Make wool cool, industry expert urges

Wool industry experts from around the globe have listed education, innovation and image as priorities in building demand for the future.

At the International World Textile Organisation Congress held last week in Biella, Italy, delegates, particularly concerned with parlous superfine wool prices, expressed it was critical that wool reach a high standing among consumers.

Speaking from the Italian wool industry's perspective, Schneider Group chief executive Claudio Lacchio rejected any intentions of the processing and manufacturing sectors being moved to lower labour-cost countries.

"Chasing a few extra cents of savings this way is not the approach to take," Mr Lacchio said.

"Instead, the industry should be looking to build demand through product innovation and building the image of wool products."

He also argued that cotton and synthetic fibres were not wool's competitors.

"We cannot hope to compete with those fibres by volume," Mr Lacchio said

"Instead, we should be aiming to be like cashmere and silk, which have a very high standing among consumers, which generates high prices and higher production."

National Council of Wool Selling Brokers of Australia executive director Chris Wilcox said Australia was on track to exceed its greatest volume of superfine wool production.

"Volume of wool of 18.5 microns and finer tested in Australia this season to the end of May was up by 19 per cent," he said.

"This is a major (but not the only) cause for lower wool prices."

In Mr Wilcox's short-term outlook for wool presentation, he said global wool production increased by 2 per cent in 2012-13, but would be reversed in 2013-14.

"On the demand side, economic growth was weaker than expected in 2012 in all the major wool consuming countries and, as a result, growth in retail sales of clothing, including woollen garments, in 2012 was lower than in the previous two years," he said.

"Prospects are for a slow improvement in economic conditions by the end of 2013, which expectations of a moderate improvement in wool textile conditions and raw wool demand by the year's end and first half of 2014."

Australian Wool Innovation group manager Paul Swan told congress delegates that the longer-term trends and strategic issues for the global wool industry would come from income and demographic changes.

Mr Swan identified the major growth opportunities for wool at retail, both by country and product sector.

In the session's discussion and debate, congress participants Francesco Botto, of Reda (Italian superfine fabric company) and Tian Ye, of Esquel Group, China, agreed that education and innovation were critical, particularly in regard to the parlous state of superfine wool prices, and there were few answers.

"We need to make wool cool," Mr Botto said.

The Market Intelligence Forum also had Food and Agricultural Organisation of the United Nations representative Daniela Battaglia give an outlook and issues presentation for global agriculture.

On the topic of land competition designated for food production, Ms Battaglia said growing demand over the next 30 to 40 years from merging and developing countries, as incomes rose, would be concentrated on animal protein (meat, dairy and eggs).

"This will mean increased demand for cereal grains for animal feed," she said.

"As well, the FAO predicts that there will be increased production and use of plants (corn and sugarcane) for use in biofuels."

"This combination will bring increasing competition for arable land to sheep grazing and the growing of cotton.

"It will also bring higher prices for grain cereals, beef, pork, poultry, eggs and sheepmeat."