Slap the label "local" on food and you have a selling point. Grocery stores are putting up signs next to their locally-sourced products, complete with the name of the farm or how many miles the food travelled.
There are legally-enforced standards for organic, but not for local. This works for an ear of corn, but what about your local chocolate bar-maker or coffee bean roasting company? Their ingredients are imported, but the processing is local. Do they count? Not that I am against local chocolate or anything.
If local clothing ever gets going the way local food is, we could benefit from a public discussion and consensus on what constitutes a local product, and to what degree something is local.
I have seen Romney wool and Icelandic wool for handspinning that have never left their province or state, Shetland wool that was raised in one place and sent on a round trip of hundreds of miles for processing into roving, and Gulf Coast Native wool and mixed-breed wool that have never left the county or regional district. I've handled merino, silk, Bond wool, Scottish Black Face, Navajo Churro, and Blue Face Leicester wool that came from other provinces, other states, and other countries. I have seen fiber whose origins are a complete mystery as well as angora fiber raised in someone's suburban back yard traceable to the actual animal of origin.
You'd think the Bond wool I saw would have been from Australia, but it was raised in the U.S.A., as was the Shetland, which came from purebred stock originating on the U.K.'s Shetland islands. The bit of Scottish Black Face was truly from Scotland, and I can't remember if the Navajo Churro came from the U.S.'s Southwest or not.
Anyway, wherever fiber comes from, it allows a particular degree of transparency for the way it was raised, a level of carbon footprint, a connection to the producer, and a boost to the local economy or to the barter economy or gift economy. I think it would be valuable for those qualities to be reflected when we talk about local fiber, which usually lends itself to all of these.
Another positive point about local products is that they can become distinctive and representative of a locality. There are many regional food examples in Peter Mayle's book French Lessons: Adventures with Knife, Fork, and Corkscrew. Once a local specialty is established as valuable, profiteers are going to try to adulterate the product or try to pass off inauthentic copies. So, a definition of local is needed.