AWI considering Wool Exchange Portal generating industry benefits of $38 million in its first fifteen years. Based on an assumption that 15 percent of Australia’s wool growers producing about 36pc of the nation’s clip would use the WEP in its first five years, a WEP business case commissioned by the group has extrapolated $38 million in consolidated industry benefits over 15 years. WEP-WG chairman Will Wilson says that these advantages are assumed to come from cost savings to growers generated by the public reporting of broker fees
Wilson says the Wool Selling Systems after calculation could shed to port to be around $166. The WEP’s annual operating cost has been estimated at $860,000-$890,000, it is further expected to be self-funding within three years as per the business case model.
The Australian-based technology company Levo has been contracted by AWI in a “discovery phase”, to build the online portal at a cost $3-$4 million.
Wilson says that the working group hoped to get people using the WEP for trading wool and for getting information on trading options. He stated that a ready reckoner would be developed so growers can input their “specific parameters” and find out their most cost-efficient way of selling their wool. The WEP might also have a role in facilitating long term supply contracts with processors within the industry regimen of testing and payment guarantee he added.
AWI believes the WEP will deliver greater pricing efficiency and increased competition within the wool selling system as well as providing all industry participants with a one-stop portal where all buying and selling options can be transparently evaluated and future price realisation mechanisms can be accommodated and made available.
According to the AWI engagement of Levo will allow the industry to target specialty service providers to best fit the various offerings that the WEP will aim to provide. It will also be a more cost effective use of funds and reduce the likelihood of duplication where certain software may already exist.
The industry and stakeholder consultation involved with the WEP began in 2014 and has involved a significant number of meetings, discussions and publications.
