Unravelling China's wool enigma

To Australian eyes it's a perplexing contradiction of high-technology processing mills and modern fashion-conscious consumers mixed with woolgrowing and harvesting techniques that don't appear to have changed in 100 years.

Australians touring China on a recent Elders industry tour found themselves taking on the task showing woolgrowers in Inner Mongolia how to shear, skirt and sort, Merino fleeces.

Mechanical shearing gear is also rare in China.

Up to 90pc of Chinese farms in the nation's northern and western sheep production regions use blades or scissor-type shears and shear on bare ground using a slow and complicated fleece removal technique that baffled the Australians.

Fleece wool, stains, bellies and locks are all bundled into the same sacks or bales for sale.

The raw wool is invariably matted with mud, grass seeds, sticks and stains, and clips are likely to include a lot more second cuts than wool from Australia because better skilled full-time shearers tend to only work regularly with big State-owned farms.

Sub-zero temperatures, snow and high winds across northern China also add to production challenges.

Sand-laden winds blasting across the landscape penetrate deep into sheep's coats, adding to the big scouring challenge for processors sourcing wool locally or from neighbouring Russia.

The gritty dust typically reduces clean fleece yields from many Chinese farms to as low as 40 per cent, or less than two thirds of Australian scoured wool yields.

China has the world's biggest sheep flock estimated at about 140 million head and producing about 363,000 tonnes of wool, compared with Australia's 75m sheep producing about 330,000t.

In northern China's windswept Inner Mongolia where snow covers the ground for up to six months at depths of 30 to 40 centimetres the Elders delegation visited an agricultural research station in the Aohan region where Australian Merino genetics have helped underpin local finewool growing efforts.

However, despite importing Merino and Poll Merino rams from Australia in the past decade or more, woolgrowing is becoming a secondary priority for many farmers as they lean towards marketing their livestock for meat production.

As the Elders group discovered at a meat industry exhibition in Beijing, Inner Mongolian processors are modern and working hard to build markets and reputations alongside a tide of imports catering for China's fast-growing taste for red meat protein.

Click on this image to see more photos of the Elders wool tour in our online gallery.

In the 1950s Inner Mongolia's eastern grasslands led China's early efforts to breed Merino-style finewool sheep, based on imports from Saxony in East Germany crossed with flocks on State-owned farms.

Australian Merino genetics began arriving after 1972 and by the 1980s were making a significant addition to the Chinese gene pool, strongly encouraged by the central government's agriculture and textile ministries as wool market values climbed.

But a dramatic cooling in the wool market after 1990 and China's hunger for meat and grain has constrained efforts to improve the nation's wool quality since the late '90s.

While State-owned farms have traditionally produced much of China's better wool, the vast majority of Chinese sheep are now owned by private farming groups or families free to make their own market choices.

The incentive to switch to grain cropping, horticulture, or focus on dual purpose or meat production characteristics in their flocks has been strong said farm leaders and researchers meeting the delegation of 47 Australians.

Privately-held flocks in the Aohan region typically number 60 to 80 head or up to 100.

Merino sheep in the Yang Chan district visited by the delegation were typically housed in winter (October to April) to ensure their survival, but long months on earthen floors and in yards also added to the dirt and stains in their wool.

In the warmer months they are shepherded on unfenced, fragile rangelands which stretch into desert nearby.

South western NSW wool and grain producer Ron Hoare from Balranald, on his third visit to China, was amazed by the rapid pace of change and modernisation across the country in the past decade, but also the constant contradictions.

"They've done really extraordinary things with their road and transport systems, including building the world's fastest trains, but their woolgrowing ideas are still pretty basic and we saw grain drying in the sun on the edge of the highway," said Mr Hoare whose family's 40,000-hectare operation, including 14,000 sheep, is based on "Riverleigh" at Koraleigh.

"I think China's probably really starting to see its sheep for meat production rather than fibre."

Mr Hoare, whose partnership includes his wife Joan and sons Jim and Bernard, said one of the most obvious changes and indicators of Chinese determination he noted was the "greening" of the world's most industrialised and polluted nation.

"Ten years ago you hardly ever saw any trees, now the roadsides in are thick with greenery I suppose it helps improve the air quality a bit."

Andrew Marshall travelled to China as a guest of Elders.