British Wool is to close four grading depots in order to maximise returns to producers as wool demand plummets due to the Covid-19 pandemic.
The Irvine depot will close along with Porthmadog, Stamford and Liskeard, which will result in the loss of 40 jobs.
British Wool, which is owned by around 40,000 sheep farmers in the UK, has calculated the move will save £1.5 million per annum – a saving of 6-7p per kg – and it says services will not be affected by the restructuring as the wool from these areas will be reallocated to other grading depots within the network.
Acting chief executive Andrew Hogley said: “Where we close a grading depot we intend to replace this with a new intermediate depot in the nearby area.
“This will ensure producers still have a local drop point for their wool with no onward haulage charges.
“We will contact all affected producers ahead of next season to let them know where the new drop-off points will be.
“We will also continue to take all types of wool from any producer. The sites we are closing are still open for producers to deliver this season’s wool and will remain so until the middle of February.”
British Wool said it had succeeded in clearing the 11 million-kilo backlog of unsold wool in store at the end of April.
However, the pandemic and the closure of the hospitality trade has put particular pressure on the contract carpet market which serves major outlets such as hotels, cruise ships and offices. The global market now faces an oversupply of cross-bred wool, mainly from New Zealand but also from other European markets.
In an appeal to farmers, Mr Hogley said: “We urge producers to stick with us and remember that British Wool is your organisation working on your behalf.
“Without British Wool, returns for wool would be permanently low and many producers would have no market for their wool.
“Rest assured, things will improve and British Wool will be working hard to support the recovery of the wool trade in order to maximise the value of your wool.”