Farmers grow own carpet company

A group of Northland wool growers have formed their own carpet company in a bid to double returns in the struggling industry.

Murray Lynch is the managing director of wool merchant The Great New Zealand Wool Company and also chief executive of the Northland Carpet Company, which was formed in January last year.

Lynch organised a meeting in 2007 to discuss ideas, including forming a company, and subsequently he and 23 Northland wool growers invested $10,000 each.

The mission was to create a profitable business that doubled returns to wool growers within five years and there was no reason why the company could not grow its sales to between $5 million and $7 million within the first three years, he said.

Sheep numbers were down 11 per cent to 34 million in the year to June 2008, with wool exports down 4.6 per cent to 136,909 tonnes.

Wool is becoming a byproduct for some growers, with shearing an animal health exercise.

But Lynch said he was a strong believer in local business.

"The second thing that came to mind was just the very poor wool returns and absolute frustration that the farming community have had in the last probably 25 years about what's gone on with wool," he said.

"There's just been a huge amount of money wasted as they've gone round and round in circles."

Farmers needed to take control of their own product as far through the chain as possible so they could get the benefit of the margins and retain control, Lynch said.

Northland Carpet Company has so far made 61 rolls of carpet from 100 bales of wool, equivalent to 2250m.

Each carpet will carry a provenance of origin, including the growers that supplied the wool.