Domestic Wool Feasibility Studies Begin

Article by: Hari Yellina

Deloitte Access Economics has been tasked with conducting a feasibility assessment on the possibilities for domestic wool production plants and expansion opportunities for the wool sector. A steering committee composed of representatives from Australian Wool Innovation, National Council of Wool Selling Brokers of Australia, Australian Council of Wool Exporters & Processors Inc, Australian Wool Testing Authority, Australian Wool Exchange, and Austrade will oversee the WoolProducers Australia project, which received $662,000 in federal funding in November. Opportunities, changing trade patterns, the danger of emergency animal diseases, Australia’s aim to enhance local manufacturing capacity, and supply chain expectations on sustainability and transparency, according to WoolProducers CEO Jo Hall, will all be considered in the study.

“We are thrilled to hire Deloitte to undertake this work to steer the future of our business and bring significant benefits to the greater Australian economy after a very competitive tender process,” she said. The steering committee, with its broad membership, is a key component of the project, offering direct industry connections and knowledge to the Deloitte team, as well as ensuring that the final report is useful to the entire sector. Over the duration of the project, industry consultations will take place, with a final report expected to the Department of Agriculture, Water and the Environment in September.

Australian Wool: Overview

In 2021–22, Australia’s cotton planted area is predicted to grow by 121 percent to 657,000 hectares. Following a significantly higher than projected dryland planting, the predicted planted area has increased by 20% since the December 2021 Agricultural Commodities Report. Favorable cotton prices and weather conditions have encouraged the big planted area. The La Nina event of 2020–21, which was followed by a negative Indian Ocean Dipole in winter 2021, brought significant rainfall to eastern Australia’s cropping regions, recharging on- and off-farm storages and improving water availability for irrigated cotton. In 2021–22, another La Nina event will bring heavy in-season rainfall, prompting growers to build a big dryland cotton region. Above-average yields can be projected if the favourable conditions hold through the rest of the growing season, along with a somewhat dry conclusion. Cotton production in Australia is anticipated to expand by 91% to 1,158,000 tonnes in 2021–22.