The rescued wool spinning plant at Milton on South Otago is back in business
The Quality Yarns plant, which made specialist knitting and weaving yarns, stopped processing late last year.
It blamed competition from imported yarns and rising compliance costs.
Farmer-owned investment company Wool Equities and a group of knitting companies who relied on the plant for their yarns formed a consortium to get it running again.
Wool Equities chairman Cliff Heath, a director of the consortium, says the plant is expected to spin its first yarn this week.
Mr Heath says Wool Equities has invested about $300,000 to reopen the plant and has a 77% stake in the consortium.