Market evolution: Carded or combed wool (CN 5105) — 2015–2025

Introduction

This report examines the evolution of EU external trade in customs heading 5105 — covering wool and fine or coarse animal hair that has been carded or combed, including combed wool in fragments. The analysis draws on annual trade data spanning 2015 to 2025, as reported by the EU to the rest of the world. Over this period, the European Union's wool processing sector has undergone a profound structural transformation: a dramatic contraction in domestic production, growing reliance on imported raw and semi-processed fibre, and a notable geographic reorientation of both supply and demand. The general overview of CN 5105 trade reveals an industry in transition, where volumes are declining while prices and strategic dependencies are rising.

1. Declining volumes, rising prices: a market squeezing from both sides

EU imports fell sharply in volume but not proportionally in value

Between 2015 and 2025, EU imports of CN 5105 products declined from 41,868 tonnes to 30,590 tonnes — a drop of 26.9%. Yet import value fell by only 18.4% over the same period, from €445.5 million to €363.7 million. This divergence is explained by a sustained increase in the average import price, which rose from €10,642 per tonne to €11,889 per tonne (+11.7%). The implication is clear: the EU is importing less wool fibre, but is paying more per unit for what it does import. This pattern is consistent with a shift toward higher-value sub-segments — notably fine animal hair and cashmere — and with global supply tightening.

EU exports declined across all three dimensions

EU exports of CN 5105 products tell a more uniformly negative story. Export volumes fell from 7,174 tonnes to 6,012 tonnes (−16.2%), export value dropped from €59.4 million to €46.4 million (−21.9%), and the average export price also declined from €8,285/t to €7,716/t (−6.9%). Unlike imports, EU exports have been losing both quantity and pricing power. This suggests that the EU's position as a re-exporter of processed wool has weakened, likely reflecting the broader contraction of upstream domestic processing capacity.

The EU trade deficit remains structurally deep

The EU has maintained a persistent and substantial trade deficit in carded/combed wool throughout the period. In 2015, the deficit stood at €386.1 million; by 2025 it had narrowed somewhat to €317.3 million (an improvement of 17.8%). However, this narrowing is largely a consequence of declining import volumes rather than any strengthening of EU export competitiveness. At its widest, the deficit reached €472.3 million (2022), a year of particularly high import prices.

The COVID-19 shock left a visible mark on 2020 trade

The year 2020 stands out as a clear anomaly. Import volumes fell to just 24,798 tonnes — the minimum of the entire period — reflecting pandemic-related disruptions to global textile supply chains. A detected price shock in EU exports to China in 2020 shows an abnormality score of 70.5 and a price shift of +141.6%, suggesting severe supply dislocations that temporarily distorted pricing. Similarly, import prices from the United Kingdom spiked by +106.8% in 2020, coinciding with the finalisation of Brexit trade arrangements.

2. A hollowing out of EU wool processing capacity

EU domestic production collapsed over the decade

Perhaps the most dramatic finding in the data is the implosion of EU production of carded or combed wool. According to PRODCOM production data, production volume fell from 126,913 tonnes in 2015 to just 19,930 tonnes in 2025 — a staggering decline of 84.3%. Production value also fell by 59.3%, from €375.8 million to €152.9 million. The unit value of domestic production thus increased substantially (from roughly €2,960/t to €7,670/t), indicating that what remains of EU production is increasingly concentrated in higher-value segments. But the headline figure — an 84% collapse in output — signals a fundamental de-industrialisation of wool processing within Europe.

The EU has become deeply dependent on external suppliers

The net import reliance ratio surged from 31.5% in 2015 to 66.7% in 2025 — more than doubling. At its peak (2020), it reached 81.6%. This metric, which measures the share of domestic consumption satisfied by net imports, confirms that the EU is now structurally dependent on external sources for the majority of its carded/combed wool supply. The trade intensity index also rose from 61.3% to 79.8%, indicating that trade flows have grown relative to the size of the domestic market.

Import concentration has increased, amplifying supply risk

The Herfindahl-Hirschman Index (HHI) for imports by value rose from 2,242 to 2,479 (+10.6%). When measured by volume, the increase was even steeper, from 1,693 to 2,295 (+35.5%). These values place the import market in the moderately-to-highly concentrated range. In practical terms, this means the EU's import supply base has become less diversified, increasing vulnerability to disruptions in key supplier countries. The specialisation analysis confirms that within the EU, only a handful of member states — Bulgaria (RSCA: 0.83), Czechia (0.69), and Italy (0.59) — display meaningful specialisation in this product category.

3. Geographic reorientation: Brexit, Latin American ascent, and shifting export flows

China remains the dominant supplier but is losing ground

China has been the EU's single largest source of imports throughout the period, accounting for €192.1 million in 2015 and €158.6 million in 2025 (−17.4%). Its share has nonetheless remained substantial. However, the trend is clearly downward, likely reflecting both rising Chinese domestic demand for wool, higher labour costs, and a broader diversification of EU textile sourcing strategies. China also exhibits the lowest coefficient of variation among major import partners at 0.16, indicating relatively stable trade flows despite the overall decline.

The United Kingdom's role collapsed after Brexit

The most dramatic shift among EU import partners involves the United Kingdom. Imports from the UK fell from €35.0 million in 2015 to just €10.1 million in 2025 — a decline of 71.0%. The timing is revealing: UK imports dropped steeply after 2020, coinciding with the end of the Brexit transition period and the imposition of customs formalities under the Trade and Cooperation Agreement. The UK's coefficient of variation of 0.43 is among the highest of major partners, reflecting this structural break. The detected price shock from the UK in 2020 (+106.8% shift) underscores the disruptive impact of this transition.

Latin American suppliers have gained prominence

Against the backdrop of declining UK and weakening Chinese supplies, Latin American wool exporters have markedly increased their share of the EU market:

Peru's growth is particularly striking, with imports nearly doubling. Argentina and Uruguay, long-established wool-producing nations with strong Merino traditions, have consolidated their positions. These three countries together now account for €134.1 million in imports, compared to €103.1 million a decade ago — a combined increase of 30.1%. This Latin American pivot is consistent with the EU's broader strategy of diversifying supply chains away from over-reliance on any single region.

EU export geography: Türkiye dominates, but new markets are emerging

On the export side, Türkiye remains the EU's primary destination, though its share declined from €23.4 million to €17.7 million (−24.5%). More noteworthy is the rapid growth of exports to several markets:

Exports to India surged by over 300%, albeit from a low base, reflecting the growth of India's textile manufacturing sector and its demand for European-processed wool. The rise in exports to Peru is intriguing, potentially reflecting re-export or triangular trade dynamics. Meanwhile, exports to Egypt fell sharply from €2.4 million to €1.0 million (−58.2%), suggesting a loss of competitiveness or market access in that destination.

Within the EU, Italy and Czechia anchor the trade structure

Among EU member states, Italy is by far the largest importer (€223.3 million in 2025) and the second-largest exporter (€9.1 million), consistent with its role as Europe's premier textile and fashion manufacturing hub. Czechia dominates EU exports (€25.8 million in 2025), reflecting its historical specialisation in wool processing. Germany's role has diminished on both sides: imports fell from €116.3 million to €88.8 million (−23.7%), and exports collapsed from €8.4 million to €2.9 million (−65.9%). Bulgaria presents a paradox: its imports fell by 67.8% while its exports surged by 227.5%, suggesting a shift from importing raw material for domestic processing to re-exporting processed or reclassified products.

Conclusion

The EU market for carded or combed wool (CN 5105) has undergone a decade of structural decline and reorientation. Domestic production has collapsed by over 80%, forcing the EU into a position of deep and growing import dependence — net import reliance has more than doubled to 67%. Import volumes have fallen by 27%, but rising unit prices — driven in part by a shift toward higher-value segments like fine animal hair and cashmere — have partially cushioned the value decline. The geographic map of supply has shifted meaningfully: the United Kingdom's share has cratered post-Brexit, while Latin American exporters (Argentina, Uruguay, Peru) have stepped in to fill the gap alongside a still-dominant but gradually retreating China. Export competitiveness has weakened, with the EU losing ground in both volume and pricing terms. Looking ahead, the combination of shrinking domestic capacity, rising import concentration, and volatile supply chains — as illustrated by the 2020 pandemic shock — points to an industry that will need to grapple with significant strategic challenges regarding resilience and sourcing diversification.