Frequently Asked Questions

No, the Wool Alliance is not a new organisation and it is the name for the collective work of the four organisations involved.

The Wool Alliance has established a steering group with an independent chair to help guide this work and is drawing on the resources and structures of the member organisations.

Ultimately, a new organisation will be established for the model being collectively developed but this will see a net reduction in the number of wool sector organisations currently operating.

We have around 20 years of underinvestment in wool that has contributed to declining prices.

The fundamental value drivers for wool are strong but we haven’t adapted to evolving consumers and markets and we haven’t made it easy for people to innovate, specify, promote and sell wool products.

We know that our wool is worth a lot more and that higher prices can be paid now, but it requires work to be done to realise that value.

Growers

There is the opportunity to improve the profitability of wool and sheep farming, but it requires work and investment.

Not doing this means we are missing out on hundreds of millions of dollars of revenue each year for sheep farmers.

Industry

The profitability of producing wool needs to be improved in order for it to continue to be produced.

Growers and industry have a shared interest in seeing greater value for wool generated to ensure that it continues to be produced.

One of the four pillars of the model is that it needs to be lean and transparent - no bigger than it needs to be.

An indicative budget of around $5 million has been developed with a view to having multiple sources of funding for this – growers, industry, government and other co-funding.

For growers, this would mean a contribution of about 2 cents per kg greasy. For a farm producing 10 tonnes of greasy wool that would mean $200 per year – this investment relative to the potential return is small.

We’ll be seeking a similar amount from industry in a way that recovers that cost from the market and represents between 0.10% and 0.40% of the current export prices for the different wool types.

We know that we won’t get grower support if growers are the sole funders of this model.

The industry contribution must be through a mechanism that means this cost is paid for by the wool buyer.

The work that this funding supports aims to enable value growth for wool that far exceeds the amount collected.  

Yes, the products that our wool goes into can and have supported much higher prices.

We are seeing that happen now as a result of reduced supply and increased demand.

We need to keep building demand to maintain and grow the current upward trend in price.

There is no fixed number that we are targeting and this is about enabling sustained increases in the price of wool.

We know that current prices still aren’t enough and that higher prices are needed for wool to deliver meaningful revenue and profit for production to be maintained.

The model is a balance of what is needed to deliver better commercial outcomes for wool with what can realistically and practically be put in place.

The current view is that this model and the central wool organisation need to be an enabler for commercial outcomes and entities, not competitive.

There is a range of non-commercial and pre-competitive work that needs to be done in support of existing commercial initiatives and commercial outcomes.

There are also existing commercial initiatives that are underway and can be supported now by growers.

Strong wool is over 75% of what is produced in New Zealand and where there is the greatest need – this is reflected in the model and where we are focused.

There is still activity that can be done at a sector level (e.g. education and training) that will benefit fine and mid-micron wool.

We are engaging with those currently working on fine and mid-micron wool to explore whether the model should include these wool types.

It is on us to provide confidence that the model can deliver the outcomes needed.

There is work happening now across the different Wool Alliance organisations that will provide clear proof points for the model.

The intention is to establish a minimum viable version of the proposed model before seeking funding support for it so that it is real.

This model is based on current and previous work to understand and respond to the needs of those who influence demand and value for our wool.

We have been engaging with companies across our wool supply and value chains and outside of the wool sector to inform what work is needed.

Prices are lifting at a time of reduced supply and increasing demand driven by activity to support this demand.

Work is already happening and we need to continue and amplify our current work to sustain these price increases, otherwise these gains could be easily lost.

There is work happening now across the Wool Alliance organisations (and through others) while we develop and seek support for this model.

The 2027 timeline is to allow a thorough process to develop the model while our current work continues in support of increasing demand and value and providing the proof points for the model.