SUCCESSFUL Victorian private treaty network M&M Wools has been bought by exporter and trader Queensland Cotton.
Queensland Cotton's wool business head Michael Avery confirmed the buy this week.
M&M was established in 1985 by proprietor Paul Miall and former business partner John Mahoney.
Mr Avery said Queensland Cotton would retain all of M&M's seven regional stores and existing staff, including Mr Miall and Roy Mapleson.
He said the deal would allow Queensland Cotton to expand its buying and brokering business into Victoria.
He said that, although a show floor would be retained in the short term at M&M's Footscray store, Queensland Cotton was planning to move all of its Melbourne operations, which included cotton storage, to a new site at Derrimut.
The acquisition adds to Queensland Cotton's purchase of the NSW broker Western Wool in 2009.
The M&M sale to Queensland Cotton, a subsidiary of the Singapore commodity trader Olam International, is part of a trend adopted by Australia's four leading wool exporters to shore up their supply lines by offering private treaty and broking services.
The Canadian-owned Viterra has a strong network of regional and agency depots through South Australia, Victoria and NSW.
This was the result of its purchase of the exporter ABB Pastoral, which in turn had acquired the private treaty and broking business of Adelaide Wool.
Rod Franklyn's Techwool Trading has built its business of private treaty, broking and exporting arms rather than depending on acquisitions.
A similar growth pattern has evolved for the Fox and Lillie, which has expanded its regional network beyond Victoria into northern NSW and Queensland.
All four exporters, which account for nearly 40 per cent of the auction clearance, see their business as offering growers the convenience of a full range of marketing options.
Acting as buyer, broker, trader and exporter is a position that doesn't sit easy with the traditional brokers, who will privately argue it is a position that might not always be in the interests of the grower.
But with 80-84 per cent of the 2 million-bale clip going to auction, fewer than 400,000 bales are going direct.
Some of these non-auction sales to overseas processors are through arrangements facilitated by the traditional brokers.
