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Wool Stocktake : AWI Annual Report 2015-16
CEO’S REPORT The 2015/16 year was the last year covered by the three-year 2013/16 AWI Strategic Plan, and I am pleased to report to woolgrowers that the company attained or exceeded three quarters of the targets in the Plan, with significant progress achieved in most of the remaining targets. This is a great result for an R&D and industry marketing organisation, especially one working in such uncertain economic times as we have experienced during the past few years across our key markets. I said in my report last year that, having achieved a sustained four-digit Eastern Market Indicator (EMI) in recent years, our new aim was a 1200-cent indicator. Due to improved demand along with supply factors, the average monthly EMI increased to more than 1200 cents for the entire 2015/16 year. This increase has been very rewarding to watch and, more importantly, rewarding financially for many woolgrowers. My aim going forward is to ensure this indicator level is sustained in the short term and increases even further in the future. I anticipate that AWI’s new three-year Strategic Plan, which began on 1 July 2016, will help us achieve this goal. The Plan reflects not only the aims and goals of the company in this next strategic period, but also demonstrates our emphasis on transforming AWI into a digital and service orientated company. We are determined to ensure that all parts of the wool supply chain are innovation rich and that Australian woolgrowers are the significant beneficiary. All AWI staff are very aware that they are accountable to Australian woolgrowers. I ensure they are regularly reminded of the ‘woolgrower test’, which underpins the day-to-day operations of all AWI staff across the globe: “would this action be acceptable to woolgrowers?”. Marketing During 2015/16, our Marketing portfolio has invested in targeted programs to help create demand for Australian wool amongst consumers in key markets across the world, and thereby increase returns to woolgrowers. Our Fibre Marketing strategy continued to have great success. The interest in the International Woolmark Prize from the fashion communities and media globally continues to be phenomenal – it is helping put wool back on the agendas of fashion designers across the world, and consequently into retail stores for consumers to purchase. 2015 also saw the completion of the Campaign for Wool’s sixth year, as the global initiative continues to educate consumers about the fibre’s environmental benefits, with great support from His Royal Highness The Prince of Wales. Out Trade Education program has been particularly busy this year, for example exhibiting at 16 international trade shows, opening the Wool Resource Centre in Hong Kong, educating a broad range of fashion and textile students across the world, creating trade education marketing collateral that brands and retailers can utilise, and showcasing AWI’s seasonal guide to the best wool fabrics and yarns in the world, The Wool Lab. Our Product Promotion strategy also continued to create new demand for wool through a comprehensive range of global and local collaborative promotions with designers, brands, retailers and media that targeted high income consumers of luxury goods and premium apparel. We moved away from asset specific programs (Sports & Outdoor, Nurture by Nature, Urban, No Finer Feeling, Woolmark Gold and Cool Wool) to investments driven more by the demand of AWI’s individual marketing partners. The aim of these collaborations between AWI and its individual marketing partners is always to increase the demand for Australian wool. Research and Development Investment by AWI’s On-farm R&D and Off-farm R&D portfolios both increased in dollar terms in 2015/16 from the previous year. The Off-farm R&D portfolio this year facilitated the creation of business opportunities through the transfer of new technologies to, and diversifying the location of, the global manufacturing supply chain; fibre advocacy initiatives such as funding trials that show suitably selected fine Merino products are healthy for the skin; and R&D initiatives to establish and communicate the eco-credentials of wool. The On-farm R&D portfolio this year delivered a range of targeted tools, skills and knowledge to help woolgrowers improve their on-farm productivity and profitability. Lifetime Ewe Management training continues to be extensively funded by AWI to help woolgrowers develop the practical skills to improve animal nutrition, lambing percentages and weaning rates. To reduce wild dog predation across Australia, 28 new community wild dog control groups were established this year, with 43 currently active groups at 30 June. The amount of shearer and wool handler training this year increased from last year, due to cost savings. Protecting the national flock from flystrike remains a top research priority at AWI. To help with extension, our seven state- based extension networks have seen another successful year, with increases in participation and the reported benefit by woolgrowers. I am very proud of the progress that the company has made – for the benefit of woolgrowers across the country, who we serve – and I am confident that the company’s new three-year Strategic Plan will continue to benefit woolgrowers into the future. Stuart McCullough CEO, Australian Wool Innovation 19 August 2016 UP FRONT 9
AWI Annual Report 2014-15
AWI Annual Report 2016-17