By Hugh de Lacy (snr)

The final decade of the twentieth century began disastrously for the New Zealand wool industry. The fall of the Berlin Wall in 1989 had precipitated a collapse of the Eastern European economies which had been steady buyers of New Zealand wool. Combined with a slump in Japan, a war in the Arabian Gulf and continued uncertainty in the Chinese market after Tienanmen, wool prices crashed by a third in 1990-91.

On its own, this development might have been survivable for the Wool Board’s system of market intervention and supplementation, but the Australians had been rapidly increasing their national finewool flock, especially in Western Australia, while kidding themselves that this would not have an inevitable effect on demand.

By 1990 the Australians had cranked up their rigid minimum price scheme to 870 cents a kilogram. This compared to New Zealand’s estimate of its floor price being about 525 cents, allowing for the value difference between Australia’s fine and New Zealand’s predominantly coarse wools. But the Australian system could never support so high a minimum price in the face of such a huge drop in demand. In early 1991 the system collapsed and the Australians were forced to abandon it. New Zealand had no choice but to do the same, leaving farmers with no market support for the first time in half a century.

Before the collapse of price support, the Wool Board stockpile had grown to 655,000 bales. Afterwards the board faced a massive down-sizing. The only part of its activities it didn’t cut back was its wool services division, which was by then training 1800 shearers and a thousand woolhandlers and classers a year. The service’s founder, Godfrey Bowen, died in early 1994 and a memorial award in his name was launched for the country’s highest-scoring competition shearer. The inaugural winner was the man destined to become the greatest shearer ever, David Fagan.

A series of sweeping changes to the structure of the New Zealand wool industry followed the collapse of the floor price scheme. Merino New Zealand was formed and by 1995 had effectively split from the rest of the industry to pursue its own destiny at the top end of the apparel market. About the same time the Wool Board finally pulled out of the International Wool Secretariat, and was researching, promoting and marketing its crossbred clip under the Wools of New Zealand and Wool Interiors brands. This reflected a change in direction from supporting wool prices to bringing farmers and wool-users closer together under Wools of New Zealand and its Fernmark brand. Quality control in the shearing shed became more important, and many shearing contractors participated in the Fernmark Quality Programme through which they could gain 9000 series quality control certification from the International Standards Organisation.

In mid-decade the market recovered substantially, but just when things were looking promising the 1997 Asian economic crisis thumped the industry, setting the recovery back at least two years. The decade ended on a positive note, however, with finewool jumping 50% in value in the 1999-2000 season (after a 30% drop the previous year) and average crossbred prices rising steadily for three years in a row.

Not that the wider picture was looking all that buoyant. By the year 2000 total sheep numbers were down to 42 million, of which nearly a half were Romneys. Perendale numbers had slumped to 2.5 million (6%) though Coopworth numbers were holding up at seven million (16.5%). Corriedales, at 3.7 million (9%), were back to their highest levels since the late 1970s, and mixed breeds had emerged as a major component of the national flock at 3.3 million (8%). Merino numbers, at 2.5 million (6%), were at the same level as the end of the previous decade.

While sheep numbers were down, so were the number of sheep farms. In 2000 they dipped under the 16,000 mark compared to the 21,000 to 23,000 total they had maintained throughout the 1970s and 1980s. Some of this was due to amalgamation into bigger units, but it also reflected the conversion of sheep farms to dairying, especially in the South Island – a trend that would accelerate in the following decade.

Shearing expenses as a proportion of the wool cheque were on the rise, reaching 26% at the turn of the millennium.

Overall the decade reflected the continuing coarsening of the New Zealand wool clip and the change in farming focus from wool to meat. Farmers had over the decades generally worked on a variable 40:60 ratio of wool production to meat production, but as wool prices and demand continued to slide, the accent went heavily onto the production of lambs for meat.

A major change in woolshed practice was introduced in the early 1990s with the Australian-style capless pack, held closed by steel hooks, replacing the system of shearing gangs’ pressers sewing caps on bales. Various modifications of the predominantly hand-cranked wooden wool-presses came on the market, but the change prompted farmers to move in large numbers to no-tramp steel electric presses.

As the new millennium rolled round, shearer numbers were falling but their individual outputs were rising. The likes of David Fagan and the Forde brothers had elevated New Zealand shearers to the role of professional athletes, and their workplace had expanded from Australasia to world-wide. The Wool Board’s shearing and woolhandling training scheme had matured into a fully-fledged industry training organisation. Even the old Workers Union, descended from the Australasian entity that had pioneered the union movement in both countries, had amalgamated with the Labourers’ Union to become the three autonomous Amalgamated Workers Unions (Northern, Central and Southern).

The overall outlook for wool was still a state of decline, however. From 20% of world fibre production at around five million tonnes in 1900 – when the other 80% was all cotton – wool had shrunk to 2.5% of the 55 million tonne global fibre industry by the end of the century. Cotton’s share had fallen to 35.5% as first cellulosic (5%), from the 1930s onward, and then synthetic fibres (57%) after World War Two assumed their dominance.