By BECKY TALLEY
Sheep Industry News Associate Editor

(August 1, 2008)  When a business sees an average of 4 million pounds of wool pass through its door on a good year, it makes sense that this sign is posted in its office for all to see:

“Real Men Don’t Wear Polyester.”

And those that work for Center of the Nation Wool take these words seriously; in their business, wool reigns supreme; and in early June, the warehouse was stacked wall to wall with evidence of the hard work of those that produce it.

The Center of the Nation Wool Warehouse has been a fixture in the sheep industry for many years, giving territory wool producers a place to market their wool in both the domestic and international markets.

Its roots go back to 1960, when it first was formed as a wool pool for area sheep ranchers. However, the Center of the Nation Wool business officially came about in 1984, when it was formed into a private corporation and stock was sold to active sheep producers. Today, the board of directors consists of Larry Pilster, Alzada, Mont.; Jw Nuckolls, Hulett, Wyo.; Dave Niemi, Buffalo, S.D.; Spud Lemmel, Mud Butte, S.D.; Mary Buchholtz, Belle Fourche, S.D.; Larry Tauck, Hammond, Mont.; and John Lehfeldt, Lavina, Mont.

“We are very much producer driven,” says Larry Prager, manager of Center of the Nation.

A majority of the wool coming into the warehouse are the territory wools, mostly coming out of western South Dakota, Montana and Wyoming, with a smaller amount coming out of Idaho, Colorado, North Dakota and Minnesota.

“The heart of our wool business is the range style, and they are the ones leading the charge in genetics, quality and preparation,” Prager relates.

Center of the Nation does take some consigned wool, and buys a little wool dropped at the door, but mostly its primary job is to market wool to ensure that the producers get the most profit they can for their hard work and attention to quality. To make this happen, the warehouse also core tests a majority of the wool, further creating a marketing draw for potential buyers.

“We are the marketing link between the processors and producers,” he says.
And that link has become even more important as the American wool industry has evolved and expanded into different markets.

At one point, the majority of Center of the Nation’s wool was bought by a single entity, Burlington. However, the wool market has been changing in recent years, as American wool is gaining a foothold in the overseas markets, adding the competitive value to the domestic clip.

According to Prager, before 2005, Center of the Nation exported under 20 percent of its wool. However, in 2005, that number jumped to a whopping 70-percent export rate, with virtually all going into the European market.

Today, Prager says his export rate has settled back to about 50 percent, with China and India being the export growth areas in terms of processing and manufacturing.
“I think those opportunities are pretty critical for us,” he says.

China is currently the main influence on the wool market and the largest international buyer of domestic wool, but Prager also feels that Europe still holds excellent export opportunities for American wool.

However, for Center of the Nation, where the wool ends up is not as much of a focus as is selling it for the best price for its value.

“Our producers depend on us to find the best way to turn their wool into cash.  If that means shipping to China, so be it,” he relates.

However, he says that the majority of the wool that is marketed through the warehouse still stays here in the United States and is used by the military. Foreseeing a stronger military demand, Prager thinks more of Center of the Nation’s wool will stay in the domestic market in the next few years, which is crucial to keep the remaining wool processing mills viable.

But no matter the buyer, the most efficient way to improve value at the ranch level is to start working with the growers before shearing. 

“My interest comes from the production side,” says Prager, who made his way through college shearing sheep. “It’s pretty easy to work with the producers who often can make small adjustments that pay real dollars. We help them package the best quality wool possible.”

He stresses the need for strong genetic selection for consistent, quality wool – a need that is driven by international buyers.

“They see U.S. wools as inconsistent and are concerned about being able to buy the same load of wool every time,” he says of their requirements, adding, “You can travel halfway around the world, and they still want to talk about the chance of poly contamination in U.S. wool.”

Because of this, Prager works with producers to ensure that they are aware of contamination issues and take responsibility at shearing time to make sure the animals are properly sorted and the wool is prepared and packaged properly.
“At the end of the day, we are going to sell quality,” he says.

And it seems that the producers who market through Center of the Nation Wool have had a lot of success with their wool programs.

According to Prager, he has noticed that the Chinese buyers recognize Center of the Nation, and particularly “the Belle Fourche wools,” as a trademark of good quality in the American wool industry.

“When they (international buyers) come here, they have always been impressed with the quality,” he adds.

With this acknowledgement of quality from key buyers, Prager has every expectation that the wool industry will continue along a strong path, though he mentions that it will face some challenges.

In addition to the usual volatility of the wool market, a key issue is the price of freight and shipping for everyone in the market, from the producer to the processor.
“The whole industry, top to bottom, is affected by freight,” he says.

Equally as important, the situation with shearing crews could be a future problem for producers, as the shearing and the related options for producers are a big question in everyone’s mind.

“We got by pretty well this year, but it is always a primary topic of discussion,” he says.

However, there is much to be celebrated in the industry.

“We’ve just seen one of our best wool years,” he says, adding that this is the first year he has actually had people contact him for help with buying more sheep, to either start out or to add to their flock. “They are serious about it. They are trying to learn,” he says.

And luckily for these people, they will have Center of the Nation to support them in their endeavors and to continue to push quality wool for the best value, because according to Prager, he and Center of the Nation exist purely for their customers.

“For most producers, the only spring income is the wool check. That’s an important check, and we take it very seriously,” he says. “I don’t mind working long hours on our producers behalf because most producers are working harder and longer than I am.”