I don't want wool insulation in my home. I know they treat it with chemicals (moths, mice, etc.,) but though I don't want to encourage moths or mice, I also know just how careful I have to be around those chemicals.
Sheep are livestock, if there's no market for them, if they become financially unviable, then the farmers have little recourse but to reduce the numbers.
The original Statistical Accounts of Scotland have not just the numbers of people in every parish but also the newsy gossip from the Ministers responsible for writing them up. Some of them mention the sheep, and how the older folks wished that they'd kept some of their own animals, the ones with the finer coats rather than taking up with the new hardy breeds.
I think fewer beasts, but with better quality wool, and finding a decent market for it, might be an option.
M