NZM has secured a $3 million contract to supply 28.5 micron wool for the carpet, which will be sold under The Merino Collection banner.
The company has supplied wool to Godfrey Hirst Carpets over the past year for production trials of the range, marketed by its Feltex Carpets brand.
Because of the success of the trials, additional wool had been contracted by Godfrey Hirst for the coming shearing season to start production runs.
While the quantity of wool involved was sensitive, it was expected to be a ''significant volume'', NZM general manager supply, logistics and innovation Mike Hargadon said.
It was fantastic to see mid micron wool being used in carpet, which was very much the traditional end for crossbred wool, and he believed the potential was ''quite huge''.
The contract value was significant, given wool from that type of sheep - a merino genetic base crossed with stronger wool bloodlines - had once been ''written off'' as not commercially viable.
''There's always been a distinction between apparel-worthy wool, such as merino, and the stronger wool used primarily in carpet-making.
''We've worked hard to develop a better understanding of how innovation can open up new commercial opportunities beyond what's considered the `traditional' use of specific types of wool,'' Mr Hargadon said.
Another example was the partnership with Danish company Glerups.
Earlier this year, the footwear firm signed a two-year deal with NZM and Landcorp to exclusively supply New Zealand strong wool for its indoor shoes.
Traditional wool category lines were ''blurring'' and that was a good thing for both manufacturers and wool growers, opening up new opportunities and markets, he said.
Godfrey Hirst New Zealand general manager Tania Pauling said the new range was an ''exciting development'' the company hoped would stem the decline in wool carpet sales.
The fibre was scoured, spun into yarn and tufted into carpet in New Zealand.
It would be launched nationwide by Feltex Carpets this month.
