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Wool is cool! The once reviled yarn is back

It is making appearances in shops, fashion pages, and on the catwalk. No wonder prices are soaring!

For decades, it lost out to trendier man-made rivals, but wool is enjoying a remarkable revival that is boosting the fortunes of British sheep farmers and turning the humble yarn into a catwalk must-have.

The price of wool has rocketed in the past four years as demand has soared for designer knitwear. Sheep farmers, who three years ago spent more money on shearing than they made from selling fleeces, are reaping the rewards and increasing the size of their flocks.

Graphic knits by 3.1 Phillip Lim and Jonathan Saunders, and designs by Holly Fulton and Mark Fast, are all helping wool to cast off its old-fashioned image as the scratchy fabric of childhood nightmares. Retailers are launching new ranges of woollen garments: next month Marks & Spencer will sell four lines knitted from wool sourced from the Pennines and Leicester.

Industry experts said wool was also benefiting from the same demand for sustainability that has boosted sales of locally grown food. Carolyn Massey, head of design at the knitwear firm Lyle & Scott, said: "The obsession with traceability we've seen in the food industry is also becoming a trend in clothing. People want to know the lineage of their garment. "

The volume of wool spun in British mills was up 12 per cent in 2011, compared with the previous year. And the price fetched at auction in Bradford, the centre of the UK wool industry, soared to 160p per kilo last year, up from 38p in 2008, according to the British Fleece Wool Price Indicator. Wool exports from Australia, which produces 90 per cent of all wool used globally to make clothes, have also rocketed in the past five years.

Jessica Bumpus, fashion features editor at Vogue, said a crop of new designers have made wool their "sartorial signature". "It's something that has a lot of potential," she added.

Designers started overlooking wool in favour of new synthetics in the mid-1970s. But an industry campaign led by Prince Charles to raise the yarn's profile has also helped increase demand. Speaking ahead of tomorrow's Wool Week launch, the Prince of Wales said: "Manufacturers and designers have unleashed their creativity to show just what this fibre can deliver."

The once prestigious International Woolmark Prize, won by Karl Lagerfeld and Yves Saint Laurent in 1954, was relaunched earlier this year, with Belgian knitwear designer Christian Wijnants winning.

Stuart McCullough, the Woolmark chief executive, said the support of Vogue had been a big help. "If we get models with wool on them, you get space in newspapers."

And technological advances, Ms Massey said, meant that designers could "do a lot more" with wool today. Teflon, for example, "can make wool hardier".

Phil Stocker, head of the National Sheep Association, said: "There is more optimism in the market. A lamb is now worth significantly more than a couple of years ago."