Wool stoush ‘positive’!

He says plenty of backing has emerged to keep going.

"We have had a strong acknowledgement of support not only from growers, but from the industry in NZ and globally," Shadbolt told Rural News.

"They are saying 'keep at it, you've got a good model, it is helping the wool industry'. The outcome of the publicity has been very positive towards us and we are encouraged by that support."

The criticism has come from former Wools of NZ chief executive Ross Townshend who left the company in March last year.

Shadbolt says he doesn't know what's behind Townshend's criticism and doesn't want to waste any time thinking about it.

"The more time we waste on negative actions such as this, the less time we spend on ensuring the company is in a strong and robust position... it probably makes us more determined than ever to succeed."

Townshend admitted to the Rural News there had been a falling out between the two, but said that was "irrelevant".

"These guys in my view can't survive the end of Wool Market Development Commitment (WMDC). In the middle of 2018 when WMDC stops there won't be enough cashflow in the business to keep it going – simple as that."

Townshend points to the projected maiden profit of $600,000 this year – and the loss of $3 million in WMDC funding in two years. He supports Wools of NZ as a concept, but believes it should merge with NZ Merino.

"I have a view about how Wools of NZ will fare after June 2018 and Shadbolt has a different view; only one of us can be right."

Shadbolt says they have known from the start that June 2018 is a target time, given the WMDC will cease then.

"We are confident we will be in a strong position come June 2018 through increased commercial activity in and around our direct to scour.... We have just launched a tender platform which is off to a good start. It will be based on that and our lambswool contracts we have had in place for several years."

Other commercial activity will be linked to technology such as Oritain traceability, GlacialXT and Kiteq which had attracted government investment to get products to market faster.

"These provide us with a huge opportunity which differentiates our wool. All that together will put us in a strong commercial position.

"The level of support we are getting from growers means we are getting a higher take of WMDC than we envisaged. That is good for our current revenues but the focus is on growing the business commercially.

"Growers want to see a sustainable wool industry alongside the meat industry, otherwise we are not going to have a sheep industry left."

Townshend says he "couldn't possibly comment" on whether he knew if NZ Merino wants to by Wools of NZ.

"But logically it would make sense for both companies. Wools of NZ would then have international sales and marketing capability beyond what it currently has."

Shadbolt says the fact that Wools of NZ 100% is grower-owned is highly significant.

"In the international marketplace our customers want to link as closely as they can to the grower to ensure they have a sustainable supply of wool.

"The more of the international customers we bring to NZ and get onto our farms, the more opportunities are created. "That's a positive outlook for our growers."