A director of the consortium set up to keep the Milton woollen mill spinning is confident it can survive the tough times troubling the wool processing industry.
The South Otago plant, which makes specialist knitting and weaving yarns, is back in operation after competition from imported yarns and rising compliance costs forced it to stop processing late last year.
Farmer-owned investment company Wool Equities put together a consortium with knitting companies to get it running again.
Wool Equities chairperson Cliff Heath, a director of the consortium, says staff have been hired and machinery tested, and the plant should start processing yarn again this week.
He says it has three months' worth of orders and should not be exposed to the downturn affecting carpet processors because it is not involved in that sector.
Mr Heath says the wool from the mill is predominantly going into garments and bedding.
He says the New Zealand made wool garment industry is looking good. "There is a great demand for quality New Zealand made, and guaranteed New Zealand made, woollen product ... that is, the wool's grown here, the yarn's spun here and the garments are constructed here."