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Wool Stocktake : AWI Annual Report 2017-18
CEO’S REPORT 2017/18 was the second year covered by AWI’s current three-year strategic plan. Building on the healthy momentum begun last year, AWI has continued in 2017/18 to make significant progress in achieving the targets set out in the plan. I am confident that AWI will have achieved a large majority of these targets at the end of the three-year period, delivering significant results for Australian woolgrowers who own the company. We will soon embark on developing the next three-year strategic plan, based on the result of WoolPoll 2018 and in consultation with woolgrowers and other stakeholders to ensure AWI continues to meet the needs of industry. I am delighted that in 2017/18 we achieved an increase in the average EMI of 23% from the previous year, which has benefited all woolgrowers. I am even more delighted that these increases are being sustained, with the EMI recently surpassing the $20 mark for the first time, rewarding the hard work and loyalty that woolgrowers have demonstrated to the fibre. In export terms, the value of Australian wool has lifted to $4.3 billion in 2017/18, up from $2.3 billion in 2009/10 when I was appointed as AWI CEO. Our industry is in a strong position. With supply having increased during the past couple of seasons, I consider these robust prices as fundamentally a result of a strong and consistent demand for our fibre. Australian wool of all microns have performed well this year, while other competitive fibre prices remain relatively flat. Marketing Our Marketing portfolio this year has continued to partner with premium brands and invest in targeted campaigns – through both digital and traditional channels – to help create demand for Australian wool amongst consumers in key markets across the world. Australia sells all its wool; what is important is that we promote wool as a premium fibre for which consumers are willing to pay a premium price. These premium prices then flow through to Australian woolgrowers, as we have seen with the recent EMI levels. In line with our strategic plan, we have continued to promote wool through our menswear and womenswear fashion programs – defending traditional markets like suiting but also exploring opportunities in new markets. The sports, outdoor and athleisure markets are especially exciting markets that are helping drive up demand for Merino wool. We have been increasingly collaborating with leading manufacturers and brands in these sectors to promote the premium natural benefits of wool as a performance fibre. The exceptional quality demonstrated by the designers at this year’s International Woolmark Prize not only reinforces the strength of the award but also proves Australian wool’s relevance on the global stage. The initiative continues to help put wool back on the agendas of fashion designers across the world, and consequently into retail stores for consumers to purchase. The natural, renewable and biodegradable benefits of wool continue to be highlighted in much of AWI’s marketing, most notably in the Campaign for Wool, to help sell wool products from luxurious fine Merino wool apparel to attractive interior products using broader microns. Research and development Investment in R&D and extension by AWI in its Sheep Production and Woolgrower Services portfolios increased by 27% last year, delivering a range of outputs to help woolgrowers improve their on-farm productivity and profitability. For example, ongoing investment in Lifetime Ewe Management training has resulted in more than 4,300 producers undertaking the hands-on course since the program began. In addition, this year we’ve rolled out three new workshops to increase woolgrowers’ flock performance: Realising Performance Potential, RAMping up Repro and Winning With Weaners. Our woolgrower networks in each state also continue to provide many other opportunities for woolgrowers to get involved in practical extension programs. Our animal health programs have seen significant and incremental progress reported from a wide spectrum of research projects and trials conducted on farms and in laboratories. Using data generated from AWI-funded research, the pain relief product Buccalgesic® was this year approved by the APVMA for mulesing. In other on-farm R&D programs: the field days at the five Merino Lifetime Productivity sites proved popular with woolgrowers; the total number of current and past wild dog control groups supported by AWI rose to 171; and the development of AWI smart tags and cost- effective wireless connections progressed. While AWI continues to fund shearer and wool handler training aimed at increasing productivity, skills development and professionalism, AWI this year also began taking a new look at automated shearing. In the off-farm R&D area, we have added to the growing number of research findings supporting the health and wellbeing benefits of wool products. We have also worked with leading brands such as adidas and Max Mara in new product developments. I am very proud of the progress that AWI has made during the year across the whole supply chain for Australian wool – from wool-growing through to retailing – and I am confident that the company is set up well so that we can build on these gains into the future. Stuart McCullough CEO, Australian Wool Innovation 31 August 2018 UP FRONT 9
AWI Annual Report 2016-17