry has fundamentally changed, and we are at a crossroad in the industry. It is time for industry to come together and stop focussing on petty personal agendas and start acting in the interests of industry – we cannot afford to be distracted by egos, as people are leaving the industry as we speak. As an industry we must consider any and all opportunities to streamline operations and save wool growers money. The current path is unsustainable.
The challenges are significant, but so is our potential. By embracing strategic change, fostering collaboration, and prioritising tangible solutions, we can navigate these turbulent times and build a stronger, more resilient wool industry.
Steve Harrison
President
WoolProducers Australia