Spearwood faces axe

30 Jan, 2008 09:00 PM
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WESTERN Australia’s only wool selling centre in Spearwood could close this year.

Elders is pushing for the WA and NSW and centres to shut in favour of a single operation in Melbourne.

Elder’s wool general manager Mark Rodda said the industry had been consolidating with the continued decline in wool production.

“That’s growers, brokers, exporters and traders, let alone testing houses, service groups and wool handlers,” Mr Rodda said.

“No one can afford to continue with unnecessary overhead costs across a number of wool selling centres with less wool.

“It is the grower that ultimately carries the cost.”

It also made sense to not only be selling wool from one centre but every day of the week, instead of selling for just six hours a week in some cases, he said.

“It would be better for trade, better for price discovery, better for the futures trade,” Mr Rodda said.

“We need to also understand that were the wool is grown bears no resemblance to where it is sold.

“The physical storage of wool is very different to where the wool sample is displayed and sold.

“A lot of South Australian, Tasmanian and New South Wales wool is sold in Melbourne already.”

Melbourne made the most sense as the single centre out of all the national centres, Mr Rodda said.

“The biggest volumes are grown in the south of the country, the infrastructure is right there and office space compared to Sydney is half the cost,” Mr Rodda said.

“Sure there is room for the regional or specialist centres, such as Launceston or Newcastle, but it is time for a change.”

However, Elders has come up against opposition from Landmark, its partner in the Australian Wool Handlers storage, handling and auction business.

Landmark national wool market development manager Kym Gunn said it currently had a strong market share at auction centres and it was not interested in moving to one centre.

Landmark WA wool manager Tim Edwards said Landmark’s focus was totally committed to achieving maximum returns for its clients and continually improving its wool marketing services.

“Landmark believes that to date the Australian wool industry at large has not reached a majority consensus currently either for centralisation or against centralisation,” Mr Edwards said.

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