Elders comfortable with US response to ‘Just Shorn’ carpet range
Elders Rural Holdings, the rural services firm, is happy with the way its 'Just Shorn' brand is tracking in the US, and plans to roll-out the wool carpet range across the Tasman next month.
The 'Just Shorn' carpet brand is a partnership between subsidiary Elders Primary Wool, carpet-maker Godfrey Hirst and US-based CCA Global to target affluent consumers in the world's biggest economy, who were largely insulated from the recession. The carpets are being sold in 550 stores across the US and Elders will launch the brand in Australia in March in 50 stores, Elders Rural managing director Stu Chapman told BusinessDesk.
"That programme continues to go from strength to strength," he said. "The US market is still the most lucrative market that we can achieve volume in."
A 2011 spike in wool prices put wool carpet-makers, such as NZX-listed Cavalier Corp, under pressure as they struggled to pass on increased costs.
Elders Rural is half-owned by ASX-listed agribusiness Elders and Sredle New Zealand, whose owners include Chapman. Last year, the Australian company mulled buying out Sredle's stake as part of an exit of its rural services business, before giving up on the plan when it attracted the support of its financiers.
Elders Rural's Chapman said he's optimistic about prospects for the 'Just Shorn' programme, though it's still in its early days, and China remains "the major buyer by a long shot"
New Zealand exported $705 million of wool in 2013, down 1.7 percent from a year earlier, making it the country's 17th biggest commodity sold into foreign markets.
Chapman said last year's North Island drought led to a reduction in livestock and has meant the company has started 2014 a little softer with wool volumes below expectations.