Growers encouraged to cast vote

Growers encouraged to cast vote

Sheep
Chairman of the independent WoolPoll 2021 panel, Corrigin woolgrower and Claypans Merino stud co-principal Steven Bolt, is urging every eligible woolgrower to have their say on the wool levy rate by voting in WoolPoll later this year.

Chairman of the independent WoolPoll 2021 panel, Corrigin woolgrower and Claypans Merino stud co-principal Steven Bolt, is urging every eligible woolgrower to have their say on the wool levy rate by voting in WoolPoll later this year.

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Voting in WoolPoll 2021 opened on Monday, September 13, and closes on Friday, November 9.

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AS Australia's Merino wool industry recovers from the COVID-19 pandemic's impact on consumer markets around the world, an informed decision on the next wool levy rate at WoolPoll 2021 will be critical.

That is the considered opinion of Corrigin woolgrower, co-principal of Claypans Merino stud and director of The Livestock Collective, Steven Bolt.

Mr Bolt is also chairman of the independent WoolPoll 2021 panel.

He and the other seven panel members - WA has two representatives, Michael Wright who manages a large sheep enterprise at Boyup Brook is the second - were tasked with preparing relevant information to be sent to woolgrowers to enable them to make that informed decision.

The voter information pack the panel has prepared was, Mr Bolt said, the result of "some robust discussions" by a "really quality panel".

Despite the risk of COVID-19 lockdown and travel restrictions, panel members managed face-to-face meetings in Adelaide and Sydney to thrash out what they wanted included in the information pack.

Its content has gone to Federal Agriculture Minister David Littleproud for approval - Mr Littleproud is the minister administering the Wool Services Privatisation (Wool Levy Poll) Regulations 2003 - and woolgrowers should look for the voter information pack in their postbox early next month.

Eligible woolgrowers will automatically receive the pack and be asked to select one or more from five levy rate options presented and vote for them in order of preference.

There will also be a supplementary question, included after adoption of recommendations from last year's Department of Agriculture, Water and Environment (DAWE) review of WoolPoll processes.

It will ask whether woolgrowers wish to retain the current three-year WoolPoll cycle or would prefer WoolPoll to move to a five-year cycle.

Voting in WoolPoll 2021 opened on Monday, September 13, and close on Friday, November 9.

As with previous WoolPolls, Link Market Services will conduct the vote count and the next wool levy rate - to take effect from July 1 next year - will be announced at the Australian Wool Innovation (AWI) annual meeting on Friday, November 19, once it has been approved by Mr Littleproud.

Voting is not compulsory, so Mr Bolt's and Mr Wright's role is also to encourage as many eligible WA woolgrowers as possible to participate in WoolPoll and have a say on the levy, which is the major funds provider for AWI's research, development and marketing activities.

All woolgrowers who have paid $100 or more in wool levy, deducted from income from sales of greasy wool in the past three financial years, are entitled to vote in WoolPoll 2021.

They will be allocated one vote for every $100 of wool levy they have paid in that time.

As part of advocating WoolPoll participation, Mr Bolt and Mr Wright plan to attend as many regional industry events as possible until early November, including ram sales, the Rabobank WA Sheep Expo & Merino Ram Sale at Katanning, Dowerin GWN7 Machinery Field Days and Newdegate Machinery Field Days.

"Michael and I encourage any woolgrowers who might have questions about WoolPoll to come up and talk to us at any of these events," Mr Bolt said.

"I think this WoolPoll is extremely important and my role as chair of the panel and the roles of the rest of my team on the panel is to connect with growers and get that engagement with the process," he said.

"It's highly important that growers take the opportunity to vote and have their say on the levy and the future direction of our company (AWI).

"Gauging from growers who have been talking to us, I do think there is a level of interest.

"There was a change of levy rate last time (WoolPoll 2018) and that was the first time the rate had changed, so I do think there will be a lot of interest and engagement from woolgrowers in this WoolPoll."

WoolPoll 2018 created history, with woolgrowers casting 13,506 votes for a narrow 52.82 per cent majority on the third preference distribution, supporting an unprecedented cut to the wool levy rate from a long-standing 2pc to 1.5pc of growers' greasy wool sales income.

By coincidence, that levy vote occurred at a time when wool prices across Australia were setting 42-year record highs.

Australian Wool Exchange (AWEX) statistics show regional market indicators and micron price guides at its Western Wool Centre, main Melbourne wool selling centre and Sydney centre mostly reached their modern-era top prices in August and September, 2018, with a few broader micron guides topping out the following February.

The benchmark Eastern Market Indicator (EMI) average for the 2018-19 wool season was a record 1944 cents per kilogram clean, well above AWI's conservative estimate of 1865c/kg used to prepare its budget for that financial year.

But, by the time the 1.5pc levy rate took effect from July 1, 2019, wool prices had plummeted - the EMI average for 2019-20 was 1459c/kg and it slipped further again to 1206c/kg last season, according to AWEX.

Compounding the impact of the price slide was a sharp decline in volume of wool produced due to severe and extended drought across parts of Queensland, New South Wales, northern Victoria and South Australia.

Australian Wool Production Forecasting Committee final estimates for 2018-19 were 300 million kilograms of wool produced and 72.5 million sheep shorn.

The committee's final estimates for 2019-20 dropped to 284mkg of wool produced and 68.6m sheep shorn, while its latest estimates for last season are 290mkg of wool and 65.5m sheep shorn.

As detailed in AWI's 2019-20 annual report, the combined impact of the reduced levy rate, plus a smaller national wool clip was dramatic.

AWI's wool levy revenue plunged from just over $68m in 2018-19 to $37.8m in 2019-20, with a corresponding drop in total revenue from $101.1m to $69.2m.

AWI's latest annual report, to be released ahead of this year's annual meeting, will reveal whether its projection of a further drop in total revenue to $41.8m in 2020-21 was accurate.

AWI did what it could to mitigate the impact of the revenue cut, directing levy revenue into research and development where it attracts matching Federal government funding.

It drew on reserves - $8m according to retiring chairwoman Colette Garnsey in the 2019-20 annual report - to fund a significantly reduced wool marketing campaign and the remainder of its activities.

"We're pretty fortunate AWI had significant reserves in place, we've drawn down on those reserves pretty heavily," Mr Bolt said.

As a market-aware wool producer, he personally believes the COVID-19 pandemic has tended to focus some consumers' attention on broader ethical and sustainability issues relating to lifestyle and products they purchase and use.

Ideally, Mr Bolt believes, the wool industry through AWI should be in a position to capitalise on changing consumer sentiments as Australian Merino wool's retail markets, particularly in the northern hemisphere heading towards next autumn and winter, begin to recover from the impacts of COVID-19.

"Consumers are becoming increasingly aware about how products are produced and what effect they have on the environment," Mr Bolt said.

"Wool is a natural fibre and it has a lot of beneficial credentials that should be marketed now."

Mr Bolt is "extremely positive" about Merino wool's immediate prospects.

"We're having a really good season in Western Australia so we'll see an increase in wool cut per head this year," Mr Bolt said.

"We're all aware a big number of breeding stock was sold off in the previous 18 months, but with good lambing numbers hitting the ground this year - there's been some exceptional results coming through from growers - our level of sheep numbers will stabilise this season and then start rebuilding back to what they were pre-2019.

"I could potentially see an increase on our average lambing marking rates this season of up to 10pc.

"That number alone will see us within a season of returning those sheep that were shipped out in the past 18 months."

As WoolPoll 2021 panel chairman, he cannot advise woolgrowers on any particular levy rate option they should choose.

His advice is that all woolgrowers should consider their opinions on industry funding carefully in the leadup to WoolPoll, read the material the panel has provided, select the option they think will best serve the industry into the future and vote for it before the deadline.

Mr Bolt pointed out recommendations from the DAWE review had determined what four of the five levy rate options would be.

"Government regulations require that the current levy rate is an option - which is 1.5pc - as well, half a per cent below and above the current rate also have to be a levy option - so 1pc and 2pc," he said.

"A zero rate also always has to be an option.

"AWI has the option of putting in a fifth levy rate choice, which they have of 2.5pc."

The Voter Information Memorandum put together by the panel as part of the WoolPoll information pack will outline for each of the five levy rate options, the likely projected expenditure by AWI on activity areas of education, marketing, onfarm and off-farm research and development, Mr Bolt said.

"Growers can look at the different rates and see what spend they will get for each in the different areas of their company's operation and they can compare," he said.

"They can then say 'I like the look of that one' and make an informed choice.

"We've tried to include as much information as possible so growers can do that."

Mr Bolt pointed out that under the reviewed and amended WoolPoll regulations AWI is not permitted to declare a preference or put its case for a particular levy rate option on the Voter Information Memorandum.

AWI has declared a preference for a return to a 2pc wool levy rate and it has the option to explain its support for 2pc or comment on any of the options in a separate document to be included in the voter information pack, he said.

Mr Bolt said he expected AWI to provide such a document to be included in the pack before it is mailed out to woolgrowers.

"In a standalone document included in the voter information kit, AWI will no doubt discuss its preferred option - AWI has added a fifth levy rate option, but that is not its preferred option," he said.

Also following the DAWE review, the WoolPoll panel this year is required to engage more with woolgrowers on social media and digital platforms to drive engagement.

"We know most growers are engaged on social media platforms, either as part of their business or socially, so it makes sense to use all the access points to touch base with growers and alert them to the upcoming WoolPoll and encourage them to sit down as a business and go through the information and make an informed vote for the future of the company (AWI)," Mr Bolt said.

The content for a 'digital roadshow' on WoolPoll 2021, suggested by the DAWE review, has already been filmed on his farm.

This year the panel plans to deliver on its aim of ensuring woolgrowers cannot ignore WoolPoll.

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