CHINA PLANS TO BOOST SHEEP FLOCK BY 20 PERCENT

CHINA PLANS TO BOOST SHEEP FLOCK BY 20 PERCENT

China intends to increase its sheep flock to 120 million head over the next three years, up 20 percent from the current flock of 100 million head, as demand rises, said Shou Yunzhong, the president of China National Textiles Import and Export Corp.

Domestic demand for wool is based on increased sales of suits and sweaters in urban areas, but consumption in the country remains low, the Daily Commercial News newspaper quoted Mr. Zhou as saying.Chinese exports of woolen goods are growing fast and are helping to support wool demand in China, Mr. Zhou said.

He was in Australia last week to announce the establishment of the Chinatex (Australia) Wool Co., a purchasing company.

In reference to Mr. Zhou's remarks, a director with the Wool Exporters Council of Australia said China is committed to expanding wool production, but it would not be easy for the country to build up its sheep flock.

Sheep are mainly bred in the northern regions of China, such as Mongolia where climatic conditions are so harsh that the animals must be housed in large barns during the winter, said Len Johnston, Australian wool director.

Mr. Zhous said Chinese wool purchases from Australia are mainly of finer types in the carding and combing categories.

Despite the strength of the Australian dollar, particularly against the U.S. currency, Chinatex can write its buying contracts in various currencies to offset any further rises in wool prices resulting from foreign exchange moves, Mr. Zhou said.

Mr. Zhou said that China would purchase record amounts of wool from Australia if the price is right.