Australian Wool Industry Meets To Discuss Forward Risk Management Tool

Growers, agents, brokers and exporters - traditional opposites in the market, saw the meeting as a valuable opportunity to support an initiative that will advance the industry as a whole and not just their individual requirements. The market, which has been operating for a little over seven months has already traded 1,330,000kgs and looks to be rapidly establishing itself as a reliable, accurate and efficient forward risk management tool for both wool buyers and sellers. The fact that, for the first time, both wool buyers and sellers had met together to support an industry product shows how valuable this initiative is to the future of the Australian wool industry.

The wool industry has always been subject to price volatility that has seen forward risk management for both buyers and sellers difficult to track. Buyers are looking to secure forward supply at known prices to manage budgets and delivery, and sellers want to take advantage of beneficial price movements that are not restricted to just the physical auction markets.

The forward wool product on Innovate allows both buyers and sellers to achieve these objectives.

Mr. Peter Coyle, Group manager at Innovate technologies says: “The response we received from wool growers, agents, brokers and exporters has been exceptional. We look forward to continue to work with the industry to build upon the success of the platform and further develop technical initiatives that service the needs of the Australian wool industry”.

Mr. Eric Hutchinson, Marketing Manager from Roberts Limited in Tasmania remarked “The Innovate technology has finally provided direct participants from the different sectors of the wool industry the opportunity to work together in a cohesive manner for the overall benefit of the industry as a whole. We developed initiatives at this meeting that will only enhance the relevance of the Innovate technology, and we – as a group – are comfortable in supporting these initiatives.’

The Innovate Wool Forward Contract is available to all wool producers through their wool brokers. Additionally, wool exporters can place their bids directly onto the screen.

With the extensive distribution by Innovate of the forward prices via daily & weekly reporting as well as smart phone and tablet connectivity, the wool industry has a valuable tool which enables all wool industry participants to clearly identify the forward market prices and make their individual decisions with regard to managing price risk.

Located in Sydney, Australia, Innovate Technologies is owned by the Financial and Energy Exchange. Innovate Technologies is a provider of trading technology.