The remarkable story of the 1960s "white gold" rush in North West NSW which grew into today's $4 billion national cotton crop is underpinned by the equally extraordinary birth of the ginning and marketing business which made it all possible.
In October Namoi Cotton marks the 60th anniversary of a meeting where a tiny group of Wee Waa growers hastily founded a ginning venture to process the crop they had just planted.
They barely had the minimum seven members required to register their co-operative society - and they had no money to build anything.
Defying those odds, equipment for a two stand cotton gin was imported and by April 1963 began processing 1413 bales on the outskirts of town.
Namoi's ginning capacity was doubled two years later, and a second site opened at nearby Merah North in 1966, followed by three more in the next three years.
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By the early 1970s, despite widespread floods, and exploding insect and weed problems to test cotton growers, Namoi Cotton was ginning almost 100,000 bales a year and had sold its first 16,000 bales to China.
The area planted to cotton by co-op members around Wee Waa, Narrabri and further afield had ballooned to more than 17,000 hectares.
Six decades later the farmer-built business, now a listed public company, remains a dominant player in the still-burgeoning sector.
It has nine gins spread from southern Queensland to southern NSW and capacity to handle 1.5 million bales, plus a network of grain and cottonseed storage and packing sites.
Namoi Cotton is also firming up a joint venture to operate a three stand gin for the emerging Western Australian industry at Kununurra by 2025 and is exploring options for a similar venture at Julia Creek or Georgetown with new era North Queensland growers
"We're very aware of our long relationship with growers, even though the ownership structure has changed from its historic co-op origins," said chief executive officer, John Stevenson.
"We don't see ourself as a stand alone corporate primarily focused on our own business profits.
"Our success depends on those close relationships, and growers are depending on us to help them get deliver the best possible lint to the market."
On the rebound
After climbing back from a crippling drought-depleted ginning throughput of just 124,000 bales in the 2020 season, Namoi handled almost 500,000 bales last financial year and is anticipating up to 1.2m from the recent harvest, almost half of which will also be sold by its trading joint venture partner, Louis Dreyfus Commodities.
Similar gin volumes are likely from an above average planting area in 2023 thanks to full irrigation water storage levels in the Murray Darling Basin.
It's a far cry from the first Wee Waa cotton crops planted by Namoi's founding chairman, Paul Kahl, and fellow pioneer from California, Frank Hadley, who together picked less than 30 hectares from their first patchy 80ha attempt in the summer of 1961-62.
They then trucked their 42 bale harvest to Brisbane for ginning, which required 10 1200-kilometre round trips over mostly gravel roads.
When evaluating their first cotton year in Australia the two quickly determined they needed to source better quality planting seed from the US, and build a local gin.
Groundbreaking deal
Strapped for cash, Mr Kahl lobbied Labor Premier, Jack Renshaw, to support Namoi Cotton with a loan and help convince the ANZ bank to do the same.
The deal involved co-op members paying a third of the funds, but as Mr Kahl's son James recalled, his father inflated the gin's estimated construction costs during his loan discussions, securing enough money from the two lenders to cover the full cost of the project without Namoi having to pay its share.
The gin was built for about $80,000 - not $120,000 - and officially opened by Jack Renshaw, who coincidentally, returned 16 years later to repeat the ceremony at Moree, after Wee Waa's ginning gear was relocated to the Gwydir Valley in 1979.
Namoi's 60-year journey has featured plenty of impressive growth spurts, but it hasn't been easy either, conceded Mr Stevenson.
He took over as CEO last year tasked with continuing a balance sheet restructure after multiple years of drought and a corporate struggle to keep debt in check.
Years of stubborn debt concerns and exposure to volatile markets recently convinced Namoi to retreat from the risky business of marketing growers' crops, focusing instead on beefing up its ginning capacity and quality and optimising value-adding opportunities.
Last year joint venture marketing partner since 2013, Louis Dreyfus, took control of lint marketing and trading within the Namoi Cotton Marketing Alliance.
"I guess running a business like Namoi Cotton is a bit like farming - you have to evolve with the times and business pressures," said Queensland grower and second generation ginning and marketing customer, Craig Saunders.
Continuity of support
Mr Saunders, who grows 800ha annually at St George, valued the continuity of support and good relationship his family had enjoyed with the company since 1981 and was not fazed by its 2017 ASX listing or recent cotton trading restructures.
"I think the co-op ethos developed a supportive and fair culture across the business which I certainly appreciate, but to stay relevant you can't always keep doing things the same way just for the fun of it," he said.
"So long as the board has a good level of grower representation and the leadership understands growers challenges and needs I'm happy to support them - and offer my congratulations on the anniversary."
Wee Waa grower, Jeff Hamblin, Belah, also appreciated the "hands on assistance" from Namoi's grower support team, including marketing help.
"We shop around for the best price, but I'd say we end up marketing at least half our cotton with Namoi and 90 per cent of the time it's the right decision," he said.
'Done us proud'
Aside from appreciating the short freight distance from his farm to the Merah North gin, Mr Hamblin was "quite proud" of what Namoi Cotton had achieved for the local community and the cotton industry.
"Those early days of the co-op really put our little town on the map, and there's still quite a strong operation on the ground here, even though the headquarters is now in Toowoomba."
To help cope with this year's doubling in ginning volumes, Namoi Cotton has found technical help from Zimbabwe, with 13 assistant level ginners arriving on temporary work visas as part of a three or four year program.
"They have great equipment maintenance skills, they're typically younger than many of our local ginners and they are mobile, so they've added some useful characteristics to our workforce," Mr Stevenson said.
Flexible overseas recruits would also be helpful in establishing the Kimberly Cotton Company gin.
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Andrew Marshall
Andrew Marshall is the group agribusiness writer for ACM's state agricultural weeklies and websites. He is a former editor at The Land and has worked in various Rural Press group roles in Canberra, North Richmond (NSW) and Toowoomba (Qld).
Andrew Marshall is the group agribusiness writer for ACM's state agricultural weeklies and websites. He is a former editor at The Land and has worked in various Rural Press group roles in Canberra, North Richmond (NSW) and Toowoomba (Qld).
