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Vietnam – a growing textile sector with a desire for wool

I have recently returned from a trip to Vietnam as part of the Domestic & Diversified Wool Processing Project Phase 2 (ATMAC 2) project.

Work undertaken last year as a precursor to the ATMAC 2 project identified Vietnam as a priority market for the diversification of Australian wool trade. Vietnam’s strong projected textile sector growth, its reliability as a global business partner and its competitiveness and growing reputation as a producer of high-quality textile products and garments place it as an ideal partner for Australian wool.

Vietnam has an increasing demand for wool within its textile sector, with their wool spinning capacity soon to exceed 20,000 tonnes of wool tops per year (more than 200,000 farm bales), all of which is currently reliant on early-stage processing in third countries. This demand is projected to continue to grow in the coming years, with Vietnamese industry stakeholders are now looking at opportunities to undertake top making within Vietnam.

To support growth opportunities, WoolProducers secured an Australian wool industry representative as part of the Australian Chamber of Commerce Aus Hub project. Mr Kelvin Le has filled this role as a representative for the Australian wool industry in Vietnam since April this year. Since April Kelvin has been working hard to strengthen existing relationships, identify new and emerging opportunities for Australia-Vietnam wool trade and providing extensive support to the ATMAC 2 project

During my visit I meet with several industry stakeholders and industrial park operators. These meetings discussed the desire of the Australan wool industry to mitigate trade risk and the Vietnamese textile sectors desire to engage with a supply chain that can deliver quality, traceability and reliability. From these meeting it is abundantly clear that the time is right for direct Australia-Vietnam wool trade through the instigation of top making activities, either in Vietnam, or here in Australia.

While in Vietnam I also took advantage of an invitation from VITAS (Vietnam Textile and Apparel Association) to speak at their end of year conference in Hanoi, supported by Tony Harman, Australian Agricultural Counsellor based in Hanoi. I presented on Australian wool production and the positive attributes of our fibre across the micron spectrum, the ATMAC 2 project, Trust In Australian Wool and the Sheep Sustainability Framework. The presentation fit very well with the key theme of the conference, sustainability. The Vietnam textile sector wants to incorporate the use of more natural fibres and become a leader in the textile circular economy through the use of more renewable natural and recycled fibres – in this regard wool is a perfect fit! The Vietnam textile sector is also investing heavily in renewable energy and “green factories” that account for the needs of both the environment and workers.

A quote from the conference that resounded with me came from the Ambassador of the Netherlands, he said:

“As industries we must change our mindset, rather than pursuing profits by means of maximising margins at all costs in a dangerous race to the bottom, we must alter our mindset and invest in a sustainable industry through genuine pursuit of our CSR and ESG responsibilities- we must engage in a race to the top”

This quote, which aligns with the aspirations of both the Australian wool and Vietnamese textile sector bodes very well for both countries respective interests.

While in Vietnam I also had the opportunity to meet with members of the Australian Chamber of Commerce in Vietnam (AusCham) Board and AusHub Steering Committee members. The passion of the AusCham board and the work that AusCham undertakes to develop the Australia-Vietnam business relationship is inspirational to say the least. The differences in the business environments between our two countries combined with the substantial business opportunities, means that an organisation such as AusCham is integral to the advancement of sustainable bilateral business relations.

I would like to thank Kelvin Le and Edwin Law from AusCham (AusHub) for their support over the past 8 months, particularly in relation to the arrangements for this recent visit. I would also like to extent a special thanks to Tony Harman and VITAS for the opportunity to present at the end of year conference. I look forward to advancing the Australia – Vietnam wool relationship in the coming years. Please do not hesitate to reach out if you would like to arrange a discussion on the opportunities that the Vietnam textile sector presents for Australian wool.

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