Between the lines: Another jolt for country's growers

By PHILIPPA STEVENSON

Wool has become a costly, unwanted byproduct of meat production on a lot of New Zealand farms.

Inevitably, farmers have to deal with the wool on their animals, including the expensive business of shearing it up to twice a year.

But many of them would rather not think about it much at all.

It has been suggested that this lack of interest and focus on wool is one of the reasons the industry has failed to implement at least 20 weighty reports on how to arrest a decades-long decline that has taken wool from the country's economic mainstay to something of a liability.

It is thought simply that too few people cared enough or had sufficient energy to get behind the latest silver bullet.

A more unkind suggestion was that conservative sheepfarmers were just too unwilling to change.

Either way, the McKinsey report that woolgrowers will get in the mail today faces a tough test.

Will it be successful where all those other reports have failed?

It talks tough. For example: "Those growers who are currently struggling as owners/managers of sheep farms, and who do not wish to make the changes necessary for large improvements in productivity, should consider other options."

But there is nothing new in tough talk.

In 1971, a similar type of report slated wool for not responding to marketplace threats "and the current marketing system is mainly responsible for this lack of response."

Again, in 1992, another report said "the industry in the past has allowed the chance to make improvements to slip by.

"If it does so again, [it] will continue its longterm decline."

The latest report is billed as do-or-die for the industry.

"Taken together, the recommendations should pave the way for growers to improve profitability.

"If any part of them is excluded, the whole proposed structure might have to be re-evaluated."

But just two years ago, then Wool Board chief executive Jeff Jackson warned that "we must change or die" - before offering a scheme to integrate the fragmented wool-selling process which barely survived the light of day.

More likely, a radical turnaround in wool industry fortunes will depend on how desperate some farmers are, and how successful others are.

There is a great divide in fortunes. The leading 30 per cent of farmers are more than twice as profitable as the average, while the bottom 30 per cent operate at a loss.

For the industry to have the critical mass to remain a force, the harshest survival scenario would require most farmers to gain the top rung, and the non-salvageable loss-makers to depart altogether.

The alternative may be just a few farmers supplying a rare fibre to customers who can afford the high price for uniqueness - a veritable cottage industry.