South Australian-based industrial fibre company Michell Pty Ltd is expanding its operations in Australia and China with the purchase of wool textile company, Chuwa Wool Industrial Co (Taiwan) Ltd. It has also signed a contract to buy two wool carbonising lines and one Loosewool Superwash line.

"It's long been our plan to expand our wool supply base beyond Australia," joint managing director Peter Michell said.

"Until now, we haven't been in a position to source wool from China as we had no way of processing it to a point where it was able to be exported.

"However, with the acquisition of the two new carbonising lines we will soon be able to source raw wool from within China, process it on-site in China and then on-sell to a diverse range of international customers across the entire fibre supply chain - from textile manufacturers to major retail brands."

Establishing the carbonising lines in China will mean freight savings for Michell in the long run and Peter Michell said the purchase of all three lines had the potential to increase annual company turnover by as much as $30 million.

"We're also looking forward to increasing our employee base in Asia," Peter Michell said. "Over 50 employees will be required to operate the carbonising lines - and these positions will be sourced from within China."

Joint managing director David Michell added that the company intends to move the two wool carbonising lines from Taiwan to China early in the New Year. The first is scheduled to be re-located in January 2006; the second in June 2006.

The Loosewool Superwash line will be moved to the primary Michell base in South Australia where it will support the group's growing bedding wool business and value-add to the already successful Australian carbonising operation.