Improved Marketing of Mohair Fibre

Transcription

1 Improved Marketing of Mohair Fibre A report for the Rural Industries Research and Development Corporation by Christopher Cull Maroombra Management Services January 2000 RIRDC Publication No 99/179 RIRDC Project No MMS-1A

2 2000 Rural Industries Research and Development Corporation. All rights reserved. ISBN ISSN Improved Marketing of Mohair Fibre Publication No. 99/179 Project No. MMS-1A The views expressed and the conclusions reached in this publication are those of the author and not necessarily those of persons consulted. RIRDC shall not be responsible in any way whatsoever to any person who relies in whole or in part on the contents of this report. This publication is copyright. However, RIRDC encourages wide dissemination of its research, providing the Corporation is clearly acknowledged. For any other enquiries concerning reproduction, contact the Publications Manager on phone Researcher Contact Details Christopher Cull Maroombra Management Services PO Box 135 ARMIDALE NSW 2350 Phone: Fax: mohair@abri.une.edu.au RIRDC Contact Details Rural Industries Research and Development Corporation Level 1, AMA House 42 Macquarie Street BARTON ACT 2600 PO Box 4776 KINGSTON ACT 2604 Phone: Fax: rirdc@rirdc.gov.au Internet: Published in January 2000 Printed on environmentally friendly paper by Canprint ii

3 Foreword The current system of collection and sale of mohair fibre in Australia has been operating for some time within an industry that has experienced a steady decline in production over the last decade. This research project was commissioned by the RIRDC to analyse and report on alternative/additional marketing systems for mohair fibre, with the aim of facilitating discussion and identifying ways in which the mohair industry in Australia might be revitalized and Australian mohair might be more successfully placed in the world market. This report reviews previous research initiatives within the industry, describes and analyses the current marketing system and outlines the ways mohair may be processed in the light of its fibre characteristics. The report identifies a number of potential marketing initiatives for example, through innovative processing and product development and the use of the Internet as a trading exchange. However, more importantly, this report suggests a broad series of practical and achievable tasks which can be undertaken by each segment of the industry to overcome the problems it faces, create the environment for a sustained improvement in the marketing of mohair, and instill optimism in the future of the fibre in Australia. This report, a new addition to RIRDC s diverse range of over 400 research publications, forms part of our Rare Natural Animal Fibres R&D Program which aims to facilitate the development of new and established industries based on rare natural fibres. Most of our publications are available for viewing, downloading or purchasing online through our website: downloads at purchases at Peter Core Managing Director Rural Industries Research and Development Corporation iii

4 About the Author This research project has been undertaken by Maroombra Management Services, a financial management and marketing consultancy business located at Armidale, NSW. Principal of the firm, Chris Cull, has carried out the work on behalf of RIRDC and the mohair industry in Australia. Chris has had considerable experience in the rural sector having operated his own grain and livestock producing enterprise in northern NSW and being actively involved in various rural bodies. In 1984 he relocated to Armidale where he ran two retail businesses and developed a commercial real estate investment. He now operates his own marketing and financial management consultancy business. Since 1997 he has managed Mohair Australia on a part time basis successfully overseeing the organisation s relocation to Armidale and turning its financial performance around. iv

5 Contents Foreword... iii About the Author...iv Executive Summary...vi 1. Introduction Previous Reports Overview of the Current Marketing System Mohair Processing and Fibre Characteristics Recommendations Conclusion Indicative Budget Appendices Glossary of Terms Bibliography v

6 Executive Summary Production of mohair in Australia has decreased markedly in the past ten years from close to one million kilos in 1988 to just over 300,000 kilos in It is uncertain whether this trend will continue. The reduced amount of fibre coming forward for sale has impacted adversely on the service industry (the brokers and buyers) and on the local processing industry where there is now a lack of interest in mohair with the exception of one or two customers. The reduced volume and relatively lower prices has made handling mohair an unviable business in some instances. While the adoption of imported genetics from South Africa and Texas has seen a dramatic improvement in mohair fibre this has not been universal and the national clip is still of variable overall quality. This variability has resulted in reductions in handling efficiencies, the need to blend lots to reach exportable quantities and a mistrust of Australian mohair by processors. The industry also suffers the effects of poor communication between producers and processors. Under the present system the buyers are the people who have contact with both groups but the information flow is inconsistent and there is a certain amount of confusion as to definitions of quality and processor specifications. As a result of these constraints, the basic elements required for successful marketing are not present in the Australian mohair industry. To successfully promote and sell mohair the following criteria need to be satisfied:- producing a product which is uniform and easily identifiable supplying a product which meets the customers (processors ) specifications delivering it in the right quantities, at the right time and in the right place being alert to changing market signals and being able to respond to them Like many other primary industries the growers of mohair tend to focus on the production and supply of fibre in the hope that someone will want it on sale day. There is insufficient industry knowledge about processor requirements and a lack of universal commitment to meeting these requirements. While there are some studs and commercial producers who are attempting to anticipate processor requirements and who are modifying their breeding programs to improve the quality of their fibre, such commitment is patchy at best. The breed recording program used by Mohair Australia does not include genetic performance criteria nor is having animals of a certain genetic standard a pre-requisite for membership of Mohair Australia Ltd. (MAL). There have been three previous investigations into the Australian mohair industry with varying attention to marketing issues. Many of the observations and some of the recommendations made in this report have been made previously but have in the main not been successfully addressed. There are a number of reasons, ranging from lack of funding to loss of focus and commitment. The brief for this report was to find innovative ways to market mohair. However, the constraints noted above need to be removed and attention given to improving the product being offered before innovative changes can be implemented. The report therefore seeks to identify a series of tasks which can be undertaken immediately to improve: the quality and presentation of the clip, the collection and selling system, communication between producers and processors, promotion of Australian mohair fibre, and increase the level of local value adding. There is a deliberate attempt to identify tasks which will be beneficial, which will instill some optimism and which can be undertaken in the short term, given the limited resources of the industry. The mohair industry can be described as being divided into three loosely grouped segments. The producers are in one, the processors in another, and the garment manufacturers, retailers and consumers in the third segment. The general thrust of this report embodies the notion that the producers and processors need to see themselves as operating in the same segment. They should be vi

7 working together to achieve common objectives, i.e. to satisfy the needs of the consumer driven segment. (It is important to remember that consumers are not just fashion focussed, they may be in any section of the market, requiring a range of fibre based products.) Having this broad objective in mind the major recommendations can be summarised as follows: - 1. Reach an understanding of what is meant by quality mohair with particular reference to the requirements of processors. Once specified, Mohair Australia should undertake to promote the breeding of animals and production of fibre that satisfies these specifications. 2. Seek clear market signals by improving the transfer of information along the mohair fibre chain including communication of specific needs by consumers and processors, market reporting and promotion to processors. Development of an Internet site may be part of such a program. 3. Mohair Australia to foster the development of an effective advisory committee to replace the existing Trader Division, with the objective of improving its relationships with brokers, buyers and processors and to gain their input on a range of industry matters. 4. Seek the appointment of an Industry Liaison Officer whose role would be to facilitate arrangements aimed at increasing local value adding activities using mohair and mohair rich products. (Funded by MAL, RIRDC and industry.) 5. RIRDC, Mohair Australia and others to continue to conduct research into the characteristics and uses of mohair, with particular emphasis on blending with other fibres such as fine wool and synthetics. The Australian mohair industry needs strong leadership at the present time. Leadership which will draw the various segments together to pursue common objectives, one of which is to implement strategies aimed at improving the marketing of mohair. Mohair Australia is well placed to fulfill this role and to improve relationships throughout the industry to see that the recommendations of this report are implemented. This report is an action focused document designed to stimulate a desire for change and to achieve positive results. Each recommendation is aimed at either improving the product itself (the mohair fibre) or the way it is identified and promoted. It is envisaged that implementation will take place once priorities are established and the relevant parties agree to a course of action. vii

8 1. Introduction The current size of the Australian mohair clip is estimated at 330,000kg 1, significantly down from a peak of 1,000,000 kg in While industry sources talk of a bottoming out, the trend at present remains downward, falling from an estimated 380,000kg in 1996 to the present level. The composition of the clip has also varied markedly since 1988 when new genetics from South Africa and Texas were made available for stud breeding programs and commercial herds. These new genetics have produced a rapid improvement in the quality of Australian mohair on farms where they have been introduced and their superior properties selected for. However, variation in quality is still a major problem for the industry. The relatively small volume of the Australian clip has resulted in a number of significant marketing problems. For example, it:- reduces the overall viability and therefore the capacity of people involved in the collection, selling and exporting process leads to difficulties for processors in building uniform lots, causing excessive blending, lower average price and loss of identity reduces opportunity for local processors leads to a poor understanding of, and lack of interest in, Australian fibre by overseas processors reduces resources available for effective promotion and product development produces returns for Australian mohair producers that appear to be relatively lower than those achieved in South Africa, considered to be the international benchmark Any attempt to improve marketing must take these problems into account and look for innovative ways to identify, collect and market the Australian clip which represents approximately 5% of the world s production. As well as being small, the clip also contains a wide variation in type and quality. It is unlikely, therefore, that effective improvement to marketing will be made if it is considered as a whole. It is more probable that a series of activities will need to be undertaken to improve specific areas of the marketing system with the objective of making small changes that will help restore confidence and stability, attaining price increases in due course. In this report the Australian mohair production system has been examined to identify areas where there are opportunities for improvement, which should yield price increases and/or improved stability for producers and other participants in the industry. The report has focused on outcomes, which are both achievable in the short term and within the industry s capability to pursue, given the financial and physical resources available. There seems little point tackling objectives which are beyond the industry s capability at a time when there is an immediate need to demonstrate capacity for leadership and to restore confidence. To identify opportunities for improvement, the report examines the fibre chain from grower to enduser, seeking to identify factors that influence each participant in the total process. The industry needs to understand these issues and the messages which flow between producers and end users to ensure communication provides clear market signals to all sections of the production and manufacturing process. Where the market signals identify specific needs it is appropriate to ask:- Is the message being passed to the right people? Do we understand what is required? Can we satisfy the request? 1 Source: Mohair Australia Ltd., June

9 Is there a reward for meeting the identified need? Marketing is a process of understanding the needs of individual customers and then, as suppliers, deliberately setting out to fulfill them. It is only when we precisely meet the expectations of our customers that we will be financially rewarded. The report examines the product (the mohair fibre), and the way it is described and presented to those involved further along the fibre chain and seeks to determine whether the needs and expectations of each customer are being met satisfactorily. There have been frequent calls for producers to increase their production. Efforts are also made to entice new people into the industry in an attempt to increase the volume of the national clip. For this to happen, a number of factors will need to be dealt with first. People in the industry will want to feel secure, they will need to operate viable enterprises producing saleable products, and they will need to see examples of success, and of stable, thoughtful leadership. When these conditions are met farmers will respond to the market signal and support a program of promotion and steady growth. It is the objective then of this report to identify factors which will bring a positive influence to the industry and recommend actions which will lead to the attainment of realistic goals. 2

10 2. Previous Reports Before undertaking this investigation into the marketing of Australian mohair it is appropriate to comment on previous reports where they have dealt with this aspect of the industry. There have been three significant documents prepared since 1988, commonly referred to as the ACIL Report, the Skillecorn Report and the McIntosh Report. The scope of each of these reports was wider than the present investigation and incorporated Mohair, Cashmere and other goat products such as hides and meat. A brief summary of each as they are relevant to the present project follows. 1. ACIL Report (1987) Origin This was an initiative of the Goat Industry Committee of NSW Farmers Association submitted to Australian Special Rural Research Fund for funding on a dollar for dollar basis with producers. Brief A statement of the general aim of the study prefaced the terms of reference, namely, To examine the existing structure of the goat industry in Australia and develop an appropriate set of marketing arrangements for the industry, having regard to: - structure of the local producing industry product and market characteristics general market opportunities for these products over the next decade. 2 Notes World production of mohair fibre in 1986 was 20,000,000 kilograms with Australia contributing just over 600,000 kilograms. The outlook for worldwide (including Australian) production was promising and the industry was optimistic about the future. The marketing structure at the time of the report involved five wool brokers and two specialist Mohair brokers. This organisation was judged as inefficient and uncoordinated with poor market information available to the industry. A fundamental failure in the current arrangements is the inability of the system to provide information to both buyers and sellers: information about the qualities of the product on offer, markets and market changes in textile user requirements, and production and sale volumes in Australia. 3 Major Recommendations of the Report Establishment of a Mohair Industry Policy Council to coordinate sales, provide supply information to buyers, set classing standards, market reports and to provide a general industry forum and lobby group. Form a company, Mohair Marketing Ltd, to coordinate market research, product development and promotion. Form a Goat Fibre Research Council to conduct industry research. It was proposed that a levy be collected to fund these bodies. Comments After ten years much of the Report is still relevant, especially the detailing of problems facing the industry such as the lack of market focus, poor reporting, unclear quality standards, etc. It is 2 ACIL Australia Pty Ltd, Mohair, Cashmere and Goatmeat Marketing Arrangements, 1987, p ibid., p

11 worthwhile noting that the most significant problem identified was the lack of clear market information for producers a problem that still exists today. Marketing information, and more particularly analysis, is a major deficiency of the current arrangements growers have little information as to why prices change or the reasons for the changing relative prices of different qualities of Mohair. 4 Perhaps what puzzles growers most is not knowing, with confidence, what combers, top makers and the weavers really want in terms of Mohair quality. 5 Improved market information is probably the most commonly cited means of reducing uncertainty and hence risk. 6 The Report also made consistent and frequent reference to the need to develop a strong commercially focussed industry body to facilitate marketing and promotion and to change industry orientation. After a decade, these objectives are all still to be addressed as Mohair Australia has continued to be primarily concerned with the needs of its Breeder members and few resources have, until now, been given over to marketing the fibre. 2. The Skillecorn Report Goat Fibre Industries in Australia (1993) Origin Initiated by RIRDC Goat Fibre Research & Development Committee Notes In 1993 production was estimated at 550,000 kg, down from almost 1,000,000 kg in The Report included extensive statistics and information pertaining to production, processing and manufacture as at Although it is hard to obtain exact information today, these figures have generally decreased. Problems Identified for Mohair in the Report the small volume produced, therefore no influence in international market a general lack of local knowledge about Australian mohair, which was therefore overlooked within Australia by processors and garment manufacturers sales severely discounted because of high levels of kemp and other imperfections in the fibre (now not a universal problem) the loss of clip identity because of blending with fibre from other countries with only one buyer active at the time, there was a poor flow of information from processor to grower Recommendations of the Report To establish a viable Australian goat fibre industry through the development of an Australian goat fibre processing industry marketing its products both locally and overseas by using appropriate systems that provide benefits to all participants." 7 Important components of the strategies derived (from this recommendation) were the development of linkages between all sectors of the industry, and that the industry should continue to foster and fund further product development. 8 4 ibid., pp. ii, iii. 5 ibid., p ibid., p J.J. Skillecorn, Goat Fibre Industries in Australia, 1993, pp. vi-vii. 8 ibid., p. vii. 4

12 The identification of target markets for goat fibre products and the translation of these markets into yarn requirements and specifications, and further back into fibre specifications, is becoming a major exercise. The textile industry around the world is fairly fragmented, with the processing pipeline from grower to consumer a very long one, and with the end consumer market categorised into numerous niches. 9 The consultants viewed that this requires the appointment of a Market Development Officer who can provide the market and industry intelligence (and in the process identify the relevant market niches in fabric, yarn and top), the technical expertise across all facets of the industry, and who can initiate and encourage product development and link more closely the research and development process to the needs of the industry 10 Without a professional Market Development Officer, the above tasks are let out to an array of people who are not always skilled in these areas, with the result that the industry proceeds in an haphazard and uncoordinated way E J McIntosh A Development Program for the Cashmere & Mohair Industry (1997) Origin This project arose from the major recommendation of the Skillecorn Report i.e. that a Market Development Officer be appointed to encourage the expansion of local value adding and processing of mohair and cashmere fibres. The project was funded over a three year period by RIRDC. Notes After the appointment was made and initial investigations carried out there seems to have been a change in the focus of the project, influenced by the sharp increase in world demand for mohair fibre that signalled a need to increase volume and the decision to expend resources restructuring the industry, ultimately leading to the formation of MAL. In hindsight the failure of this program to address the original objective of producing mohair of superior processing quality and developing the local value adding industry has been a significant contributor to current ongoing problems. Quality should always take precedence over quantity in order to achieve long term marketing success. This issue has been raised again in the current report. General Comment All three reports identified the need to improve mohair quality and to expand local value adding opportunities. They highlighted the uncoordinated nature of the industry, especially where marketing the fibre is concerned, and made recommendations to address these shortcomings. While the overall coordination of the mohair industry in Australia is potentially improved with the existence of Mohair Australia in reality the industry is still fragmented with little progress toward common goals and agreement as to standards and objectives. This fragmentation and resulting lack of effective communication continues to have a significant impact on efforts to improve the marketing of mohair fibre as will be discussed in the present report. 9 ibid. 10 ibid., p. viii. 11 ibid., p

13 3. Overview of the Current Marketing System Like most rural industries, and certainly the animal fibre producing industries, the production and marketing of mohair in Australia is currently experiencing a period of low demand reflected in poor returns for producers and others involved in the industry. The industry has been contracting during the past ten years. All sectors are affected and each has its own problems. As noted above, this report seeks to identify problem areas in the marketing process and suggest ways in which some of these issues can be addressed and the system improved. Producers The marketing issues facing producers are varied and complex. The problem of overall viability is the major burden but there are a number of areas that can also be identified and improved. They range from an uncertain understanding of processors requirements, mixed signals as to what is meant by quality fibre, variable prices, problems dealing with brokers and buyers and mixed commitment to the industry by some growers. While there has been a steady improvement in genetics available to mohair producers during the past ten years the adoption of superior breeding animals is still not universal. Some producers have herds with high level South African or Texan genetics producing good quality fibre. There are others who still have Australian animals with little capacity to produce marketable fibre. The lack of universal commitment to improving and reaching consistency in the national herd exacerbates the brokers problems when trying to build uniform lots for sale and has a negative impact on the overall image of the national clip. While there is a widespread recognition of the need and opportunity to improve fibre quality using imported genetics, most selection methods are still based upon visual assessment of sires at shows and sales. There is insufficient understanding of genetic factors (eg. fibre diameter, staple length, staple strength etc.) which can be bred into a herd and selected for. It is important that growers are able to identify and purchase bucks that will improve both fibre diameter and fleece yield. The stud breeders can make genetic improvements in these areas and should be encouraged to market their animals for herd improvement with objective performance data available at the point of sale. Stud breeders and commercial producers must take responsibility for producing fibre, which is fine, of acceptable length, and free of contamination. Despite years of education and training there is evidence that lack of attention to classing and clip preparation still leads to problems for processors. There is not a universal understanding of the affect of even slight contamination in the processing chain, where foreign material causes significant loss of efficiency in the mills. This is a controllable factor and should be eliminated. While individual brokers and buyers have wide experience in preparing the fibre they receive they each have their own classing method and system. There is also variance between the Australian classing system and that used by the major supplier, South Africa. This causes confusion for the Australian producers trying to compare their own fibre and its marketing to that in South Africa. There is an as yet unproven perception among Australian growers that producers in South Africa receive a premium for their clip. The lack of consistent and objective standards when describing mohair is also a problem for producers. The concept of quality fibre is communicated to producers at fleece and animal shows, from brokers feedback, and buyers comments at sale time. There is almost no information flow from processors (who rely heavily on having their specifications met precisely) to producers. When information does flow back it is usually of a subjective nature and open to interpretation by the grower. There is little positive, objective data made available. Producers need to be in touch with both processor and consumer requirements and committed to reacting to trends when they are identified. 6

14 For producers to be able to improve their viability they need to receive appropriate market information, training in clip preparation, access to objective genetic data and education in understanding such things as techniques to maximise gross margins. On a more positive note, there is increasing interest in using objective measurement to describe fibre offered for sale. Lower costs combined with more reliable tests have enabled brokers to incorporate some objective data into their selling systems and market reports. While some buyers may not fully embrace objective measurement it is likely that improved communication between producers and processors will see greater industry acceptance of this sort of information. Brokers and Buyers There are presently three brokers operating in the mohair industry; Fairlie Wools (Brisbane), National Mohair Pool (Cudal, NSW), and Australian Mohair Marketing Organisation (Narrandera, NSW). In recent years there have been only two buyers consistently seeking mohair, Laycocks (Sydney) and Australian Mohair Trading (Melbourne). It is difficult to ascertain the relative percentages of the clip each acquires and both also purchase quantities of mohair direct from growers. While there are inefficiencies and problems in this system and it is tempting to be critical of the structure, it does provide a degree of choice for producers, including:- collection points at centres in each state method of sale (private treaty, pool, auction) payment terms Businesses involved in the collection and sale of mohair are confronted by significant problems at the present time. The low volume produced nationally, small individual clips, variability of fibre type and quality, and the distribution of collection points all impact on their capacity to maintain viable businesses and to provide satisfactory services. The buyer is often required to focus on the need to assemble saleable lots rather than being able to offer acceptable quantities of sought after fibre. This practice has the effect of reducing overall prices as the blended lot usually does not achieve standards that will attract a premium. The nature and distribution of Australian mohair production makes solving some of these problems impossible. However, there are other shortcomings in the system, which should be discussed with brokers and buyers with a view to achieving improvement: 1. The present low production levels have impacted on the viability of brokers in particular. Their businesses are specialised and rely heavily on throughput. Low profitability reduces their capacity to service growers who produce small lots, have inferior fibre types or are significant distances from the main warehouses. The problem of inferior hair is more serious in Queensland where there are higher levels of fleece contamination and higher freight costs. 2. The two buyers are similarly affected by low volume but have other fibre interests (mainly wool) which helps spread risk to some degree. 3. Buyers are frequently cast in the role of lot builders trying to assemble a suitably uniform line of hair, which will meet the processors requirements. Even when a shipment is made it is nearly always blended in the processing chain with a resultant loss of identity and image in the market place. 4. There is a reasonable flow of information from the brokers and buyers to growers based upon the assessment of operators at the classing centres. Post sale feedback is also given. However, there is little or no feedback from processors to growers and so the industry generally has a poor understanding of the specifications required by top makers and spinners in particular. This fosters a tolerance of inferior fibres in the sale process that is detrimental to the image of the overall clip. 7

15 5. Because of the tenuous state of relations between producers and brokers, who rely heavily on the support of producers for fibre, brokers are in some instances reluctant to give adverse advice and comments to producers for fear of losing their clip. This in turn perpetuates the quality problem. 6. As noted above, while there is agreement of broad classifications, brokers and buyers have their own classing systems and subjective interpretation of classing standards. At times this leads to problems between the broker and the buyer who is trying to build a saleable lot. There are instances of mohair being reclassed by the buyer either to build lots of sufficient size or to meet standards, which are perceived to be different. This incurs extra cost with a resultant loss of fibre identity with no opportunity to provide market feedback to the grower. Greater use of objective measurement would assist in this area. There is also variation between the South African and Australian classing systems but the significance of this is uncertain apart from the observed confusion created among producers. 7. In an attempt to facilitate communication among brokers and buyers Mohair Australia has incorporated a Trader Division into its operating structure. The Trader Division seemed to function for the first couple of years after its inception but has not met during the year. Rivalry and mistrust among all the players makes operation of the Division difficult. The future of this group needs to be reconsidered by MAL and the Division members. Early Stage Processors It was apparent, from almost all interviews conducted during this project, that Australian mohair has a poor reputation for consistency and reliability with processors. It is acknowledged that the price paid by overseas manufacturers frequently reflects a discount for risk and for the added cost of blending with fibre from other sources. It could not be confirmed whether the risk is based upon current experience or the historic reputation for Australian fibre being kempy and of inconsistent quality. It seems likely, however, that lots assembled in Australia do still have a significant degree of inconsistency due to the wide variation in geographic conditions where goats are run and the need to pool different deliveries to achieve viable shipping quantities. In any case there is potential to undertake a program to re-promote quality Australian fibre to international processors. The most significant problem that seems to occur at this point in the fibre chain is one of communication. This manifests itself in two ways: first, the lack of information flow from processors to growers and second, the way the fleece is described by processors who use an objective, technical language while others use traditional descriptive terms. Both aspects lead to problems for the marketing of the fibre. 1. Buyers are usually the only people who are directly in touch with the processors. They may be proactive i.e. advising potential clients of the availability of mohair lots or they may be responding to orders for fibre. Because of this relationship the buyer controls the information flow from processor to grower. From discussions held with the two major buyers in Australia, it appears that there is a certain amount of feedback to growers, but this is usually in the form of an opinion given by the buyer or his agent at the time of clip receival or sale. There is no feedback from the processor. As noted above, almost all Australian mohair is blended early in the manufacturing process and its identity is lost, making objective feedback difficult. The buyers assessment is therefore all that can be passed on to growers in the present system. There is anecdotal evidence that where a relationship has been developed between producers, buyers and processors at the local level there was greatly improved understanding of the processors needs by the producer. The buyer involved facilitated the information flow by seeking out specific fibre types from individual producers, which would meet the processors precise requirements thus creating a perfect feedback loop. 8

16 2. Another problem is that the language used by growers, brokers and buyers is essentially subjective, they use terms such as style, handle and character to describe mohair fibre. Processors, on the other hand, use a more technical language based on objective measurement (e.g., micron, micron C of V, hauteur etc.). There is evidence that the duality of language leads to confusion, and in some instances creates a cynical attitude toward the buyers who control the information flow to producers. This was commented on forcefully in the ACIL report (p. 29), Perhaps what puzzles growers most is not knowing, with confidence, what combers, top makers and the weavers really want in terms of Mohair quality. A variation of the communication problem was also seen when, in a recent article in the Australian Goat Report (June 15, 1998), a local processor claimed there was a need to grow sub-21 micron raw fibre to achieve quality. This sparked a debate in subsequent issues of the newsletter as to what was meant by quality fibre, further highlighting the need for the industry to achieve an objective understanding of what is required by processors. An objective definition of quality would give a clear signal to producers of the types of mohair required by processors. Due to the difficult nature of mohair processing a further communication problem exists between processors. The skills and techniques required to process mohair fibre remain closely guarded secrets by those who achieve success, thwarting universal adoption of technology. This leads to duplication of research, added expenses and uneven distribution of skills and opportunity. Late Stage Processors These are the knitters, weavers and garment makers who use mohair either in a blended yarn (knitted or worsted) or, less frequently, as pure mohair. They are the businesses closest to the consumer who respond to the requirements of fashion and consumer needs. It is at this point that market demand is converted to orders for cloth. The signal flows back along the value adding chain from spinner to top maker and ultimately to the producer. Today, there is increasing pressure on the late stage processors to produce cloth, which is light, comfortable and easy care. This translates into a need for finer diameter and low diameter variation in the fibre, both characteristics, which provide comfort and lightness in the finished garment. Producers have no option but to respond to this market signal if they want to sell fibre into the fashion industry, where they can achieve premiums for high quality fibre. Fibre Diameter (micron) Fibre fineness response to customer needs NSW Wool US Cotton 5 Polyester Year Source : adapted by NSW Agriculture 9

17 The above figure shows how the other major competing fibres have responded to the requirement of decreasing the fibre diameter. Mohair is not an easy fibre to process. The flat nature of the scales on individual fibres (which give it lustre) make spinning technically difficult and so it is usually blended with wool or another fibre in the yarn making process. Further work needs to be done to better understand the properties of mohair to find ways to manufacture reliable yarns, which are mohair rich. In recent years there have been significant improvements in machinery in the processing chain, particularly that used by spinners and weavers. Increased processing speeds put a lot more pressure on the fibre as it is being processed and therefore it needs to be of sufficient quality to avoid unnecessary and costly stoppages. There is an expectation by processors that they will be able to purchase fibre that will be dependable and process efficiently. Fibre diameter and strength are the two critical factors in this area. Because of the small size of the industry and restricted resources there is little product development being conducted at the present time. The processor at Seymour continues to experiment with yarn manufacture and the new Geelong plant has indicated a willingness to pursue projects with identified commercial outcomes. A range of experimental work is also being conducted at the University of NSW, Department of Textile Technology, where some lightweight mohair rich cloth has now been successfully manufactured. Because all Australian mohair is subject to blending and subsequent loss of identity there is no opportunity for manufacturers to differentiate their products in the market place. There is no branding as, for example, made from superior Australian Mohair. As a result there is almost no recognition of Australian Mohair by consumers. Again, the low resource base of the industry severely limits product development and promotion of mohair products. The levies collected for this purpose are insufficient to influence consumers. If product development is to be carried out it will need to involve the wider industry through the formation of strategic alliances both vertically (within the mohair industry) and laterally (with other fibre industries). Consumers Considerable resources are needed to conduct an effective program to promote products to consumers in any field. Successful promotions require products that are easily identified, are perceived to have value by consumers and are readily available. Mohair meets none of these requirements at the present time nor the resources to run a sustainable promotional campaign. This report suggests how the image and availability of mohair products can be improved but until this is achieved it is our opinion that promotion of mohair products would not yield a cost effective result. 10

18 4. Mohair Processing and Fibre Characteristics Basically, mohair can be processed on two different sets of machinery, depending on the fibre used and the end product to be made. However, it is an expensive and difficult fibre to process and producers of mohair must ensure that they meet the precise specifications required by topmakers and spinners in particular, if they hope to build a credible relationship with their customers in the value adding chain. The worsted system produces a smooth, sleek yarn for suitings and other light to medium weight apparel where the aim is to have a firm and smooth surfaced, lustrous fabric. The machinery is designed to comb the fibres into a parallel arrangement, using only full length, best grade raw material. In the woollen system shorter fibres are normally used and combing is omitted. This gives a bulkier, hairier yarn, used for heavier fabrics and blankets. The Worsted System After scouring, in which grease, suint, and dirt are removed by washing in warm detergent solutions, and drying, the fibre is fed into the worsted carding machine, which opens up the mohair, removes some burr and seed, and lays the fibres parallel to each other. The carding machine consists of a large number of finely toothed rollers, revolving at various speeds. The film of fibre is then gathered into a sliver, and wound into cans. From here, the sliver is passed through several stages of prepared gillings, which further parallelise the fibres, blending them, and rendering the sliver more uniform. These gillings prepare the mohair for combing, being the next process, having the objectives of removing short fibre, vegetable matter, and fibre tangles called neps. The final stage of the topmaking section of worsted spinning, involves further gilling of the combed sliver, and winds the sliver into balls, usually weighing 10kg or more, called tops. The topmakers supply mohair top to the spinner. Topmakers blend various raw fibres to meet the specifications of the spinner. This decision is based on fibre diameter, staple length, staple strength and the other mohair characteristics. Sliver from tops then undergoes several processes of drawing into finer and finer sliver or rovings, which are then fed to the worsted spinning frame for conversion into yarn. This yarn is then frequently twisted or plied together (spun), wound into cones and supplied to manufacturers for knitting and weaving. The spinners supply yarn to the fabric makers specifications. The specifications of the order are very tight, with specific reference to fibre diameter, fibre length, colour, vegetable matter and dark fibres. Dyeing may take place at a variety of points in the process, either as tops, as yarn or in the final fabric. The Woollen System This system produces a quite different yarn to the worsted system. Although any length of fibre can be used, it is the shorter lines which are most suitable, usually blended with wool, and frequently including the short fibres removed in worsted combing, called noils. After scouring, the mohair is blended, and passes to the woollen card, essentially a double carding machine, designed to ensure thorough mixing of the fibre, and efficient burr removal. Between each unit the fibre is laid transversely to ensure criss-crossing occurs. As the fibre film emerges from the carder it is split into narrow bands which are rubbed into twistless rovings or slubbings. These slubbings pass to the woollen spinning frame, which converts them to yarn. 11

19 Dyeing commonly takes place either before carding on the loose stock, or at the final fabric. Very seedy mohair (over about 3%) is often carbonised using an acid treatment to remove the vegetable matter, and then processed by the woollen system. Late Stage Processing Knitters and weavers supply fabric to the garment makers specifications. These require yarns that meet very tight specifications for yarn count, yarn elongation, yarn strength, uster (yarn thickness) variation and yarn hairiness. All of these characteristics of the yarn are important to avoid imperfections in the fabric. Garment makers supply garments to order that satisfy the retailers needs. They must meet strict specifications for fabric weight, fabric construction, finishing, colour and surface textures. It is interesting to note that all processes in the value adding chain from early stage processors to customers are response to a specific order or requirement from the next unit in the chain. The mohair grower is the only element in this chain producing a product without a specific customer in mind. Fibre Characteristics To a processor, the producer s fleece (their end product) becomes a raw material. As such, the prime considerations of quality and other features pass from fleece and staple to fibre. Except in so far as they influence fibre, factors such as fleece weight, style, character, and fineness for age become unimportant. Fibre characteristics, which should become part of the description of mohair, early in the fibre marketing process are: - Micron and its uniformity - the major determinant of end use, being closely correlated with handle and fineness of spun yarn. (Current spinning industry best practice has found that 40 to 45 fibres in the cross section is acceptable in weaving and still provides a yarn with the characteristics demanded by the weaver. Due to the limit to the number of fibres in the cross section, the only way to achieve lighter weight fabrics is to use fibres of a finer diameter.) - the aim is for below 30% C of V in the top (some growers have achieved C of V as low as 20%) - fibre diameter is the principle determinant of comfort in the final garment. Any fibres with a diameter exceeding 30 micron can cause prickle sensations. Length and its uniformity - the second major determinant of type of spinning process and end use - the mean fibre length in the top (the hauteur) is a specification of critical importance to the spinner and affects spinning efficiency and yarn strength - also affects the prickle factor, the amount of pilling and overall fabric strength Kemp levels - desirably as low as possible giving a wider range of end use, and better product performance - in apparel, kemp has a significant influence on prickle factor - kemp lines can be used for special purposes where its presence can be used as a product feature Color - whiter lines are superior, giving a wider range of end use and enhancing lighter dyed shades 12

20 Lustre - a principle attribute of mohair, being always desirable as a distinguished feature - enhances dye brilliancydamaged by carbonising Vegetable content - preferably under 1% (FNF) for efficient and cost effective worsted and woollen processing - 3% is the maximum which will be processed - higher vegetable content lines usually carbonised, but this is highly undesirable for mohair because of cost and damage to lustre Clean fibre yield - only important in so far as it directly influences the cost of clean scoured fibre Contamination - presence of dark fibres severely limits the end use. There are very heavy penalties for topmakers who allow such contamination. - Fibrous forms of contamination can cause expensive problems if not detected until late in the processing chain. These include urine stain, black wool and man made fibres from wool packs and baling twine. Colour influences the dyeing characteristics. Contamination by non-fibrous objects can also cause major problems for the early stage processor. The prime determinant of any particular fibre requirement, is the desired end use. Typical end uses for various grades are:- Worsted Fine microns - light to medium weight suitings, giving durability with a crisp handle Medium microns - women s fashion wear in knitted and woven fabrics where lustre, color brilliancy, and texture are important - hand knitting yarns brushed and fancy - velours and other pile fabrics Coarser microns - upholstery fabrics hard wearing - usually pile weaves - drapery where lustre and flammability properties are important Woollen Medium microns - women s fashion wear in woven fabrics - blankets and rugs - brushed or raised fabrics Coarser microns - carpets and floor rugs This information has been edited from articles written by Robert Pearce (Acacia Ridge Marketing, Broadford, Victoria) and Scott Seaman (NSW Agriculture) Genes to Suit. 13