Sheep farmers will be smiling - over confirmation new state houses must have Kiwi wool carpets - under changes to Kainga Ora's supply agreements

Public entities will also be required to use woollen fibres where appropriate.

Federated Farmers President, Wayne Langford, says wool is the most carbon efficient product.

He says this requirement is critical to re-booting the industry, and it's fantastic the Government's getting behind farmers.

He says they will be successful if the Government continues to support them as it is now.