Mark Scott is the WoolQ & Traceability Project Manager for Australian Wool Innovation. In the interview below, he explains how tracing Merino wool links customers to producers and allows sheep farmers with long and rich histories to tell their story to the market. Elements of that story are: wool origin, sustainability, ethical treatment of animals and growing quality Merino wool for customers around the world.
The Fibre Identification & Tracing Program is a newly formed program within AWI and the Woolmark company. It was brought about from the growing number of inquiries that come through wool brands and the Merino wool clothing consumers that drive those inquiries to the brands about being able to verify the wool’s origin or being able to verify supply chain and bring some transparency into things. It formed an area of investment for us because we saw some holes in what was out there. There are a lot of claims about provenance and about supply chain transparency, but in a lot of circumstances, it's not clear how that's verified.
For example, a Merino wool shirt label will say it’s made of 100% Australian Merino wool, or a 100% New Zealand Merino wool, but how does the customer know that's true? What's the technology behind that and what technology is out there that can verify that? That's really what we're looking at in terms of what we can provide the wool consumer, also any supply chain participants. That high confidence level of verification.
There are probably two things we look at. First, there's provenance in the sense of origin. Is your Merino shirt actually made of Australian wool? And, second, there's the broader supply chain transparency. As you can imagine, if we start with the Merino sheep and then go all the way to finished Merino wool clothing, there are a number of steps.
Merino wool is grown all across Australia in a range of different environments. But, they're all shorn on property and that's the hardest thing about keeping track of Merino wool. It gets piled up on the farm and then 90% is sold to foreign buyers.
That 90%, which we call greasy wool, is exported in an unprocessed state. So, the majority of the processing is done outside of Australia. It goes from shearing to sale to being shipped abroad. At the destination, it goes to scouring, or carbonizing, where the wool is cleaned. From there, it's carded and combed. After that, it goes to spinning where yarn is made. The yarn is either woven or knitted into fabric. Finally, the fabric is made into a Merino wool shirt, socks, underwear, etc. The finished wool garments are then distributed as a wholesale or directly to the customer. That's the overarching flow of Merino. It leaves the farm to get to a store somewhere in the world, from Los Angeles to London.
I suppose the challenge, rather than any sort of problem when you're looking at supply chains and transparency, is that there are just a lot of steps and a lot of people involved in those steps. Even before it leaves Australia, the Merino goes from the wool grower to a wool broker. The grower doesn't sell it directly. It goes through a broker and that broker sells to an exporter. So, there's a constant exchange even before it gets shipped abroad. And with that change in possession, there's always data that's being exchanged. Our challenge is to try and create a system that can seamlessly capture that data but capture it in a way that can't be tampered with.
Also, one of the unique things about Merino wool is that a lot of the raw Merino is blended. So, usually Merino wool clothing is not single origin, single farm. Some products, like coffee for example, are often marketed quite widely as single origin and, therefore, more desirable. It’s not the same for Merino wool. You do see single origin from time to time, but it's not necessarily a good thing because one of the arts of producing high quality Merino wool clothing is blending the highest quality wool fibers from multiple sources. It might even be blended with cotton, nylon, polyester, or with other types of wool to meet the specs of that final garment. And that blending process is an obstacle for traceability and provenance. You get all those fibers together and it's sort of like making a cake. You have lots of different ingredients coming in from different places and that complicates things a bit. It's not an unsolvable problem, it just makes things a little bit more difficult.
What is the purpose behind blending Merino wool from one place with Merino from other farms? Is it to achieve a tighter micron spectrum? Is it financially motivated somehow?
Yeah, it's probably a bit of all those things. No doubt it's financial in some sense, but the drivers would be technical specs. The knitters and the weavers will have particular standards they need to meet. And it doesn't need to be just 20 micron and 60 millimeters Merino fibers to meet those. There's a spectrum in there that they can deal with and hence, blending occurs.
Earlier, you mentioned tampering. When you say “tampering,” is it unintentional and a matter of a lack of organization or tracing tools? Or, would there be intentional tampering of the global Merino wool supply?
With a wool supplier, I think not. Not intentionally. There was a good example of intentional tampering in Australia with the honey supply chain. There's a major supplier of honey in Australia that had placed an order and found that they weren't selling a hundred percent pure honey like they had advertised.
Merino wool is a bit different. It's not uncommon, like we said before, for it to be blended with other fibers. Where I think that there could be some misinformation is with those broad claims of origin, whether it's a 100% Australian Merino wool or 100% New Zealand Merino wool. Because of the nature of the supply chain and all the blending that occurs, and people want Merino wool of particular quality or from a particular region, I think that puts pressure on players along the supply chain if they are trying to meet in a final order of a batch. That might bring in some opportunity to tamper.
So, if a customer buys a Merino wool shirt, for example, and the tag says “100% Australian wool,” it sounds like the chances of that being an accurate statement are pretty good, but that doesn’t imply single origin as in raw Merino coming from the same farm.
Correct. If you're a brand and you want to tell a story, you're doing it because you're standing behind the product you're selling. So, I have no reason to suspect that brands lie or anything like that. But, it could be a hundred percent Australian just not necessarily single origin, which is completely okay. Blending Merino wool from different farms should be looked at as an art form rather than in any sort of a negative sense. But, we would like to be able to scope a system where we could put a bit more rigor into it - so we could say exactly where that Merino wool is from if it's Australian.
What's going to change in the Merino wool industry if/when these traceability technologies are implemented?
That's a good question. We're running a number of pilots and we're looking to provide opportunity, but not necessarily change the way Merino wool growers conduct business. There are a lot of good stories that can be told and we're just looking to be able to profile those Merino growers.
We're not looking to enforce anything. That's why earlier I mentioned the difficulty with data capture and doing it in a seamless way because there won't be any adoption by the participants across the supply chain if you tack on another job for them to do. So, that's not our role. We don't want to get involved in their day to day business. But, if we can demonstrate an opportunity for Australian Merino wool, then that's why that's our interest in this space.
I imagine that there would be Merino wool growers that would welcome it because some farms already advertise themselves as growers of the best Merino wool in the world - or the “most sustainable” or the “most ethical” by using the most advanced growing technologies and methodologies. If those wool growers can then support that story by saying to the customer, ‘Check your clothing. Check the tag,’ to see that the Merino was grown at their specific farm - that would be a huge benefit to them.
Definitely. There are tremendously engaged Merino growers in Australia that have every right to be extremely proud of what they've done and have been doing for such a long time now. Multi-generation Merino wool growing families that are experts at what they do. AWI wants to provide the opportunity for them to get recognition and have their story reach a larger audience.
AWI a few years ago created a subsidiary company called WoolQ which I also do some work on. This is a small, digital platform that Merino growers can sign up for and it starts the data repository and traceability journey from the farm. So, if you were a Merino wool grower you could create a profile.
Merino wool growers send off their wool to get tested and all that test data comes back and sits in your WoolQ profile. It also says who you sold the wool too and for what price. But, this platform also allows you to create a profile and tell your story with pictures and videos. Merino farms can talk about the type of wool they produce; how they produce it; if they’re a part of any quality schemes; things like that. So, those are sort of the building blocks of what you're talking about and something where we're working to build an app in the hope that it is a way for those engaged growers to profile themselves. Because it can be quite hard if you're a brand looking for Australian Merino wool. For example, if you’re a brand in London or over in LA, it's hard to find those growers. But, if there's a central platform - I look at it like a LinkedIn for Merino wool growers - that you can search and find Merino growers that might tell a similar story that you want your brand to tell, that’s what we’re aiming for.
I was at ISPO in Munich several years ago, and there were one or two clothing label businesses. They were basically saying the future of labeling is where a customer can scan the UPC code on the Merino clothing hang tag and the whole history of the raw wool in that garment will show up. Is that something that you guys are involved in? Or, is garment labeling somebody else's domain?
No, at the end of the day, it's the brand's domain. But, Woolmark itself provides that quality assurance and certification that certain Merino wool clothing meets a particular quality standard. That's been our involvement historically in the labeling game.
What I should make clear is that the projects that we're involved in now should be looked at as pilot projects. We're trying to see what technology is available; at what cost; and what appetite for it there is across the supply chain. As part of that, we're about to start a few trials with two to four brands that'll trace their Merino wool all the way through the supply chain using blockchain technology. At the end, we're talking about how we might communicate that particular Merino wool’s journey to the customer. And certainly, we're looking at different ways we can use wool clothing tags to do that. So, I suppose the short answer is that we're watching that space and seeing what's possible.
All the technology we’ve talked about so far seems to be in the data collection and data security arena. Is AWI looking at technologies or methods involved in the physical handling of the Merino wool itself to keep it secure?
In other words, it seems you’re talking about putting the raw Merino wool in some kind of digital ledger to trace origin. But, recording wool’s origin doesn’t protect it from tampering. So, is AWI looking at the physical methods of the transportation and handling to protect the integrity of the raw wool along the journey to the customer’s closet? Because the Merino is blended, baled, stored, shipped, processed and distributed across multiple countries before it comes into possession of the end customer.
We’re looking at different technologies and there is some wonderful tech out there in traceability now. One of the avenues is blockchain which does a tremendous job at digital security and creating an immutable digital record. But, it can only do that digital record. So, we're looking at what else we can do to guarantee the Merino fiber that was purchased from the grower is the same fiber that ends up as a finished Merino shirt, sock, or underwear in the customer’s drawer.
And there are a few things out there that can help. We've got an ongoing trial at the moment with a company that specializes in isotope tracing. It’s a technology that looks at a Merino wool sample from any part of the supply chain - and the idea with the trials is that we do that at every single part of the supply chain - and see a carbon profile of that Merino wool and match it back to the origin. With this type of tracing, we're investigating how specific we can get. So, for sure we can identify the country of origin as Australia. And we were confident that we can do regions in Australia such as the New England region of Australia or the Flinders Ranges. And now we're working to see if we can go as far as tracing to a particular farm. So, we take samples from neighboring farms to see if we can isolate the Merino and identify the farm of origin. So, I guess that means we could feasibly do an audit of a Merino wool garment that says it's from these particular farms or this particular region or Australia and verify it using that isotope technology.
I know the cotton industry has looked at it quite extensively. And I think I've seen it used in fisheries as well. So, there's quite a lot of tech out there. We spoke to another company the other day that does a similar thing, but using trace metals. But,the same principle applies that you can find these unique markers from the origin that those unique markers remain in the fiber throughout the whole supply chain. So, we might get to the end of our discovery and decide that is a solution that we're interested in continuing to invest on behalf of Australia.
You mentioned the end of the project. Do you have a timeline to make those kinds of decisions?
The projects are at different phases. The isotope tracing is well underway whereas the blockchain trials are in a scoping phase and we’re looking to engage brands as we speak. But, the supply chain journey hasn't begun yet. So, that'll be 12 months off before we can look back at the results and make an assessment about the success; how difficult it was; how costly it was; and what the appetite is for the tech by the entities along the supply chain. Additionally, we have to ask, ‘What do the consumers want?’ Does the buyer of Merino wool clothing just want provenance? Or, are they interested about the full Merino wool supply chain? There are many questions that haven’t been answered.
How will these efforts by the wool industry measure up to the traceability of cotton and other fibers?
I won't profess to be an expert on what cotton is doing. But, I guess if we're talking about supply chain transparency and traceability for fibers as a whole, then it would be silly not to try and learn from each other. There are a lot of private companies that offer traceability services that work across industries. They're fiber agnostic. They don't mind whether it's Merino wool or not. They're just trying to provide a solution. So, I know cotton has done some work in the space of scientific methods of tracing the isotopes and trace metals in terms of commercial solutions. I think that would be brand dependent on what's there.
Nevertheless, more transparency equals a better platform from which we can tell the Australian Merino wool story. That is a competitive advantage - the way Australian Merino wool growers look after their animals and the intrinsic link of looking after your animal and producing a quality fiber. There are a lot of good stories to be told there.
Consumers and brands are always concerned about the eco credentials of what they produce. The way that Libertad sells its Merino wool shirts is that we say the shirt outperforms cotton and polyester in a number of ways. If we can add traceability to the list, it would absolutely increase the value of the brand and the cachet of Merino wool clothing in general.
As an individual and a brand, these are things that I care about and I think my customers do too. At this point, they just trust that I’m going to take care of it for them. But, in the future they might require more proof and I’d like to provide it to them.
In your program description, you used the terms “biosecurity” and “hostile global environment.” It almost sounds like pirates are commandeering ships full of Merino wool. That would certainly make Merino’s story more exciting, but can you tell me what you are talking about in more detail?
That made me laugh that those two terms got kicked out. “Hostile global environment” does really jump out when you read it again.
I'll start with “biosecurity.” So, biosecurity and traceability are heavily linked. Biosecurity in Australia in the sense of ensuring our sheep and plants remain free from disease. Or, if there is disease we can isolate it and treat it is hugely important. And I mentioned competitive advantage before, but that is a competitive advantage for Australia being sort of an Island nation. We can manage, and have managed, to keep a lot of diseases out of Australia. Of course, we want to keep doing that.
We have a good biosecurity program in Australia and there’s a national framework for biosecurity. All primary producers or farmers contribute to that framework. And we want to keep bolstering it and traceability adds to it. For example, if we can trace individual sheep and their movement around Australia and there's a disease outbreak, we will be able to isolate it. And the same goes for wool and wool bales. We want to be able to trace which farm it comes from. So, every farm in Australia has a property identification code and the Merino wool that leaves that farm is linked to that ID code. Then we know where it goes.
With more and more technology coming in and the lower cost of that technology there's opportunities to improve that system. And that's not something AWI alone is interested in. There are a few other organizations in the country that we're working with to improve that.
So a good example, I suppose, of why it's important is foot and mouth disease. We don't have that in Australia. And if that disease came into Australia, that would have severe impacts for the Merino wool industry. Foot and mouth disease can be transported through Merino sheep. Or, it can remain viable in the raw wool once it's harvested from the sheep. So it could feasibly stay in a wool bale. Which means that if there was an outbreak in Australia, and 90% of our wool is exported, it's quite likely that would put severe pressure on those trade partnerships.
Take China, for example. It's a huge biosecurity risk for them if they were going to import our wool and there was an outbreak of foot and mouth in Australia. That’s why we put such a weight on the term ‘biosecurity’ and why it's one of our key interests in terms of a hostile global environment.
It comes down to the farm and a social license to do your business. And so, in a world where everybody's more connected and the ability to interrogate products and supply chains is much easier and takes a lot less effort. Which is a good thing because with the quality, like you said before, if you have a supply chain you might not have confidence in the way certain producers go about things.
But, I think the nature of what Australian farmers do, they're sort of stewards over land and over animals and both of those things are quite emotive topics for people. So, they have a big responsibility to look after those animals and to make sure they're looking after the land as well. And no doubt, like with any industry, there may be a few bad examples that have been splashed up in the media and with that comes some hostile criticism. So, that's what we're talking about when we talk about a hostile global environment. It’s now much easier to point the finger and say you're doing the wrong thing.
For that reason, we wanted to build a bit of rigor around the Australian Merino wool supply chain, so it's a bit more evidence-based. Now, when people point the finger we can in fact say, ‘No,’ that these producers are world leaders in the way they look after their animals and their land. They've been stewards of this land for 200 years. With technology, you can do a much better job at recording the carbon profile or the biodiversity on a farm. So, there are a lot of good stories to tell that stand up and we can defend ourselves in this hostile global environment.
When I get questions from customers, I have to go to the factory at this point and not the source of the raw Merino. So, if the factory doesn’t really have an answer because they buy so much wool, where do I go? It would be tremendously helpful to have the traceability so I can confidently answer any questions regarding the Merino that goes into our clothing.
I also like that traceability will likely raise standards of production. In some ways, even the people that are pointing the finger and the people that are getting pointed at, in some respects are on the same side in that they both want to protect the animals and they want to protect the land.
Definitely. I think that's a good point to make, you know, none of these are bad things. I think it's a good thing that the people interrogate supply chains and interrogate the way animals are kept because they are important issues.
Mark, to close things out, I wanted to just ask you if there's something that I've missed that you think that anybody that a consumer or a brand should know about?
I come from the on-farm research team which is heavily involved in the way producers go about their business and the constant churn of things they're looking to improve on the farm. So, if I was to talk about something, or achieve something, in my role for traceability, it would be linking the consumer to those farmers because there's a tremendous story there to be told. Because all these producers meet not only a legal framework in terms of the responsibility to look after the welfare of their animals - in Australia there are strict regulations that they need to meet - but, there's also just an immense pride in the way they go about their business. So, if there are any Merino wool clothing customers reading this article, I would very much encourage them to go out and learn about the constant innovation and research that the Australian wool industry invests in to always lift their game. There are quite a number of interesting little pieces of research constantly going on.