Luxury Italian clothing company, Loro Piana, says it's looking elsewhere for wool because of Australian Wool Innovation's lack of progress on finding alternatives to mulesing.
Speaking in Australia this week, Emanuela Carletti, the company's head of raw wool procurement, said Australia had to face what the retail world was demanding from its suppliers.
"The lack of concrete alternative solutions to mulesing from AWI has forced us to look elsewhere for our raw wool," she said while visiting growers who were looking at alternative practices to mulesing.
"Australia has not been collaborative when it comes to dealing with the mulesing issue," she said.
"Other countries now sell their wool at a premium to Australia and we have turned to them to source our raw fibre.
"We have been long term supporters of Australian wool growers, however we have now come to a point in which we are no longer willing to purchase wool coming from mulesing.
"Alternatives exists, in fact other countries supply exactly what the market is demanding.
"Far from being in a position to tell the growers in Australia what they should or should not be doing, we only want to make them aware of what the market is requiring and what our company code of conduct and ethical principle demands us to do."
Her views have been reinforced by European processor and wool buyer, Laurence Modiano, who said the market was sending strong signals that it wanted only non-mulesed wool.
"No brand or client has so far accepted pain relief. And not for want of trying by many Australian organisations and individuals," he said in a social media exchange with AWI board candidate, George Falkiner, Haddon Rig, Warren.
Australia could sell all its wool to China abut would face price volatility, he said.
Mr Falkiner has said phasing out mulesing was a critical issue for the industry.
Loro Piana's Australian representative, Roland Gill, said Australian growers should look at the evidence of the marketplace.
"Many firms and mills are paying well above market for NM status declared wool. Mulesing is simply not acceptable at retail level any more.
"We encourage the research arm of AWI to find a genetic solution quickly and we are willing to help and support in any way.
"Loro Piana prides itself to serve extremely conscious and demanding clients who trust our company and are willing to buy only if they can trust our whole supply chain.
"We will continue to support Australia's wool industry but advocate change in (AWI) directors to cease mulesing.
"We would love to see people like (Victorian Merino stud breeder) Noel Henderson, who ceased mulesing in 2011, to bring new ideas and fresh thinking to AWI," he said.
Mrs Carletti will host Australian and NZ woolgrowers at an event in Milan next week where the announcement of the World Record Bale will be made.