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Australian wool industry protects itself with blockchain
THE AUSTRALIAN wool industry and its partners have begun tracing the lifetime journey of authentic wool products by utilising blockchain technology.
The approach is an initiative between Everledger, a global pioneer in provenance technology, and the not-for-profit body for the Australian wool industry, Australian Wool Innovation (AWI).
Everledger and AWI, which is also the parent organisation for The Woolmark Company, have now completed their proof-of-concept stage. Information has been captured along the wool supply chain to enable verifiable provenance and chain of custody using blockchain technology.
In line with AWI’s strategic response to enabling material traceability, capturing the flow of wool information enables verifiable claims of origin and sustainability, supports biosecurity efforts, and can deliver compliance and ESG (environmental, social and governance) reporting efficiencies.
John Roberts, the acting CEO of AWI, said this offered value to all parties, whether that is attracting new buyers or higher prices for growers, enabling verifiable information for certifiers and regulators, or equipping apparel brands to have a robust point of difference with their finished garments. 
Mr Roberts said he was delighted that the project had materialised real industry examples of how this could be done, as well as generating insights from market participants about the value of these efforts.
“What is clear from this proof-of-concept is that there is demand across the value chain and by stakeholders for the wool industry to deliver on traceability, and we look forward to advancing on the gains made here as well as the recommendations made in the recently published Traceability in the Australian Wool and Sheep Industry report by WoolProducers Australia for the benefit of Australian woolgrowers.”
RIDING ON THE SHEEP'S BACK
Merino sheep are celebrated globally for producing the world’s finest, softest and most beautiful wool. Australia produces around 90 percent of the world’s fine apparel wool and this makes significant contributions to the Australian economy.
The fibre is natural, renewable and biodegradable. Mr Roberts said many Australian woolgrowers were able to demonstrate that their farms can sequester carbon, increase biodiversity and strengthen climate resilience, “but many of these important messages aren’t making it to market, or if they are, lack the substantiation to make the claims credible”.
APG & Co has a portfolio of well known Australian brands including Sportscraft, SABA and JAG. APG was a proof-of-concept participant.
Genevieve Moody, social and environmental manager at APG & Co said of the experience, “The need for fully traceable apparel supply chains is of paramount importance not just for our business but for our customers as well. Due to the complexity of supply chain tracing, it was great to work directly with Australian Wool Innovation and Everledger to see genuine traceability improvements.
“Being a part of the proof-of-concept has not only allowed us access to a fit-for-purpose tracing solution, it has also provided the opportunity to discuss ethical and sustainability data collection points we would want to have integrated in future.
“It has been enlightening to be involved in the development of the tool, which can guarantee the authenticity and reputation of our claims. We look forward to continuing our engagement as this work matures into an industry solution.”
SUCCESSFUL PROOF OF CONCEPT
The proof-of-concept involved seven distinct supply chains tracing from wool growers, through brokers and export, to scouring, combing, spinning and dyeing, to weaving or knitting and the final product. It worked closely with all parties in those supply chains, as well as end-consumer brands, to understand the nature of business processes, the data available, and the types of claims different parties wished to make.
Key to the success was establishing a prototype tool that enables upstream or downstream supply chain participants to invite associated parties, helping to navigate supply chain opacity in a trustworthy manner.
The information supplied was grounded in blockchain, offering immutable records authored by each party to be stitched together to create a full picture. The solution enables retailers or end consumers to be able to verify where and when the original wool was produced, and key stages in its journey to market.
“We love working with visionary partners,” Everledger CEO Leanne Kemp said.
“Traceability used to be considered a nice-to-have, now in multiple supply chains and across many material types, it is essential. Other industries, such as critical minerals and batteries are now rapidly responding to regulatory requirements for transparency and accountability, such as those coming into effect through the European Union in 2023, or to resolve questions of Modern Slavery or greenhouse gas emissions.
“AWI is taking a lead for other traditional industries in Australia to follow, and in doing so demonstrates both responsible leadership and an acute vision to see how blockchain combined with other technologies can generate significant economic value and sustainability.”
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