May 15, 2004
May 2004 -- How does a customer's use of measurement and pricing affect the price producers receive for their wool? That was just one of many questions asked - and answered -- at a special roundtable meeting held in conjunction with the recent American Sheep Industry Association (ASI) annual convention.
There, a crowd consisting of domestic wool producers, buyers, processors, market reporters and international wool industry specialists discussed a wide range of topics with ramifications for various segments of the wool production and processing chain.
- U.S. Department of Agriculture market reporter Ron Cole spoke about last season's wool prices, and the recent changes the department has made in regards to their reporting. One such change is the listing of wool prices on a "clean wool sales basis" whenever possible. The reasoning? Prices for greasy wool can be misleading due to wool yield. Cole reported that wool 'description' continues to be challenging when it comes to price reporting. However, the ever-increasing use of objective measurement, an unbiased measurement of wool fiber characteristics, and the feedback industry members are receiving from the processors and wool mills are contributing to enhanced price-discovery information for the U.S. wool industry.
- Bob Couchman, managing director of Capronex Services Pty, Ltd. Australia, presented information on "understanding your customers' use of measurement and pricing and how its affects your price for wool." Couchman reported that buyers are increasingly relying on objective measurement information in their purchases as opposed to their former preference for subjective assessment. He also discussed the parameters affecting wool price most significantly, and how growers can utilize objective measurement data to reduce market-price risk.
- Couchman also discussed the 'description' of wool and how the combination of objective measurement and subjective assessment are combined in the Australian Wool Exchange (AWEX) ID system. The AWEX-ID system is different than the old typing systems of the past, noted Couchman, who indicated that U.S. wool is already being compared to the AWEX-ID system by buyers. "It makes sense for U.S. wool growers to look at how they can adopt this universal description," said Couchman. Another added bonus: Transitioning to this system might not be as hard as some members of the U.S. wool industry might think. Almost all wool buyers are familiar with the program because wool is an internationally marketed product -- with Australia marketing the most. AWEX training sessions are slated for April 28-29 in Denver and April 30-May 1 in Roswell, N.M. A follow-up session will be held in July to discuss areas of concern and how the industry can move forward with an AWEX description of wool.
- American Wool Council member and Sheep Shearing Task Force Chair Jim Bristol of Michigan, reported on the task force's first meeting in Denver. The group has several recommendations, such as the need to move forward with a certification program through which sheep shearers would be trained on practices and techniques for improving the quality of the U.S. wool clip. Other highlights included the need to train more shearers, as the average age is increasing and finding shearers is becoming more difficult. The task force also recommended developing a database with contact information for shearing contractors and shearers; and possibly developing a mobile shearing/teaching lab that would be used in the training of shearers nationwide.
- The results of a pilot project on staple length and staple strength were reported by Dr. Chris Lupton of Texas A&M University. The year 2003 marked the first year of wool length and strength testing for U.S. wool producers. The results, reported Lupton, demonstrated the effects of severe drought conditions during the 2002-2003 growing season. However, Lupton noted that the results of the 180 samples tested in the United States last year were comparable in terms of uniformity of staple length and staple strength in comparison to the same tests conducted in Australia. ASI purchased the equipment used to conduct the tests. It is housed at Yocom-McColl Laboratories in Denver.
- The increasing problem of contamination of U.S. wool by polypropylene was addressed by Terry Martin of Anodyne, Inc. Martin reported that more claims are now being filed against U.S. companies that supply poly-contaminated wool than in the past. He added that mills and buyers understand growers' frustration due to low prices for all wool. However, as wool prices have risen, so too have mills' expectations for higher-quality wool. Polypropylene is the No. 1 contaminant in American wool. Poly twine and poly tarps are the major sources.