The Southland Times
He had a textile background and got burned in the global financial crisis. He was a farmer fighting at least
20 years of pitiful crossbred wool prices.
The situation was dire and the New Zealand wool manufacturing and growing sectors were in bad shape.
Together, Ken Algie, of Dunedin, and Rick Cameron, of Lovells Flat, near Balclutha, founded a company, Agwool New Zealand (Agwoolnz), that has been turning out quality woollen jerseys and other wool products in a trial project, for the past two years.
Spun in New Zealand, made in China, the 1700 jerseys sold for $184 each on Agmatch, a farmers’ online trading site the pair started about 10 years ago. The site is owned by about 650 farmers, who pay a $500 yearly membership, and is supported by about 2500 farmers and rural suppliers throughout the country.
About eight South Island farmers committed 2800 kilograms of 31-32-micron wool to fund the initial Agwoolnz pilot.
‘‘Farmers who committed lamb and hogget wool into the jersey programme have seen their returns climb to between $20 and $40 per kilogram, compared with the current gross commodity price of about $4.50 per kilo for similar quality lamb wool,’’ Cameron said.
It had lifted the value of an 180kg bale of greasy wool from $650 to more than $7000.
Building on the Agmatch/Agwoolnz success, a second run of jerseys will soon be released, with the yarn spun in New Zealand as before but this time manufactured in Auckland and Hawke’s Bay.
Alongside the project, Algie and Cameron are in the process of testing a range of samples with the aim of producing a wool carpet from the backs of crossbred sheep, whose fleece makes up the bulk of New Zealand’s wool production.
Final samples of the carpet, to be made in Melbourne, were to be available at the Agmatch McKeown stand at the Southern Field Days, at Waimumu, this month.
The 33-40-micron carpet will have an initial run of about 150 linear metres – enough to do about eight average-sized homes.
It is expected to have a return of between $250 and $300 a metre (about $13 per kilogram greasy for 34-39-micron main shear wool).
This is a favourable comparison to the average auction price for full fleece wool of $2.65 per kilogram.
Subtracting 20 cents for brokerage, $1.24 per kilogram for shearing, and adding on the cost of wool packs, transport and electricity, the farmer got next to nothing, Cameron said.
‘‘You could say $1 per sheep net – unsustainable – and sheep are being considered by some for meat only; very sad for the people involved and why we all need help regarding this carpet model, to get the returns when they are needed, to pay the shearers and wool handlers,’’ Cameron said.
The self-funding jersey and carpet projects gave farmers an opportunity to be more in control of their own destinies, and less at the mercy of ‘‘wool politics’’, he said.
Crossbred wool in dire straits
In recent times, the South Otago farmer had seen a decrease from 72 per cent of farm income derived from wool, to 12 per cent, and this year negative
10 per cent, where it was almost better to leave the wool on the sheep than to shear it.
‘‘If it was not for meat, we would be down the road.’’
In 1973, Cameron came off a Waitaki merino station to farm crossbreds on the rolling South Otago hills around Balclutha, with his brother Peter.
In the 1980s, New Zealand had 70 million sheep. It now has 27.6 million sheep, of which 3.3 per cent are merino, which produce 12 per cent of the nation’s wool. Of the country’s 16,000 farmers, 700 (4 per cent) are merino farmers.
‘‘Crossbred wool is not sexy like merino. We only produce 12 per cent merino but it gets the most noise.’’
Dealing with the wool board
In the 1990s, Cameron and many others began asking serious questions of the New Zealand Wool Board, about the way wool was marketed and the value it added to wool.
Set up in 1944, the board was funded by a levy on the proceeds of growers’ wool sales: ‘‘A tax before you made a profit,’’ Cameron said.
In 1978, the government introduced supplementary minimum prices (SMPs) that guaranteed farmers price stability for their products, despite declining international prices.
At the time, farm produce was 70 per cent of exports.
‘‘In 1981-1982, the wool board began purchasing at a level beyond the market that effectively held our manufacturing customers to ransom. It turned these customers away from wool to synthetic options and effectively told farmers to get lost.’’
Producers were held in contempt and were powerless to stop the wool board’s ‘‘confiscation of funds’’, to the tune of $90 million a year – $240m today, that went into the so-called promotion and sale of wool, he said.
In his disillusionment, Cameron has spent much of the past 30 years pulling the wool away from people’s eyes about the industry. ‘‘The wool industry has drowned in a sea of words and broken ideals,’’ Cameron said.