Blowflies are continuing to develop resistance to chemicals used for treating sheep flystrike.
Australian Wool Innovation's general manager for research, Jane Littlejohn, said the rise in resistance was worrying.
She told AWI's annual general meeting the company's sheep health and welfare program was making groundbreaking investments in flystrike research including the search for a blowfly vaccine.
AWI CEO, Stuart McCullough, said the grower-owned marketing and research company didn't yet have a solution to flystrike.
He said flystrike was an extremely complex issue which went way beyond things like breech wrinkle, dags and genetics.
"That's why it's so challenging," he said.
AWI was working on interesting research including a blowfly vaccine, genetic modification of blowflies using CRISPR technology and a potential new chemical solution.
The lack of an alternative solution to flystrike has maintained reliance by large parts of the industry on surgical mulesing despite noisy pushback from some consumers, retailers and animal activists.
Mr McCullough said in the absence of a suitable, cost-effective and equally good alternative to mulesing, woolgrowers would opt to keep their sheep alive.
'We have a number of publications on our website for managing a flock with or without mulesing, we are going to continue to hunt for a solution and potentially something that nullifies the blowfly.
"We are in the job of research and development, not necessarily telling woolgrowers what to do," Mr McCullough said.
AWI chairman, Colette Garnsey, said the company had invested more $30 million into flystrike research since 2005.
"It's a clear priority area for growers and the company. The board is anxious to see more projects in this area."
Dr Littlejohn said AWI had been enjoying success in another area of extreme concern for growers - predation by wild dogs.
She said AWI-funded predation programs and initiatives were not only reducing dog numbers and saving sheep but also improving the wellbeing of producers.
She said surveys showed 147,000 sheep had been saved during the past six years including 39,000 sheep last year.
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