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Wool Stocktake : AWI Annual Report 2016-17
CHAIRMAN’S REPORT 2016/17 was a very good year for woolgrowers, with the average EMI for the year climbing to more than 1,400c/kg, and in the latter months regularly exceeding more than 1,500c/kg. The finer microns have performed particularly well. These robust prices are fundamentally a result of a strong and consistent demand for our fibre. AWI’s marketing in key northern hemisphere markets has been successfully cementing Australian wool as a premium fibre for which consumers are willing to pay a premium price. The high prices that woolgrowers in Australia have been receiving for their wool contrasts with less favourable prices that wool producers in many other wool-growing countries are receiving. This demonstrates the high- regard that buyers across the world have for Australian wool in particular, which is something that growers of this quality fibre across our nation can be justifiably proud. Merinos have long been the foundation of the national flock, and they are now as important to the sheep industry as ever. Growers who have shown commitment to the breed are now taking advantage of the higher demand-driven wool prices. As confidence continues to return to the industry, it has proven to be very profitable for woolgrowers to retain older Merino ewes and ewe lambs for breeding purposes, to continue to rebuild their flocks, and invest in Merino wool. Producers who run mixed enterprises are also finding that wool fits into their business very well and is an increasingly important and profitable enterprise. Given the high input costs of cropping and variable seasonal conditions, producers in the wheat-sheep zone and low rainfall areas are seeing the financial benefits of having a wool enterprise to manage their risk. Accountability The AWI Board, along with management and our staff across the world, is acutely aware that it manages a significant investment by Australian wool levy payers and the Federal Government. Woolgrowers are central to everything AWI does, be it R&D or marketing. Everything the company undertakes is aimed at increasing the profitability of Australian woolgrowers and enhancing the international competitiveness and sustainability of the Australian wool industry. It is individual growers that vote every three years at WoolPoll to determine the wool levy rate. It is AWI shareholders, rather than political appointments made by government or agri-political groups, that directly elect Directors to the AWI Board. Furthermore, AWI consults year-round with woolgrowers to identify their priorities and guide AWI's activities. Activities are reported to woolgrowers and government on a regular basis through Beyond the Bale, e-newsletters, The Yarn podcast, the Wool.com website and the Annual Report. AWI also attends each year more than 50 sheep and wool industry events across the country that enable woolgrowers to directly consult with and provide feedback to the company. In addition, there is the AWI Woolgrower Industry Consultative Committee (ICC), which is a formal mechanism for AWI to consult with national woolgrower industry organisations; this includes an observer from the Australian Government. AWI also reports to the Government every six months on its compliance with the Statutory Funding Agreement (SFA) to ensure AWI is operating in line with levy payers’ and the Government’s expectations. Delivering results The past year was the first year covered by our new three-year Strategic Plan, for the period to 30 June 2019, and we have delivered positive results for Australian woolgrowers. In the marketing area, we have worked with some of the big global names in fashion and textiles – from Tommy Hilfiger to adidas – to build demand amongst consumers for Australian wool products. Despite ongoing economic uncertainty in several markets around the world, this healthy demand for premium products made from Australian wool is reflected in the prices that Australian woolgrowers are receiving for their wool. In the on-farm R&D area, we continue to address production issues, such as through the Merino Lifetime Productivity project and our funding to combat wild dogs and rabbits. We also continue to encourage grower practice change to improve profitability, through programs such as Lifetime Ewe Management and our state-based grower extension networks. I have always been adamant to provide my commitment to you that this company – your company – will continue to operate for the benefit of woolgrowers. I have dedicated my life to this great industry of ours, and I once again assure you that AWI will continue to be driven by woolgrowers, delivering for woolgrowers. Wal Merriman Chairman, Australian Wool Innovation 1 September 2017 8 UP FRONT
AWI Annual Report 2015-16