Sheep farmers vote against reinstatement of wool levy

New Zealand sheep farmers have rejected reinstating a wool levy to fund industry good activities, according to preliminary results.

The Wool Producers Referendum, which closed on Oct. 10, showed 56.8 percent of wool growers voted against the introduction of a levy while 43.2 percent were in support, according to today's tally of preliminary results. The official results, including some voting envelopes still in transit, will be released at midday tomorrow although it is unlikely the outcome will change, Sandra Faulkner, chair of the Wool Levy Group, said in a statement.

The referendum sought approval from 12,201 sheep farmers for a levy of between 2 and 5 cents a kilogram of greasy or slipe wool, estimated to raise about $4.6 million for the industry. A previous levy was dumped five years ago in a move that forced a restructure of what was then called Meat & Wool New Zealand.

"Growers have elected to operate in a purely commercial environment and there will be some disappointment that this continues to see our $700 million wool industry without an independent, internationally recognised, non-commercial voice," Faulkner said.

Meat & Wool renamed as Beef + Lamb after farmers in 2009 voted against an industry good levy, ending funding for the body's wool marketing, funding and training services. While Merino NZ, Primary Wool Co-op and Wools of New Zealand represent growers beyond the farm gate, around half of farmers aren't affiliated with those groups.

The voting indicated smaller sheep farmers were more in favour of a levy than larger enterprises, with 59.7 percent of larger entities voting against the proposal, according to the statement.

Voter turnout of 47 percent was ahead of the 35 percent usually seen for commodity levy votes, Faulkner said.

A positive vote was required for the referendum to be presented to the Ministry for Primary Industries, enabling the minister to enact the necessary regulations under the Commodities Levies Act 1990.

New Zealand is the world's third largest wool exporter, supplying 45 percent of the world's carpet wool.

(BusinessDesk)