British Wool has launched a major cost saving initiative in response to the pandemic and its 'significant detrimental impact' on the wool market.
The organisation has unveiled a major restructuring programme in order to reshape the business in-line with current market conditions.
Next season, the number of grading depots that is operated will reduce from 12 to 8, resulting in the closure of sites in Irvine, Porthmadog, Stamford and Liskeard.
The wool from these areas will be reallocated to other grading depots within the network, British Wool confirmed.
The annual savings from these measures are estimated to be £1.5 million per annum - equating to a saving of 6p to 7p per kg.
While the organisation said it managed to clear 11 million kg of unsold wool in April 2020, the market remained 'extremely challenging'.
According to CEO Andrew Hogley, prices were still 'severely depressed': "The global market faces an oversupply of cross-bred wool, this is mainly from New Zealand but also from other European markets.
"Although we have seen some more positive signs in recent auctions on some wool types, carpet wools remain under a great deal of pressure," he said.
"The contract carpet market which serves hotels, offices, cinemas, restaurants, airports, cruise ships, and the like, remains extremely depressed due to the closure of the hospitality trade due to the pandemic.”
While it was 'critical' that British Wool made changes to the grading network, he stressed that it would not be changing service levels to producers.
"Where we close a grading depot we intend to replace this with a new intermediate depot in the nearby area," Mr Hogley added.
"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."