THE 2pc wool levy paid by Australian woolgrowers will definitely stay in place until 2009, after the

24 Apr, 2007 08:45 PM
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Federal Agriculture Minister Peter McGauran and AWI chairman Ian McLachlan confirmed this week that the 2006 WoolPoll result would not be reviewed because of the merger announcement.

³I have no power to initiate a wool levy poll, which includes an extraordinary WoolPoll,² Mr McGauran said.

Under the Wool Services Privatisation Act 2000, it is the responsibility of AWI to conduct the poll at least every three years.

³Following a decisive vote in WoolPoll 2006, I agreed to the industry¹s recommen-dation that the wool levy remain at 2pc until the next poll,² Mr McGauran said.

However, until the merger was sealed, there was provision for the levy to be reviewed or changed.

Mr McLachlan confirmed June 30 had been earmarked as the merger date.

³This has been a long, drawn-out affair,² he said.

The integration between the two companies was first mooted in 2005 at the International Wool Textile Organisation conference in Tasmania.

³As part of this process to achieve a speedy integration, the two companies agreed to cooperate rather than compete,² Mr McLachlan said.

³The process of integrating will involve a lot of work and I am sure that there will continue to be the same level of cooperation between the two companies.²

WAFarmers Wool Council president Max Watts said there was no need to hold an extraordinary WoolPoll because of the merger.

³We need to work with what we¹ve got and what levy payers asked for,² Mr Watts said.

The last three polls cost about $1 million each.

Many WA wool lobby group representatives described WoolPoll panel roadshow attendances as poor.

³I certainly don¹t want the industry spending another heap of money for another WoolPoll,² Mr Watts said.

³I think it¹s ridiculous what it¹s costing us and I¹d like to see it stretched out further than three years.

³It makes it a very expensive democratic process with the amount of support we get at roadshows.²

Mr Watts admitted AWI¹s increased off-farm budget might still be a sore point with woolgrowers unhappy about AWI spending 60pc of its budget off-farm.

³They¹d obviously prefer the 50:50 split,² he said.

³But with the merger we¹re now going to reduce duplication and alleviate any undermining that may have happened around the world with two different companies.²

Mr Watts said the merger signalled the beginning of a united and more collaborative approach to cost-effective research, development and marketing.

³The potential benefits to Australian woolgrowers from the eventual merger are huge,² he said.

³I am confident the announcement can be a catalyst to a very successful future for our industry.²

The Pastoralists and Graziers Association (PGA) strongly supported a wool levy for on-farm research and development and were cautious when industry pushed for more funding toward wool marketing.

PGA wool committee chairman Digby Stretch said he would not support an extraordinary WoolPoll because of the AWI-AWS merger.

³We still support the levy, as long as the expenditure of it will be what we voted for in WoolPoll,² Mr Stretch said.

³But they are going to have to be very clear and precise with their accountability.

³No one has really proven to us yet that there¹s a serious correlation between spending money on marketing and the wool prices of the day.²

The government¹s $15m lifeline would see AWI purchase a number of AWS¹ key assets including The Woolmark Company and Woolmark logo, wool product technologies and the AWS market intelligence business.

³They will have to be very careful how they use that Woolmark logo,² Mr Stretch said.

³While it¹s well recognised, it does have some negative connotations.²

The merger is expected to instigate unprecedented growth in AWI¹s wool marketing strategies.

AWS chairman Barry Walker said Woolmark licensees around the world should be heartened by the merger news.

³We appreciate their continuing investment in the brand and are pleased to say that they can have much confidence in its future evolution,² he said.

³No doubt, the merger will mean a reinvigoration of the iconic Woolmark.

³The next step will be for the two companies to work closely together, determining a timeline and process for integration.²

The result of The Woolmark Company¹s US test marketing campaign was expected this month but has been delayed by the merger activities.

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