The Wool Market

By Lindsay Warner April 25, 2015
Editor’s note: This is Part 1 of a four part series:
Part 2: Wool’s Renaissance       Part 3: An Interview with Icebreaker’s Jeremy Moon      Part 4: Bullish on Wool


Perched on the shores of New Zealand’s Lake Wakatipu and surrounded by the island nation’s Southern Alps, Mount Nicholas sheep station creates a stunning backdrop for the merino wool industry. About 31,000 merino sheep graze 100,000 acres of rugged high-country terrain, making Mount Nicholas one of the biggest stations—or ranches—in New Zealand and one of the merino-wool industry’s largest suppliers. It’s also one of its most sustainable.

Entirely powered by hydroelectricity, the station is largely self-sufficient, thanks to an enormous garden, orchards, fresh game and a milk cow. Equally important, this focus on sustainability and environmental best practice trickles down to create happy sheep. And happy sheep produce high-quality wool.

“When a sheep is stressed, it creates a weak spot in the fiber that’s prone to breaking,” says Kate Butson, whose parents, Robert and Linda, bought the land in 1976. She manages Mount Nicholas with her husband, Jack. “Weak fibers can lead to pilling or holes in a garment spun from that wool, which obviously affects quality.”

When quality control hangs on a grower’s ability to maintain stress-free sheep, it naturally encourages best-practice farming methods. Accreditation programs such as New Zealand’s ZQ Merino, Australia’s NewMerino and Argentina’s Ovis 21certify growers that adhere to strict animal-welfare, environmental, social responsibility and fiber quality standards. Those standards impact how merino farmers treat their land, livestock and the people who work their property, and a certification conveys credibility to the brands and their increasingly conscientious consumers.

As a biological product, wool is “engineered by nature.” But the supply chain that takes it from sheep to shop can vary dramatically in terms of ethics and environmental practices, as brands are responsible for policing their own supply chains. For brands that source and use wool in their products, the OIA Sustainability Working Group’s Wool Task Force can be a powerful tool in achieving best-practice production.

A partnership between OIA and Textile Exchange, the task force creates and implements guidelines to ensure animal welfare and sustainable farming and manufacturing processes throughout the supply chain. The task force also ensures increased visibility into the supply chain through established traceability systems, helping companies manage quality control, ensure animal welfare and adhere to better environmental practices.

Being able to communicate these facts and benefits to the end-user is a crucial step in promoting one of the industry’s most sustainable and high-performance textiles. Here’s what apparel manufacturers and retailers—and ultimately, their consumers—need to know about merino wool and sustainability.

1. Merino wool is a renewable resource.

That might seem like a no-brainer, but according to Keith Anderson, vice president of marketing for the Vermont-based Ibex Outdoor Clothing, you’d be surprised at how many people don’t realize that merino sheep are sheared—not slaughtered—for their wool. “Consumers don’t always realize that it’s a haircut,” Anderson says. “It grows right back. An average merino produces enough wool for five to six sweaters per year, and 30 to 35 sweaters over the course of its life span. It’s a naturally self-renewing product.”

2. It’s biodegradable.

Merino fiber is made up primarily of proteins called keratins, which break down quickly—even after the fiber has been spun into wool and then woven into a garment. In a test conducted by New Zealand Merino, a 150-micron-weight shirt that was buried in soil for nine months virtually disappeared. At the end of the test, only its seams and tags remained.

3. Traceability is worth paying more for.

If you’ve ever typed the nine-digit “Baacode” included on the inside of every Icebreaker garment into the Baacode tracker on the brand’s website, you’ve experienced the power of traceability firsthand. Each unique code tracks the merino in the garment back to the farms it came from and is accompanied by a short farm story and photos. Is it a marketing gimmick? Sure. But it’s also representative of the two- and three-year sourcing contracts that now exist directly between growers and brands such as Icebreaker or between wool “sourcers” like New Zealand Merino who supply the likes of Smartwool and Ibex. The fixed-rate contracts are priced to mutually benefit the brand partner and the grower, guaranteeing a supply of top-quality, accredited wool for the brand and a solid business plan for the grower.

4. Not all wool is created equal.

Sourcing contracts are contingent upon farms meeting extremely high standards for quality, sustainability, environmental integrity and animal welfare. The end result is a top-quality, ethically produced and fairly priced fabric. Sure, brands can buy less-expensive merino fabric on the commodity market. But there’s no assurance that the source animals were treated humanely or that the fabric was manufactured responsibly. In farming, a fluctuating commodity market almost always guarantees financial strain, which in turn often manifests in growers abandoning their best intentions. “Desperation is often the single biggest impact on sustainability,” notes Dave Maslen, global brand manager at New Zealand Merino. “When times are bad, growers start carrying more stock than their land can sustain, and they engage in less-desirable growing practices.”

5. Merino is a low-maintenance technical fabric.

Merino wool is naturally antimicrobial. Translation: It’s stink-free. Compared to synthetic materials that capture and retain odor—often indefinitely—wool requires far less-frequent laundering, which means less water use and fewer detergents in the water supply.

And also: Some things can’t be helped…

Like sheep passing gas. Smartwool estimates that the greatest CO2 contributor in its supply chain is due to sheep emissions. Methane from hundreds of thousands of merino sheep causes measureable environmental damage, and there’s not much you can do about it. (Well, except hold your nose.)

If you’d like to learn more about materials traceability and sustainability issues, join the Sustainability Working Group or contact