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Feds Southland - Wool Board Questionaire Results

Federated Farmers Southland

QUESTIONNAIRE RESULTS

This survey was initiated due to the growing dissatisfaction among wool growers with the price of wool and as Federated Farmers Wool Spokesperson, Ian Smith tried to encourage the board to get these questionaires filled out at the recent Wool Board area meetings. Many comments later from members led us to believe that people were very dissatisfied with the way the Board had run the meetings and had worded their questionnaire. Therefore the Meat and Wool Section picked up the initiative to go out in the regions to our members and find if the critisicm of the Board’s meetings and results was justified. 10 area meetings were conducted from 19 July to 19 August throughout Southland. With the response from this survey and from the area meetings, Federated Farmers Southland has hoped to obtain the feeling from farmers on how best to deal with this price low.

186 woolgrowers in Southland completed this survey.

At the area meetings, Ian Smith presented brief figures about board spending which was followed by a discussion before the questionnaires were distributed among the attendants. The majority of surveys were returned at these area meetings. Ian Smith, Federated Farmers Wool Spokesperson, attended all area meetings and Doug Fraser, Wool Board Director was also in attendance at eight of the nine meetings. The survey was also distributed with the Federated Farmers Southland newsletter to approximately 1400 woolgrowers in Southland.

Doug Fraser was in attandance at the meeting to listen, and to clarify any comments of the attendants.

Ian Smith, Federated Farmers Wool Spokesperson has been involved in the Meat and Wool Section of Federated Farmers since 1984. He has represented Southland at many national Federation meetings. He was a member of the Meat and Wool Board’s electoral committee for the last three years of its existance. He was Southland Meat and Wool Section Chairman for 2½ years from November 1995. He has been elected at area meetings as a Wool Area Delegate for most of the Wool Board Annual Meetings since the demise of the electoral committee and is currently an area representative to the Wool Board. In 1999 Ian was asked to come back and fill the Wool spokesperson position for the Meat & Wool section of Federated Farmers Southland.

For further information or comments, please contact Ian Smith, phone (03) 246 9835, or the Federated Farmers office on (03) 218 2869.

(Bulleted text are all additional comments from the survey participants).


1. Do you support the New Zealand Wool Board collecting levies from you, the woolgrower?

Yes 66.6%
 Not necessarily the Wool Board
 Unhappy with Wool Boards performance

No 28.4%
 With the exemption of WRONZ
 On a limited basis
 I do not support the New Zealand Wool Board

Unanswered 5.37%

2. What levy level would you support?

0% - 12.9%
1-1.5 - 17.7%
2-3% - 51%
 Don’t mind which as long as their efforts give me a return
4-5% - 10.75%
 Should vary according to what you receive for your wool
 If we were getting another $2/kg

Unanswered - 7.5%
 It is inappropriate to keep paying Wool board levies under the present board structure where there is no commercial accountability
 Not sure about levy level but no greater than 5%
 WRONZ only
 As little as necessary
 Depends on level of activities board is expected to perform.

3. What micron sector does your wool clip fit into?

25-31 micron - 15%
31-32 micron - .5%
32 micron + - 95.6%
unanswered - .5%

Some of those in the 32 micron + bracket also fall into the 25-31 micron bracket.

4. Would you be in favour of each micron group setting their own levy?

Yes 58.6%
 At 1%
 Only if marketing = %

No 32.7%

Unsure/unanswered 9.1%
 Would still need some funding to go to central board to fund micron neutral projects

5. What do you think should be done with the $112 million of reserves?

a) Retained as reserves with income going towards funding Research and Development - 54.3%
 Loan money for suitable for suitable marketing initiatives
 Needs to be used on R & D but not with it as a fibre but uses like the plasma film
 Put towards Wool Corporation style selling
 Set some aside for setting up Wool Corporation
 By reducing levy to 3%
 50% to growers, 50% to R&D
 Make available on commercial basis

b) Be used by the Board as and where they think needed - 8.6%
 To fund entrepreneurial schemes.
 Wool Corporation

c) Repaid to present levy payers - 22%
Paid back on a back to back basis forming a new marketing company.
The board should be downsized, and live on income
Worked out on kg on wool sold and paid out next July.

d) Other suggestions - 11.2%
 $50 million reserve, repay the rest
 Retain reserves & repay to present levy payers
 Retain reserves & have reserves used by the board as and when needed
 Forward to another group who can sell wool
 Wool acquisition
 Let income accumulate to reduce the levy
 Fund Wool Corporation concept
 Wool Corporation take them over
 Repaid to present levy payers based on last 3-4 year average paid ie. some have not sold wool this year.
 Need to get Wool Corporation underway
 Use income for integrated marketing and research programme. Status quo.
 Divide the surplus between R & D and the other half be used by the board as and where they think needed and get to it! Use it to create better wool prices
 Retain as reserves & repay to present levy payers. If the reserve was surplus to requirements some should be repaid.
 Axe
 Repay half to present levy payers other half use for Research & Development
 Use for a new marketing structure
 Paid out as shares (to present to growers) to fund future wool company.
 Give it to Wool Corporation
 Retain half as reserves, and repay half to the present levy payers.
 Split into shares to set up Wool Corporation
 I am annoyed that they have wasted about $300 million of reserves and don’t trust them.
 Go to funding Wool Corporation
 Given to Wool Corporation
 Retain $25 million for Research & Development. Repay balance to levy payers.
 Income going towards funding marketing.

Unanswered - 3.76%

6. The areas of operation for which you would be prepared to pay a levy.

On farm R & D - 60.2%
WRONZ R & D - 72.5%
Promotion & Marketing - 40.3% (there were comments made by some that while there still needs to be promotion & marketing, it should be at a much reduced level).

Combinations:

On farm R & D & WRONZ R & D - 29.5%
 Develop WRONZ R & D into practical and marketable products.
 Should also be making political representations

On farm R & D, WRONZ & Promotion and Marketing - 22%
 On farm R &D (17%), WRONZ ( 20%) and Promotion and Marketing (50%)
 More communication with growers especially with research results.
 More to R & D with a floating fund (see reserves) as required. Reduce administration to 10%.
 Order of preference as above.
 Promotion and marketing in partnership with industry.
 Promotion and marketing needs to be reduced and retailers pay more. Administration should be more than 5% but we don’t need full page advertisements to tell us about meetings.
 Promotion and marketing should be reduced
 Promotion and marketing reduced
 Reduced Promotion & Marketing, reduce administration.
 All three are important to achieve a top quality product to promote and market.
 More promotion, less marketing, promotion in schools and sports.
 Promotion and marketing needs tighter constraints. Administration is out of control at 13%.
 Promotion & Marketing is a difficult area given that the Board are not involved in the selling of the wool. It is a very important function but where are the exporters in this area? No other company/product/industry reaps benefit of making sales with no marketing expenses but has another body spending millions on their behalf to promote their product in their markets to their customers. Exporters should be coming to the party with marketing and promotion costs.
WRONZ only - 16.1%
 And the promotion of WRONZ products. WRONZ needs to be 50% farmer owned and outside ventures taken up and perhaps profiteered from. Not an incorporated society.
 Ownership of large manufacturing and marketing company overseas to get more of the huge returns from the finished product - selling.
 Does research prove that 62% (the proportion of funds dedicated to P&M) of $ in Promotion and marketing is effective and cost efficient?
 Need to put more money to WRONZ

WRONZ R & D and Promotion & Marketing - 8.6%
 Especially marketing
 Promotion & Marketing diminish as more effective systems take place.
 Even split of funds between the two.
 WRONZ R & D (62%), Promotion & Marketing (8%)

Promotion and Marketing only - 7.5%

On farm R & D only - 5.9%

On farm R & D & Promotion and Marketing - 3.2%
 Promotion and marketing at a much reduced level

Other suggestions
 20% for research the rest for Wool Corporation
 Wool Corporation
 Research and Support for Wool Corporation
 Administration is too high
 Administration too high. Reduce exceptionally high salaries.
 Administration 10%. Joint venture promotion 15%.
 Promotion and marketing should be at a much lower level.
 Promotion and marketing should have a lower level of input.
 Promotion appears ineffective (eg. the present wool prices).
 Promotion and marketing at a reduced level - 30%
 The manufacturers and retailers should pay promotion and marketing
 We believe that the persons that manufacture wool should do the promotion & marketing
 I want ownership of any part mentioned before I will commit to anything
 Disband the Wool Board - they have had their chance
 I’d like to see the rate of return on the above areas before deciding.
 $115 million should be enough for R & D & Promotion for 20 years.
 However we must look at option to retain our overseas staff and integrate them into commercial farmer driven enterprises
 Return to levy payers an ownership shareholding. The current situation is unworkable. On farm R & D needs to be re-assessed.
 On farm R & D & WRONZ funding should come from industry reserve interest. There should be a 2% levy only for promotion/joint marketing focused to micron group.

Unanswered - 6.4%

7. Do you see the benefit of one Board to cover both Meat and Wool?

Yes - 59.1%
 Reduced administration costs (18 people indicated that it would be beneficial because of this).
 Hopefully this would keep overheads to a minimum. Both boards appear to involve themselves in areas that they should not be in ie. promotion and marketing. I would like to see a Dairy Board system in place for wool only.
 As long as it was run by ¼ of present staff of both boards ie. less chiefs more indians.
 As long as it cut down the cost of high paid staff
 Savings in wages with less directors.
 Cut down overheads
 Review R & D, set goals eg. 5 year plan for improving sheep profitability
 One board with separate divisions for Meat and Wool
 As a producer organisation but not as a marketing organisation
 R & D projects compete for funds
 Get both working together to achieve better results, eg. Alliance major wool seller as well.
 The proportion of money spent on each commodity should be related to the relative proportion of income received by a farmer taken from Agriculture New Zealand monitor farm for that micron class of farm.
 It is inevitable, two main responsibilities - 1) political 2) on farm R & D
 Especially in on farm research
 Perhaps in marketing & promotion
 Although they are two different products, they are from the same animal.
 With an equal level of input (levy).
 For research & technology transfer.
 If they could work together for the benefit of the producer
 Each micron group should promote their own section with their share of levy.
 Both boards have taken and spent huge amounts with very little to show for it. One board should be more efficient.
 Haven’t we been here before- what were the reasons it didn’t work last time?
 Yes provided that both boards have members that are only elected by the Producer.

No - 34.4%
 Each product must remain separate. Because one product is perishable and the other is non perishable. The wool board should be disbanded to set up Wool Corporation.
 We think that the people manufacturing for meat or wool should do their own marketing.
 Food is different to fibre. I would rather let each industry decide it’s own fate.
 Because it would be less specific and focused on the product.
 Two totally different products
 They are not very complimentary - wool is a cost to the meat industry.
 They’re bad enough now on their own - together it would be worse.
 I see no need for either in their present form. If we have private enterprise involved they would realise that to maintain supply they have to pay realistic returns. This is not happening at present.
 There is a trend in this direction but it should not be pushed to hard. The industry is in a transition phase. Sheep are the common link but food (meat) and fibre (wool) are poles apart.
 Not in the field of marketing.
 If the Wool Board cannot achieve better results they must question their reason to exist.
 Maybe OK - now we have the business units setup.
 Meat board has a worse record than wool - putting 2 idiots together doesn’t raise the IQ of either.
 New Zealand farmers need to attain more realistic prices for their wool - the profit margin is virtually nil these days - create greater markets for wool!! That’s why we pay the levies.
 One board for both would probably end up going into sub-committees for either Meat or Wool.
 Meat Board serves beef farmers and dairy farmers as well as wool growers.
 Wool Board is making a big enough mess by themselves.
Unanswered - 8%
 Wipe both boards
 Not sure - only that a large saving in standard charges could be achieved
 I think there must be a lot of common ground. Maybe an in depth investigation into overlapping areas could be useful.
 Closer co-operation initially with perhaps join ventures. Monitor success of these.


8a) Do you support the status quo in wool selling systems?

Yes - 20.4%
 But with electronic trading and direct contracts encouraged.
 Half hearted
 Quite like auction system as you can set reserves
 Until some other system is available


No - 56.9%
 Take too much from the farmer
 Not satisfied with Wool Board selling system but unsure if Wool Corp or Cluster groups would be an improvement.

Unanswered - 22.5%


We have amalgamated 8b & 8c because we could not draw any real conclusions from these questions as a large number of participants ticked ‘yes’ to both questions.

8b) Are you an active supporter of the Wool Corporation (Phil Verry) concept? (Federated Farmers has been advised and accepts that this question has been inaccurately worded - it should read ‘Are you a supporter of the Wool Corporation concept’. Therefore, this is an understated measure of Wool Corporation support from farmers - it can be assumed that a percentage of those that answered ‘no’, would have answered ‘yes’ if the question had been worded differently.)

8c) Do you support a Co-operative Grower Cluster Group?

Yes - 43.8%

No - 32.2%

Unanswered - 23.6%
9. Did you attend a Wools of New Zealand meeting last month?

Yes - 37.6%
 We cannot continue to sell through the present system. We must set up new selling system to increase returns to farmers or sheep farmers as we know them today will not exist.
 There seemed to be a fait accompli about the 3% per year price trend down. I don’t think we should accept that because the trend for wool as a commodity is ---. We have a natural renewable organic resource.
 It was a stacked questionnaire.
 Disgusted the Wool Board did not consult growers over the new Woolnet selling system. We cannot support a Board that sees the value of our wool not improving.
 Wool Board director saying it is just a fact that wool will fall 2% a year.
 Very good.
 Reasonably strong support for WRONZ unlike some meeting reports. Informative on R & D if you were positive thinking.
 Questionnaire stacked towards moves being made by Wools of New Zealand.
 Winton where my perception of that meeting does not reflect the figures presented.
 Fairly informative. Question time too short because they had another meeting.
 Bruce Munro was not listening to the feeling of the meeting.
 Board has very little support.
 I found the Board unexciting, flat and totally unattached with the modern marketing of the world.
 I thought the Wool Board to be very arrogant. Especially the CEO.
 The New Zealand Wool Board is going to stumble along as it always has.
 Impressed with the Wool board presentation.
 I felt it was poorly represented by growers. The timing of the Tuatapere meeting isn’t a valid excuse for the poor attendance where approximately 20% of their income was represented.
 The meeting was informative and gave me an insight to problems which exist. I believe the Wool Board to be on the right track.
 Wool Board should get out of wool marketing.
 Bruce Munro speaks too much and a lot of ½ truths came out. (ie. double scouring not done through farmers or Wool board - scourers initiative). Fragmentation of industry promoted by Wools of New Zealand (grower clusters) in totally the wrong direction.
 Without direct farmer ownership there is no future for the boards. How many agencies down the chain must laugh how we partially fund their infrastructure.
 Small but positive.
 Waste of time
 Board members were too busy patting themselves on the back.
 Don’t know enough about cluster groups at this stage.
 So negative. Don’t compare wool to other fibres. If the Wool Board does not believe it has a superior product, they should resign.
 Wool Board is past it’s use by date.
 Surprised at the response this year when wool has been poor for ages.
 Wool Board didn’t listen.
 Far too long.
 Supported the board at the time but have since decided against.
 The Board has done poor job of promotion and marketing. It has not involved itself enough in ownership of manufacturing and marketing of finished product.
 I don’t trust them to do what is right.
 Bruce Munro thinks(?) that farmers will produce wool no matter what the price is. (He may be mistaken).
 Ongoing research seems necessary. Hopefully eventually fully funded y income from the reserves, and income created by the previous research projects.
 If this did not bring home to Mr Munro that the board performance was poor nothing will.
 Chairman dominated the proceedings, often straying from focus on wool. More women should have involvement in decision making (are there any at present?). Now a large % of women are levy payers as well as making the buying decisions.
 Mr Munro was wanting total control of the meeting (defensive).
 Regarding the new industry review - I’m not convinced - a bit skeptical. Generally some party will not be happy with the people reviewing and/or the review. Would it be binding? Nervous about another group saying they represent growers - they may have independent agenda/allegiances. What’s wrong with a eg. FF/WB perhaps OK if we all able to see/contribute to each stage. Given most farmers will not contribute - important that organising group don’t have biases already to push review in predetermined direction.
 They didn’t listen to what the farmers were saying.
 WRONZ need looking after. We need them to find ways to use wool. The meeting showed the Wool board are just living in hope.

No - 62.4%
 Not enough time - too busy trying to make enough money to pay Wool Board levy!
 Meeting times.
 Attendance at similar meetings over the past 40 years have shown that no effective decisions have ever emerged from such meetings. The Board has always followed it’s own agenda, regardless of grower opinions. They have consistently opposed any marketing reform eg. Lanette Report, Batelle Report etc etc, preferring always to stay with the status quo. So far as promotion is concerned, are we sensible in promoting a product which we don’t own? Meat is in the same category as far as promotion by the Meat Board using grower funds. When the meat is supplied to the works, the meat becomes the property of the meat company, even if they have not paid for it. (eg. Fortex). They still owe us $12,500 for meat supplied but not paid for.
 Local meeting was a fizzer.
 Too much talking from chairman and not enough listening. Smooth PR job on farmers for status quo.
 Other commitment at that time.
 At least it is a start.
 Have gone to their meetings for the last 35 years and it didn’t change a thing - they don’t listen.
 I saw them as a waste of time going.
 Research and Development is well worth persevering with.
 Did not know the closest meeting was n until it was too late to go.
 Votes of no confidence should have been taken at all meetings.
 The Wool Corporation concept seems to have the most potential to lift profitability but I am not convinced if it can be implemented under the budget suggested by Mr Verry.
 Need an independent survey/audit of growers.
 Clean out Wool Board - dead wood


...Other comments

 Wools of New Zealand set up Woolnet to stop Wool Corporation. We the growers had no say on Woolnet. Dispand the Wool Board
 Levies may appear to be less on meat but our processing companies do a lot of marketing and promotion and that comes out before we receive our net proceeds.
 The world’s affluent markets are screaming out for clean, green and organic. We have an extra special fibre.


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