Textile body slams wool industry rescue report

By PHILIPPA STEVENSON agricultural editor

An international wool organisation has joined the chorus of criticism of the McKinsey wool industry rescue report.

The International Wool Textile Organisation (IWTO) said submissions by its members did not figure in the report, raising the "strange" possibility that the consultants had ignored the views of almost two-thirds of New Zealand's customers.

IWTO president Dieter Vollstedt said to ignore the submissions by members of the organisation's crossbred users committee "would appear" to misinform farmers. Members unanimously submitted that a cut in promotional funding would have a long-term adverse effect on the wool trade.

"They felt that recent price rises were due to recent good promotion and that previous low prices would have been worse without the good promotion of the Fernmark [brand]," Mr Vollstedt said.

The McKinsey report, which began being debated formally by farmers in Whangarei yesterday at the first of 34 nationwide meetings, recommended that farmer-levied promotion of wool cease.

But the IWTO's members were so concerned about the prospect of promotional cuts, a move already begun by Australian farmers, that they had recommended raising an additional levy to supplement Fernmark funds among their members, Mr Vollstedt said.

"One condition set by the Crossbred Users Committee was that farmers should continue contributing to the present Fernmark promotional team."

The committee chairman, John Ward, one of the first licensed Fernmark woolspinners, said his members were concerned that farmers were being grossly misled and would suffer accordingly.

The 23-member IWTO, which had its annual conference in Christchurch in May, represents the interests of the world's wool- textile trade and industry. Wool promotion was the major concern to emerge at the conference.

New Zealand's Wool Exporters Council also criticised the recommended cuts to farmer-funded promotion.