The Wool Levy Group pitches its reasons why farmers should vote 'yes' in the upcoming producers referendum

Content supplied by the Wool Levy Group

“Sheep farmers  can help shape the direction of the wool industry by voting ‘yes’ in a referendum to re-introduce a wool levy to fund industry good activities of benefit to farmers and the wider wool industry,” Sandra Faulkner, Chairman of the Wool Levy Group announced today.

“The new industry good body will represent all NZ wool producers and provide a much needed voice for the wool sector.

“We have a great opportunity to create momentum off the back of improving prices for wool. We want to inspire and invigorate the new generations of wool growers who are not currently engaging with or influencing the direction of the wool industry.

“Currently growers are represented beyond the farm gate by Merino NZ, Primary Wool Co-op and Wools of New Zealand - these companies do a great job on behalf of their shareholders but there are around fifty percent of wool growers who don't belong to these companies.

“A farmer levy means that an industry good body will be consistently funded and work in the best interests of all New Zealand’s wool producers.

“Through this referendum process we encourage farmers to talk to us – to let us know what they think.

“This is their industry and their money so farmers will expect this industry good organisation to deliver worthwhile results. We understand this – we are wool growers ourselves.”

The Wool Producers Referendum is set to take place on 10 October 2014 and will ask sheep farmers to fund a new industry body by approving a levy  of between 2 and 5 cents for each kilogram of greasy or slipe wool at the first point of sale.

This equates to $4.6 million based on 3 cents per kilogram for the 154,000 tonne of wool produced in New Zealand each year. Around 17,000 sheep farmers will be eligible to vote.

A positive grower vote, both by number and weighted sheep numbers, is required for the Wool Levy Referendum to be presented to the Ministry for Primary Industries before the Minister can enact the necessary regulations under the Commodities Levies Act 1990. 

“The average value of raw wool exports increased by 38% between 2010 and 2014 and our industry is now worth $700m,” said Faulkner.

“New Zealand is the world’s third largest wool exporter supplying 45% of the world’s carpet wool. There are 30 industry good bodies in New Zealand, yet wool is the only primary sector which is not represented.

“We can make a difference if we maximise our opportunities to shape a great future for our industry but we need a vehicle to do this.”

Mrs Faulkner said the referendum followed extensive work by the Wool Levy Review Group, a pan sector group established in 2012 to investigate collective grower investment.

The research found there was a case to establish a respected industry good organisation to:

• Provide a shared vision for the sector
• Act as a point of initial contact for pan-industry information
• Provide a sounding board for government bodies e.g. Ministry for Primary Industries and the Ministry of Business, Innovation and Employment.
• Assist with trade policy and negotiation to gain market access and reduce barriers to entry
• Provide an overview of and investment in, industry good research and development. Leverage government and industry funding.
• Provide funding for initiatives promoting the awareness of wool.

“In December 2013 The Wool Levy Review Group agreed a business case for forming a smart and efficient industry good organisation. This is needed to inspire and reinvigorate the industry - to help restore a focus on wool production and profitability.

“Farmers at the Beef & Lamb AGM in March this year voted in favour of the proposal and the Wool Levy Group has now been established to run the Wool Levy Referendum.”

Areas of focus for the industry body currently proposed by the Wool Levy Group are:

• Raising profile, demand:
  • understanding the market and getting information to famers
  • ensuring that consumers and those that influence buying decisions have an understanding of wool and an incentive to use it
  • provide funding for promoting awareness of wool to the right decision makers in the supply chain
  • Provide funding for education and promotion of the unique qualities of wool as a fibre
• Information, policy and advocacy:
• represent a currently under-represented wool industry and ensure better access to information which impacts the industry
• engage with MFAT to ensure trade policy adequately reflects the farmers’ position
• ensure productivity improvements (processes, animal welfare, nutrition, quality) and cost benefits e.g.:
  • Encouraging greater adoption of improved genetics such as those which will breed sheep with less wool around the tail and thus less dags.
  • Identifying systems and processes to reduce costs on farm or post -harvest.
• Encourage the creation of new spaces for wool such as wool underlays and bedding in retirement homes.
• Research &Development and extension:
• Influence new product development and define new markets

Governance and Administration

The pan sector Wool Levy Group comprises:

· Sandra Faulkner – Chairperson

· Derrick Millton – Chairman, WRONZ

· Bruce Wills – President Federated Farmers

· Jeanette Maxwell – Chair, Meat and Fibre Section, Federated Farmers

· Hamish de Lautour – Director, Primary Wool Co

· Colin McKenzie – CEO, Cavalier Corporation

· Derek Daniell – Principle, Wairere Rams

“Over the next six months and in the run up to the referendum the Wool Levy Group will be seeking  opportunities to share information on the proposal through a website which is currently under construction; using media channels and at various farmer meetings. We will welcome all feedback from farmers – we want to get this right. ”