It is ironic, but the organic cotton movement which has seen continuous support from the consumer has hit a roadblock with global production dipping considerably in 2011 after ten continuous years of growth. In its sixth annual Organic Cotton Market Report released in November 2012, the Textile Exchange has revealed a massive 37 per cent drop in organic cotton production in 2011, after peaking in 2010; the report predicts that it will drop again in 2012 despite a brand survey that indicated a high proportion of retailers who would actually expand their use of organic cotton.
Interestingly, demand for organic textiles has continued to rise with the Soil Association reporting a 10 per cent jump in the turnover of its licensees and a 10.4 per cent rise in the number of GOTS-certified textile mills globally. This is indeed worrying, as the contrary reports indicate a disconnect between supply and demand, and although companies say they plan to increase organic cotton options, most are not taking steps to communicate this down the supply chain to farmers.
Guaranteed subsidies or benefits from other sustainable cotton initiatives, especially coming out of a recession, are luring farmers away from planting organic on vague market signals or speculation. That coupled with several factors in India, the largest producer of organic cotton for four years running, is having the biggest effect on global organic fibre production. In the past four years, India has been the largest supplier of organic cotton with almost 70% of the world’s production. With a 35% decrease in India this past year, and another 5% drop expected this year, and a drought in the US that decreased production by 83%, other nations are, fortunately, seeing an increase in production to take up the slack.
Increasingly it has been seen that Indian farmers are finding the organic cotton option ‘unattractive’. The conversion process to organic cotton remains financially unfeasible for most farmers, despite the financial and health benefits. Certification takes three years during which time farmers experience a 20 to 30% decrease in crop yields. Moreover, they are unable to sell the organically produced crops at organic prices due to the lack of certification. In addition to lost revenue, the certification process entails additional fees which are prohibitive for many farmers.
Today the premium on organic cotton is not more than 5%, whereas a few years ago it was at least 15%, which does not compensate for the additional effort that goes into producing organic cotton. What is needed to give the farmer a reason to stick on to organic cotton is support from the buyers. And while the current top users of organic cotton include H&M, C&A, Nike and Inditex, with H&M publically setting a strategic goal to only use sustainable cotton by 2020, the support is not communicated to the farmer in terms of ‘price’.
