Wool/Textile News

Tariff Reduction on Woolpacks

Legislation (HR 1851) was introduced in the U.S. House of Representatives in late April by Rep. Devin Nunes (R-Calif.) to temporarily suspend the duty on nylon woolpacks.

At the American Sheep Industry Association?s (ASI) Board of Directors meeting in January, the industry approved a policy to seek elimination of the duty on imported nylon, woolpacks which are used to ship wool from the farm and ranch to the buyers. 

Nylon woolpacks, which are not produced in the United States, are currently subject to a 7-percent ad valorem duty rate. Additionally, the cost of these woolpacks has increased each of the past three years. Over 50,000 packs are used annually. 

With no U.S. production, this tariff does not provide a benefit to U.S. manufacturers and, in fact, is a detriment to business by increasing costs to companies and to the American wool growers.

The industry is asking for legislative support by including nylon woolpacks in the Miscellaneous Trade Bill that is completed during each Congressional session.

?ASI greatly appreciates the support of Rep. Nunes by introducing this legislation and we will be requesting other members of the U.S. House of Representatives to join as co-sponsors to the legislation,? comments ASI President Paul Frischknecht.

Timothy Koock of Woolsacks Co. has also been an invaluable partner in assisting with the technical points of this issue.

U.S. Launches New Safeguard Investigations over China Imports

The Committee for Implementation of Textile Agreements (CITA) launched new safeguard investigations in 14 categories of imports from China on April 28, 2005. According to Emerging Textiles, investigations could lead to re-imposing quotas effective from July or August.

Included in the safeguard are: men?s and boys? cotton and man-made fiber (MMF) woven shirts, cotton and MMF sweaters, cotton and MMF brassieres, cotton and MMF dressing gowns, synthetic filament fabrics, MMF knit shirts and blouses and MMF trousers and shorts.

Other categories may also be covered after the U.S. Court of Appeals for the Federal Circuit allows CITA to continue investigations that were launched by the end of last year.

This ruling will allow the Committee for Implementation of Textile Agreements to pursue investigations and, in theory, allow them to resume investigations over imports of knit fabrics, other synthetic filament fabrics, combed-cotton yarns and wool trousers. However, it is not yet clear if these investigations will be completed or not, following this decision.

U.S. Company Requires Seven-Year Contract

Outdoor sock and clothing maker, SmartWool Corp., based in Steamboat Springs, Colo., has signed a seven-year $NZ40 million deal (nearly $US30 million) to buy about 400-metric tons of wool annually from New Zealand (NZ) Merino Co.

According to NZ Merino?s chief executive, John Brakenridge, this is the company?s largest contract in both volume and length of time. About 80 New Zealand farmers will supply the contract, which will take-up approximately half of the country?s output of 23-micron merino wool.

Australian Wool Innovation (AWI) has contracted with NZ Merino Co. to obtain advice on how to better sell that country?s merino wool. The contract specifies that New Zealand conduct a survey of Australian wool growers, as well as identify how a direct-marketing arrangement could be introduced in Australia. AWI is hopeful that this $AU300,000 contract will enable them to utilize direct marketing in a way similar to what New Zealand has done with SmartWool.

According to Rita Kourlis Samuelson, wool marketing director for the American Sheep Industry Association (ASI), ?In our domestic market, the U.S. military is similar to the SmartWool/New Zealand wool program in that it utilizes certain types of wool, for specific products, over-and-over again. The difference is that the military does not require the producer to sign a long-term contract. While the military utilizes approximately 20 percent to 30 percent of the domestic wool clip, ASI is continuing to look at innovative ways to market the balance of the U.S. wool.?