Designed to appeal to today's trends, it provides a vintage look with the competitive edge of a modern fibre.
Mr Jackson said both Chinese companies had reported positive feedback from Japanese and Western European retailers with a particularly strong interest from US buyers.
Work would now be done in product development and if successful, orders taken for the northern hemisphere in the new year to prepare for a launch on the retail market it September.
"It's quite a radical move for the Chinese manufacturers who are used to producing traditional suit fabrics," he said. "They had not produced fabrics like this before and they were received better than they expected."
Mr Jackson said it was very important for AWI to establish direct business relationships with key organisations such as Youngor and Sunshine in the Chinese marketplace as Shanghai emerged as an international fashion capital.
"China is a constantly growing economy that purchases the majority of Australian wool," he said. "It is a hub for international brands to review products available and the quality today is astounding. To have AWI products at noted events such as Intertextile will assist AWI in achieving a higher demand for Australia Merino wool products."
Jiangsu Sunshine Group produces 30 million metres of worsted fabrics, 20 million metres of woollen and cashmere fabrics and 1.5 million suits each year for the domestic and export markets.
Younger, a popular brand in China, has had the largest share of the domestic market for its suits for the last three years. The 1.7 million suits it manufactures each year are sold in both domestic and international markets.
Mr Jackson said the partnerships with Chinese manufacturers would provide important opportunities for Australian woolgrowers.
"By working with Sunshine and Youngor we are able to offer buyers and manufacturers around the world Australian Merino wool alternatives which are high in quality, machine washable, light-weight, durable and fashionable," he said.
Intertextile 2006 attracted 52,265 visitors over the three days.
Australian Wool Innovation Limited
marketing@alchempro.com
