China’s ban on imports leaves wool sector hanging

The future of South African wool exports earmarked for China remains uncertain after that country announced a ban on the importing of all products from clovenhoofed animals originating in South Africa.

This came on the back of three new confirmed foot-and-mouth disease (FMD) outbreaks in South Africa that were reported to the World Organisation for Animal Health (OIE).

One such outbreak occurred near Potchefstroom in North West, an area in which FMD was previously thought to be non-endemic.

Cape Wools SA subsequently decided in early April to postpone all wool auctions until more clarity could be obtained from the Chinese authorities on the exact nature and duration of the ban.

“We decided to halt auctions because South Africa exports 80% of [its] wool in raw format to China,” Deon Saayman, general manager of Cape Wools SA, told Farmer’s Weekly.

“Currently, R300 million worth of wool is already in transit to China, but it’s not going to be cleared at customs. Another R700 million had already been sold when the announcement came through, but now it cannot be shipped.”

He said it was uncertain what would happen to this wool. “The only thing we do know is that it’s useless for a wool buyer to buy a product that cannot be sold again.”

According to Cape Wools SA, South Africa’s wool clip generated about R6 billion a year in export revenue. Billy van Zyl, chairperson of the National Wool Growers’ Association of South Africa, said the organisation had been caught unawares by this development.

“The wool industry has jumped through hoops to ensure it remains within all regulations needed to continue exporting to China,” he said.

At the time of going to print, the industry and government were still in discussion on a way forward.

“Although this affects many [industry] role players, in the end it’s the farmers who [suffer] the biggest losses,” Van Zyl said.

Saayman added that when FMD was reported in 2019, the wool industry had been unable to export wool for eight months.

However, according to OIE guidelines, a country was allowed to export wool if it had been stored at a minimum temperature of 18°C for at least 28 days.

According to OIE research data, the FMD virus was inactivated after this length of time, and the wool could then be transported safely without any fear of spreading FMD.

“Every export facility in the country had to install temperature loggers, which were then linked with Cape Wools SA’s central database,” Saayman said.

“Before any container was finally filled, the state veterinarian could use this data to determine whether the wool adhered to OIE standards.”

Saayman added that this practice had been in place since 2019.

“Once an outbreak has taken place, it’s safe to assume that it could happen again. It has therefore become common practice to manage all wool in this manner.” – Susan Marais

‘THIS WILL AFFECT MANY ROLE PLAYERS, BUT FARMERS WILL SUFFER THE MOST’