The LOOM Review - Volume 01

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The Current State of Irish Wool: Lessons From the 2022 DAFM Wool Study

The original publication: Review of Market Opportunities for Irish-Grown Wool-Based Products, commissioned by the Department of Agriculture, Food and the Marine (DAFM) and prepared in 2022 by a consortium led by The Agile Executive. The 138-page report examines market opportunities and the economic potential of Irish-grown wool-based products.

Read the full report here.

This article offers an overview of the report and its findings, with references to the relevant pages throughout. Its purpose is to help readers navigate the publication and engage with the research presented by its authors. The full report remains the original and authoritative source for all findings and conclusions discussed here.

Background & Scope

In July 2021, the DAFM put out a tender asking for a review of the potential demand for Irish-grown wool in domestic and international markets, especially for products like insulation and fertilizer. The study was prepared by a consortium led by The Agile Executive, bringing together expertise from Munster Technological University, Donegal Yarns and Galway Wool Co-op.

This study was structured in four phases, such as finding market opportunities, identifying research projects that could support them, working out mechanisms to support the industry, and testing the economic feasibility of the main ideas. It drew on 18 interviews across six sectors, along with a review of every submission to the DAFM’s earlier public survey. Its stated purpose was to form the basis of a policy roadmap for the Irish wool industry.

Economics of Irish-Grown Wool at the Farm-Level

The report’s most distinct finding concerns farm-level economics (p. 79). Lowland wool was selling for around €0.20 per kg. A typical fleece weighs about 2.5 kg, so a farmer earns roughly €0.50 per ewe, and potentially as little as 0.10 for coarse hill wool. Shearing costs €2-3 per animal. Farmers are thus losing about €1.50 to €2.50 on every ewe they shear.

Against Teagasc’s figure of about €150 of lamb output per ewe, wool can be under half a percent of farm income. The authors note that shearing is now considered mainly an animal welfare task, and wool as a low-value byproduct or even a waste stream.

The Irish-Grown Wool Supply Chain

This report points to several structural reasons for the low value of Irish-grown wool.

The first reason concerns small concentrations of buyers, and rather fragmented sellers. There are around 45,000 wool producers on the island, and very few have organized into collective bargaining groups. Ulster Wool, supplied by about 5,000 farmers, is the notable exception. On the buy-side, the report counts only 41 registered wool stores and estimates fewer than 10 competitive buyers. Most Irish merchants are reported to have been acquired by the two largest UK merchants.

Irish wool is considered less suited to many contemporary garment applications compared to other imported fibres. Most Irish wool is classified as “strong wool”, meaning it’s coarser than about 32 microns. Suitable processing tailored to the needs of Irish-grown wool would make it a more viable option for textile producers, yet lack of attention to its needs has prompted a shift towards imported merino in the Irish textile sector.

Scouring is the industrial washing that almost every higher-value use requires, and there is no commercial-scale scouring plant on the island; the last accessible one, in Dublin, closed in the early 1980s. Scouring at scale in Ireland was outside this study’s scope, but it’s marked as a significant long-term question.

Some interviewees reported up to 10% of wool being unsaleable. When farmers are paid pennies, and otherwise shunned by the wider Irish textile industry, there is little incentive to skirt and sort fleeces. Because of this, this often stops buyers paying more for higher quality wool.

The report describes a major limitation being a dearth of usable data on breeds, grades, and what actually happens to wool after it leaves the farm. Its own end-use estimates rely on conversations with industry participants rather than hard figures.

Market Opportunities

The primary recommendation of the study is an All-Island “Irish-Grown” Wool Council: an industry-led body to build a brand, set standards, and build the fragmented sector together. Nearly all interviewees, the authors say, considered a brand an essential starting point (pp. 3-4). Around this sit several related recommendations for the sector.

A Wool Hub, where researchers and business would collaborate, with an independent testing facility and traceability for wool sent abroad for processing.
Dissemination of the co-op model; the report sees merit in cooperatives, as they can offer scale that individual farmers cannot. It suggests that farmers or a co-op keep ownership of wool until it has been professionally graded, since grading is where much of the value is created (pp. 4-5)
Training and better incentives; wool handling and grading trading, an apprenticeship modelled on the British Wool scheme, and possibly two-tier pricing for skirted versus unskirted wool.
Prioritization of fertiliser and insulation; these are established uses of wool that could absorb lower-grade wool, though both face cost barriers such as composting gate fees and the cost of scouring for insulation. Insulation would likely need grants or incentives to compete with glass fibre.
Protected Geographical Indication status for Irish wool textiles, research into composites, medical and cosmetic uses, a Life Cycle Assessment, and a feasibility study on scouring (pp. 100-102)

Looking at the Co-operative Model

The DAFM study provides an important foundation for understanding the Irish-grown wool sector and the opportunities for its development. Its examination of collective structures, wool grading, market opportunities and industry coordination informs many of the questions at the centre of LOOM. Through our case study of Galway Wool Co-op, we hope to explore the collective model in greater detail, building on the research and recommendations presented in the report.

Next in the LOOM Review: Limiting and Enabling Factors of Collective Farmers’ Marketing Initiatives: a review of the research by Knickel, Zerger, Jahn and Renting (2008).

Source: The Agile Executive Consortium for DAFM, Review of Market Opportunities for Irish-Grown Wool-Based Products (2022). All figures and findings above are drawn from that report, with page numbers referring to the report's own pagination.