AWEX review shuts auction rooms

31 May, 2006 08:45 PM
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THE Australian Wool Exchange (AWEX) board has decided to move away from providing wool auction rooms in Sydney and Melbourne by the end of the year.

By discontinuing the provision of auction rooms, AWEX will no longer operate as a landlord.

The role was deemed administrative, and both members and the board believed it did not contribute to the core functions of AWEX.

AWEX chief executive Mark Grave said although it would discontinue the provision of auction rooms as an independent organisation, AWEX would still manage day-to-day wool trading administration in the eastern states and WA.

The move will not affect WA selling facilities, which are operated by the respective brokerage companies and not AWEX.

The nation's core wool services body is now likely to boost resources allocated to managing wool standards and compliance, after a major review of the company's operations.

The provision of the electronic wool offer board was expected to be withdrawn by August.

AWEX will also recommend to members the board be reduced from ten to four directors.

This would still include supporting the National Auction Selling Committee, administration of wool sales rosters and pre-sale information, Mr Grave said.

He said the strategic review concluded AWEX's core services were critical to serving the best interests of its members and the industry as a whole.

Mr Grave confirmed AWEX's commitment to wool quality and providing independent wool information, independence, accountability and transparency.

"The review, which included in-depth consultation with members and stakeholders across the entire industry, found our core services are seen as vital for the wool industry," Mr Grave said.

"It found these highly-regarded services are required as a basis for underpinning the reputation, confidence and price advantage of Australian wool.

"This means AWEX will maintain its focus on wool standards and compliance.

"As well as wool classer education, wool description and appraisal and market reporting.

"And it will actually strengthen the resources allocated to these activities in the future."

AWEX started operating in 1993 as a service organisation focused heavily on trading, specifically auctions.

Mr Grave said AWEX's services had since expanded and a review of its functions and delivery had been timely.

He said AWEX would work with members and continue to support them, to ensure they were not disadvantaged during and after the transition from AWEX provided auction rooms and electronic offer boards.

AWEX chairman Allan Farrar supported the decision by the board to allocate more resources to the provision of core services and to discontinue non-core services.

"The goal of the review has been to align the services that we provide with the best interests and needs of our members, and the industry as a whole in the future," Mr Farrar said.

"The review has served as a litmus test for the good of industry and identified those services which meet the expectations and best interests of the wool industry.

"The challenges in today's wool industry are many and it was imperative that this strategic process looked at serving our members and the entire industry, well over the longer term."

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