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    Organic Cotton


    International Trade Forum - Issue 1-2/2008 

    ©Simon Rawles Mali cotton grower

    Demand for organic cotton in the textile industry is outstripping supply, presenting clear opportunities for developing exporters. But why aren't more producers going organic? ITC looks at the obstacles and ways to get over them

    Just as consumers increasingly link their health with what they eat, many are questioning how what they wear impacts on the environment. And one of the big winners is the organic cotton industry.

    Alerted by sustained environmental campaigns, conscientious consumers are learning that cotton is just about the most chemical-intensive crop on the planet, accounting for just 2.5% of farmland worldwide, yet contributing 25% to all fertiliser use and 10% of chemical pesticides (which are also a major source of illness for agricultural workers). Furthermore, the production of cotton consumes huge quantities of water, and often in places that can least afford it. It costs more to produce organic cotton but more and more consumers are prepared topay extra to reduce the environmental impact. While eco-friendly clothing is not the new fashion standard, growing consumer interest is boosting growth in the organic cotton industry by a rate of 50% each year.

    Organic cotton producers can't keep up with demand yet many exporters see risks in making the conversion to organic. Consumers, buyers, national governments and industry associations all have their role to play in helping organic cotton reach more retail shelves. To help developing-country exporters make informed choices, ITC has published a comprehensive report on the industry.

    Demand Outstrips Supply

    The first certified organic cotton was produced in the early 1990s in Turkey and the United States. By 2006, 22 countries produ-ced organic cotton and world trade reached 23,000 tonnes - four times more than in 2001. Today, around 20 companies use more than 100 tonnes of organic cotton fibre per year, and two-thirds of them only started selling organic cotton textiles and clothing after 2002. Major retailers of organic cotton products include well-known brands like Wal-mart, Nike and Coop Switzerland. Organic fibre traded on the international cotton market still represents only 0.09% of the 24.8 million tonnes traded worldwide, according to the ITC report, but demand is outstripping supply and is likely to continue to do so in the near future. There is an obvious opportunity here for organic cotton producers in developing countries, so what's stopping them?


    The first significant obstacle to a developing-country exporter breaking into this small club is, well, just that: breaking into a small club. More than half the global production is in the hands of two companies - one in Turkey and another in India. And some 25 large brands and retailers take up 50-60% of the total. Despite the growing market, there also appears to be mixed messages from companies. While many adopt organic cotton, citing their commitment to corporate social responsibility, their communication to consumers is often limited. And some brands and retailers do not want their products to be associated with organics at all - instead marketing their products on image, design, colour, fit or price. There are also mixed messages from consumers. For example, the cotton specialist of British retailer Marks & Spencer observes, 'Our customers are just more interested in fair trade than organic.' In this case, farmers are more likely to explore fair trade certification options, rather than organic ones.

    The conversion costs for farmers are another significant burden. A few years ago, organic cotton could easily be added as a rotational crop but, today, it takes three years for conversion before the crop can be sold as organic. The costs of inspection and certification add to the bill, while production is generally more labour intensive and yields may be lower than in conventional production.


    ITC has been looking at ways policy-makers and trade support institutions can help build organic cotton capacity in developing countries, and help cotton growers access this growing market. First and foremost, public and private bodies could make it easier for farmers to convert to organics through better access to information about organic farming, including extension and marketing support. Financing schemes should be made available for the costs of control and certification, and low-interest funds for investment in organics should be created. Processors should be encouraged to adopt cotton-blending programmes. Blending yarns (with usually about 5% organic) has been little rewarded by brands and retailers but as the ITC study observes, 'blending programmes are a useful tool to introduce spinning and textile mills to the world of organic cotton, and may be considered a stepping stone towards the production of 100% organic cotton items'. The organic cotton sector should consider such movements as allies rather than competitors.

    There also needs to be more targeted information for cotton ginners and exporters to invest in organic agriculture. Mainstream cotton researchers haven't focused on organics so ginners and exporters have to rely on external sources for information in the short term.

    Further streamlining and ratifying certification is necessary. The textile industry needs a common approach in the niche market of organics to create awareness among, and reassurance to, consumers. Global Organic Textile Standards (GOTS), developed by several certifiers, has committed to implementing uniform standards, which the ITC report sees as 'an important step towards harmonization and transparency of textile labels'. Adopting GOTS in the industry could be a first step to binding rules for ecological and social processing of textiles and clothing. But the textile and clothing industry and governmental bodies may need to revise and develop these standards to help them make it into legislation.

    For more information see:
    Cotton Exporter's Guide, available at:
    www.intracen.org/eshopITC's Organic Link website at:www.intracen.org/organics

        ITC recommendations for building capacity in organic cotton
    1. Provide information and financing to producers in the process of switching to organic
    2. Encourage blending programmes as a stepping stone towards 100% organic
    3. Target cotton ginners and exporters in developing countries with specific information on organic cotton
    4. Streamline and ratify certification