Chinese Wool Delegation Visits Australia, New Zealand for Supply Chain Talks

Summary

An 18-member delegation organised by the China Wool Textile Association and the CCPIT Textile Sub-council began an exchange visit to Australia and New Zealand on 26 October. Led by Liu Lihua, vice-chairman of the CCPIT Textile Sub-council, and Liu Dan, vice-chairman of the China Wool Textile Association, the delegation represents various segments of the textile and apparel supply chain. The visit aims to help Chinese textile and apparel companies deepen their international footprint, expand diversified cooperation, and integrate their participation in the global value chain from raw materials to products, from production capacity to marketing, and from brands to capital.

On 26 October, the delegation visited Australian Wool Innovation (AWI), the Australian Fashion Council (AFC) and the Australian Wool Exchange (AWEX), engaging in multi-dimensional discussions with the three organisations and achieving significant outcomes. In the following days, the delegation will continue its visits in Australia before travelling to New Zealand for exchanges.

Commentary

The joint delegation from the China Wool Textile Association and the CCPIT Textile Sub-council is visiting Australia and New Zealand to research the wool supply chain, sending a clear signal to New Zealand SMEs. New Zealand is one of the world's largest exporters of coarse wool, accounting for about 9 percent of global production, but wool prices have been depressed in recent years, prompting farmers to switch to beef cattle and causing supply to contract. China is the largest buyer of New Zealand wool, taking more than 40 percent of exports, mainly for carpets and interior textiles.

After visiting Australian Wool Innovation (AWI) and the Australian Wool Exchange (AWEX), the delegation will move on to New Zealand, where it is expected to inspect farms, the auction system and processing operations, and discuss cooperation on stable supply and quality grading. For NZ SMEs, the short-term focus should be on Chinese buyers' purchasing intentions for specific wool micron ranges, especially premium opportunities for crossbred and carpet wool; in the longer term, they need to assess Chinese companies' interest in investing in South Island scouring and warehousing, which could change existing export channels. On the other hand, the Australian wool industry is promoting traceability and sustainability certification.

If New Zealand follows suit, small and medium-sized farms will face higher compliance costs, but could also gain access to high-end Chinese brand supply chains. China's textile industry accounts for more than half of global production capacity, but its dependence on imported wool exceeds 70 percent, making Australia and New Zealand key to its diversification strategy. If the visit leads to long-term purchasing agreements or technical cooperation, it would help stabilise New Zealand's wool export prices, but SMEs should watch for a trend of Chinese buyers bypassing local intermediaries to deal directly with farms.

Keywords: China Wool Textile Association, CCPIT Textile Sub-council, Australia, New Zealand, wool, textile and apparel, supply chain

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Source: China Textile Economic Information Network