(By Huo Dongyang, Edited by Zhang Guangkai)
The intertwined sounds of the buzz of shearing machines in South Hemisphere pastures and the hum of machinery in Chinese textile workshops are writing the epitome of global industrial chain cooperation through Sino-Australian wool trade.
Data from China's Ministry of Commerce shows that from 2018 to 2024, the total country-specific tariff quota for Australian wool imports rose from 33,100 tons to 44,300 tons. A report compiled under the leadership of the Australian government states that Chinese market demand accounts for 80% to 85% of Australia's total wool exports. An insider informed the Observer Network that during the Covid-19 period, China’s import volume of Australian wool even exceeded 90% of its total exports.
For more than half a century, the Australian wool industry has walked hand in hand with the Chinese wool industry, building deep friendships. The cooperation between both sides has continuously deepened and expanded, not only limited to the industrial sector but also steadily extending into cultural exchanges. Mr. William Zhang, Consul General of Australia in Shanghai, pointed out that the wool industry is a strong link connecting Sino-Australian trade relations. This precisely summarizes the important position of Sino-Australian wool trade in bilateral economic exchanges.
At present, Sino-Australian cooperation in the wool industry and cultural exchanges are taking new steps. Following last year's visit of Australian farmers to China to understand the current state and market demands of China's wool textile industry, the Chinese future wool industry leader delegation embarked on an inspection tour to Australia in April this year. They delved into Australian wool farms, auction centers, wool monitoring bureaus, and wool museums, comprehensively and multi-dimensionally understanding each link of Australia's wool industry chain.
Mr. Ma Jie, Executive Vice President and General Manager of Woolmark in Greater China and Asia New Markets, stated, "China is not only a major processor of Australian wool but also a large consumer of its retail products." China has significant advantages in wool processing, while Australia holds a dominant position in wool production. This industrial complementarity injects strong momentum into their trade cooperation.
Yang Huan, Technical Director of Hongtian Group engaged in coarse processing, revealed to the Observer Network that the Chinese wool market has seen significant shifts in exports and domestic sales. "Before the pandemic, exports and domestic sales were evenly split, whereas now exports account for 30%, and domestic sales account for 70%." After the pandemic, the overall export inventory of the coarse wool processing industry declined, mainly due to weak demand for formal wear in Europe, compounded by the further suppression of formal wear demand from remote working models. In stark contrast, domestic market demand has shown an expanding trend, with significantly increased demand for knitted casual and sporty wool products.
With the improvement in living standards, consumers are more willing to pay for high-quality, natural wool products. The Chinese wool market is expanding further, and the Chinese wool apparel industry is undergoing a profound transformation from traditional manufacturing to "design + technology + brand" integration.
Consul General Zhang William also mentioned in an interview with the Observer Network that China’s significant position in the global industrial chain is not only due to its powerful processing capabilities as the “world factory,” but also because of its enormous potential in innovation, exquisite craftsmanship, and outstanding design. The Consul General also noted that Australia is also very excellent in fashion design and product innovation, thus forming a highly complementary Sino-Australian wool partnership.
In recent years, the functional wool product market has thrived by targeting different scene-based needs. Besides traditional wool sweaters, wool suits, coats, underwear, loungewear, outdoor sports, and even细分 categories like hats and scarves are all flourishing. Wang Ruizhe, representative of the Chinese Wool Textile Association, mentioned that e-commerce plays an active role in cultivating Chinese consumers' awareness of Merino wool. Wang Ning of Uniqlo's Digital Business Department revealed that Tongxiang, as a wool sweater distribution hub, achieved over one million daily orders through live-streaming e-commerce, successfully driving over 4,000 merchants to transition to online sales.
Meanwhile, there have been noticeable changes in Chinese consumers’ preferences for wool products. All industry insiders unanimously mentioned the potential in the sports and outdoor sectors: domestic wool products are developing towards sportification, casualization, and functionalization.
Wang Enqing, Director of the Research Center and Senior Engineer at Shandong Nanshan Zhishang Technology Co., Ltd., stated, "Wool fabrics are no longer limited to traditional quality and uses but are more in line with current consumers' diverse needs, such as sporty wool products that combine functionality and fashion."
In Xu Ye's view from ICCF Group's Procurement (China) Department, this may stem from changes in consumer behavior. "The younger generation is becoming an important consumer force; they have more diversified requirements for wool products, demanding good quality, comfort, innovative design, and alignment with trends." Xu Ye analyzed for the Observer Network that in the past, wool clothing emphasized warmth and was mostly basic styles. However, with the market shift, consumers increasingly focus on design sense, diversity of styles, and functional expansion.
It is worth noting that manufacturers are continuously increasing their investment in wool product development. Concepts such as waterless dyeing, renewable and eco-friendly materials, and traceability are being integrated into brand promotions. Xu Ye believes that sustainability will become a core competitiveness within the next 3 to 5 years, including environmental protection initiatives, application of renewable/circular materials, responsible supply chain management, and carbon footprint tracking.
Consumer interest in traceable products is growing. For instance, the Ichthyosaurus brand traces its wool back to Australian ranches via QR codes, meeting demands for environmental protection and story-driven consumption; Uniqlo's official Tmall livestream conducts factory traceability broadcasts, involving nearly 20 factories, receiving overwhelming positive feedback and significantly boosting sales.
Wang Ruizhe also pointed out that future applications in home textiles and medical fields could make wool usage more widespread. Aging populations can focus on care-related applications, such as the help of medical wool mattresses in alleviating bedsores for long-term bedridden elderly people. Directions like children's sleep bags can help consumers recognize wool from a young age.
Additionally, Wang Ruizhe believes that consumer recognition is the key space for market growth. There is still room for improvement in brand marketing in China’s high-end cashmere market. Wang Enqing also mentioned that although the product quality of domestic wool processing enterprises matches that of Italy, brand marketing still needs strengthening.
In the context of global industrial chain cooperation, Sino-Australian wool trade not only promotes the economic development of both countries but also makes significant contributions to the prosperity of the global wool industry. From South Hemisphere pastures to North Hemisphere workshops, the close cooperation between China and Australia is writing the epitome of global industrial chain collaboration.
This article is an exclusive article of the Observer Network and cannot be reprinted without permission.
Original source: https://www.toutiao.com/article/7498638063704031756/
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