Wool carpet manufacturers across Europe are facing growing pressure as synthetic flooring products continue to dominate the market with significantly lower prices. According to Portuguese carpet producer Lusotufo, a long-time Wools of New Zealand partner, cost remains the decisive factor for many consumers — despite rising awareness around the environmental impacts of plastic-based carpets.
Duarte Oliveira, executive manager of Lusotufo, says the European floor-covering market has become increasingly competitive, tightening margins even for established manufacturers. While wool continues to be valued for its natural quality and durability, its higher price point keeps it in a niche category.
Synthetic vs. Wool: A widening price gap
Oliveira notes that in major markets such as the United Kingdom, customers face a stark choice:
- €2/m² for polyester, versus
- €5–€6/m² for wool.
“It’s always a balance between price and demand,” he said. “There is a lot of talk from people aware of the problems with plastic, but at the end of the day you are seeing more and more plastic products in both carpets and garments.”
Lusotufo — Europe’s second-largest carpet producer and one of the region’s major wool yarn manufacturers — sources wool from Europe, the UK, and New Zealand. But Oliveira says all growers are struggling with low incomes. Merino producers in Spain and Portugal who received €1.90/kg three years ago are now getting €0.60/kg.
China’s influence on global wool pricing
The dominance of Chinese wool buyers remains a major force in price fluctuations.
“Every time China gets busy, prices go up. When China goes quiet, prices go down,” Oliveira said.
Lusotufo buys scoured New Zealand wool — already the most expensive in the world — and even a small increase of €0.50–€1 per kg significantly affects retail prices. As a result, manufacturers become reluctant to introduce new products, and consumers resist higher costs.
Demand for wool remains — but stays niche
Oliveira believes wool carpets will always have a customer base thanks to their superior quality and performance. Each square metre of Lusotufo carpet uses 1.5–2kg of wool, blending New Zealand and British fibres for added resilience.
However, he warns farmers not to rely on wool as a primary income source.
“Sheep farmers should not count on wool to drive their business,” he said.
He also urged New Zealand growers to maintain strict quality standards, particularly around minimising black fibres and vegetable matter.
“The day NZ quality declines to the quality of other wool, then NZ loses its advantage.”
Push to reduce the cost gap between wool and synthetics
Wools of NZ chief executive John McWhirter says Chinese demand is currently strong and prices have doubled since the post-pandemic period.
He acknowledged that the cost gap between wool and synthetic flooring — estimated at $2000 to $4500 to carpet a home — remains a major barrier. Efforts to improve supply-chain efficiency have reduced the difference in some markets to around $1000, with a long-term target of $500–$700, still preserving wool’s premium status.
“It should be more expensive because it’s better,” McWhirter said.
He added that the strong wool sector is paying the price for failing to promote the fibre for more than two decades — a legacy challenge the industry must now address as synthetics continue gaining ground.
