Clock ticking to save SA wool industry from Chinese import ban | Fin24

If China refuses to lift the ban, SA would have to look for alternative markets like the European Union and Egypt.

• In April this year, China imposed a ban on wool exports from SA following outbreaks of foot-and-mouth disease (FMD) in parts of the country.
• The local wool industry estimates it has so far lost an estimated R734 million in wool exports to China.
• Industry bodies warn that if the government fails to get the ban lifted by the time of the local wool auction next week, it will have devastating consequences for local wool producers.
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Time is running out for government to get a Chinese ban on the import of wool from South Africa lifted before SA’s first wool auction for the 2022/23 season next week.

The value of wool produced in SA is around R5 billion per annum. Usually, between 70% and 80% are exported to China. In April this year, China imposed a ban following outbreaks of foot-and-mouth disease (FMD) in parts of the country.

The SA wool industry estimates it has so far lost an estimated R734 million in wool exports to China.

“We registered all our export facilities to align with what the Chinese require. They accepted [our measures] in 2019, but unfortunately, with new outbreaks, they seem to have concerns that the problem is escalating,” says Leon de Beer, CEO of the National Wool Growers Association of SA (NWGA).

Along with Agri SA, the NWGA has expressed concern about what it regards as an unjustifiable ban by China.

South Africa already has protocols that regulate the storage of wool after shearing for a specified time at required minimum temperatures as stipulated by the World Organisation of Animal Health (WOAH). SA negotiated these measures with Chinese Authorities during an FMD outbreak in 2019.

“The aim was to limit the disruption to trade in circumstances such as the current one,” says De Beer.

“All export facilities in SA have been registered with the Chinese authorities to ensure proper monitoring and accurate certification. No outbreaks have been recorded in recognised wool producing areas nor have any small stock been diagnosed with FMD.”

The industry bodies warn that if the government fails to get the ban lifted by the time of the local wool auction in Gqeberha on 17 August, it will have devastating consequences for SA’s wool producers. It threatens the livelihoods of 35 000 workers as well as 4 500 seasonal sheep shearers and wool handlers.

The Department of Agriculture, Land Reform and Rural Development (DALRRD) agrees that China’s ban is not scientifically justifiable.

“We are still negotiating with the Chinese authorities to have the wool from South Africa cleared in line with the 2019 protocol South Africa has with China,” Reggie Ngcobo, spokesperson of the DALRRD, told Fin24.

Christo van der Rheede, executive director of Agri SA, is especially concerned about the fate of about 40 000 small-scale wool producers. Their wool has an annual value of approximately R300 million, and most go to China.

“These producers and surrounding communities will fall back into poverty should the Chinese market remain closed for wool from SA”, says Van der Rheede.

Furthermore, many commercial wool sheep farmers have only recently emerged from an extended period of drought. If wool exports to China cannot resume due to the ban, these farmers may not survive.

De Beer says if China refuses to lift the ban, SA would have to look for alternative markets like the European Union and Egypt.

“It will not be easy to get a market for 80% of our wool elsewhere. We have to remain hopeful. SA’s wool is of excellent quality, and we do not mistreat our animals.”