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Agriculture from a Different Perspective

Cotton: The Facts

• The use of cotton has been dated to 3000 B.C. • The word cotton is derived from the Arabic

qutton or kutn, meaning the plant found in conquered lands, which refers to Alexander the Great's conquest of India.

• Cotton requires 180 frost-free days per crop. As a result, it is produced between 36 degrees south latitude and 46 degrees north latitude in tropical and subtropical climates

Huge Demand with the Industrial Revolution

• The surge in demand for cotton came from the industrial revolution, in particular from the expansion of the textile industry and the change from wool to cotton.

• Cotton achieved true "commodity" status in 1753 when Carolina cotton was listed on the London exchange.

• By 1861 cotton had become the single most important crop traded in the world, and more than 80% of it was grown in the southern United States

Largest Money-Making Non-Food Crop

• Cotton is the largest money-making non-food crop produced in the world – “White Gold”.

• Its production and processing provide some or all of the cash income of over 250 million people worldwide, and employ almost 7% of all labour in developing countries.

• Nearly all activities associated with cotton production, processing, and manufacturing are becoming more concentrated in the hands of fewer companies and fewer countries.

• Cotton textiles constitute approximately half of all textiles (Banuri 1999).

Cotton: By the Numbers

Production– Area Under Cultivation - 32.7 Million ha– Global Production - 54.6 Million MT (Seed); 19.1

Million MT (Lint)– Average Productivity - 1,670 kg of seed/ha; 584 kg

of lint/ha– Producer Price - $616 per MT– Producer Production Value - $33,644 million

Cotton: Imports/Exports

Principal Producing Countries/Blocs(by weight)China, United States, Pakistan, India, Uzbekistan, Turkey

Principal Exporting Countries/Blocs(of cotton lint)Uzbekistan, Australia, United States, China, GreecePrincipal Importing Countries/Blocs(of cotton lint)Turkey, Indonesia, Mexico, Thailand

Major Environmental Impacts

• Habitat conversion• Soil erosion and degradation• Agrochemical use (10% of all agrochemicals,

23% of all pesticides)• Water use – One of the most water intensive crops– 2.6% of world annual water usage– One t-shirt = 400 gallons of water….

The Aral Sea Catastrophe

• The complete destruction of the world’s 4th largest body of fresh water

• Diversion of two major rivers draining into sea for irrigation purposes began in 1960.

• Aral sea now only a fraction of original area/volume

Uzbekistan

• Second largest world cotton producer• Largest contributor to economic growth• Greater than 50% of agriculture mandated for cotton

productions • State procurement system that sets prices and

taxation for cotton producers• Farmers barely able to cover productions costs after

taxation• Cotton Monoculture threatens longterm

environmental sustainability of industry

Solutions?

• Organic cotton exists but does not address water and some other sustainability issues

• Better Management Practices have been identified, but reducing overall water and toxic chemical use will be difficult

• Genetic modification offers potential to reduce agrochemical use, but may cause other impacts if introduced

Better Management of Industry

• The current production of cotton is not only environmentally unsustainable, it undermines the necessary conditions for future cotton production.

• The overall goal of a conservation strategy for cotton should be to promote the sustainable production and use of cotton by minimising the impacts of overall water withdrawal as well as pollution of freshwater ecosystems from cotton production (Soth 1999).

Better Management of Industry

• Measuring the impact on freshwater ecosystems could serve as a useful evaluation for the adoption of better practices.

• For example, impacts on fresh water will be reduced if less water is taken from rivers during key times, if fewer agrochemicals are used (because of more effective targeting), and if less soil is lost from erosion.

• In order to evaluate improvements, it is important to have specific, measurable targets both for the environmental impacts of production and the percentage of cotton that is produced using improved techniques.

Organic farming & IPM

• Some of the techniques will be the application of advanced irrigation technology (drip irrigation) and the use of more ecologically sound growing methods, such as organic farming or integrated pest management (IPM).

• For farmers, the interest in sustainable cotton is direct. They stand to save water resources, maintain soil quality, maintain present and future incomes, and reduce health problems.

• It is also quite likely that they will actually save money by reducing expenditures for pesticides and other inputs.

• For the rest of the cotton market chain, there is also direct interest in sustainable cotton production. Every business that buys and uses cotton - from yarn makers to weavers, textile manufactures, and retail clothing stores - has an interest in a stable, sustainable supply of cotton.

Impediments to the implementation of sustainable production

• The issue, then, is how to promote more sustainable cotton production within the overall constraints of the current regulatory structure as well as the overall cotton market chain.

• Producers in different parts of the world do not have to comply with the same regulations and consequently have different production costs.

• Any regulatory changes in one country could put those producers at a disadvantage vis-à-vis unregulated producers in other countries.

Fair Trade

• The world price of cotton has experienced a decline in recent decades. In 2001 and 2002, cotton prices fell to US$0.91/kg, the lowest level in 30 years.

• The current conventional price is experiencing a revival, it is still equivalent to only 30% of its value in the 1980s.

• The highly subsidized cotton industry in the United States, the European Union (EU), China, and other producing countries adds further pressure to prices.

• Cotton producers in the United States receive approximately US$4.2 billion in government subsidies. This is equivalent to the value of their entire crop.

• It’s the cotton farmers in the global South who suffer the most from the low global cotton prices, as they rarely receive subsidies.

Fair Trade

• Through Fair Trade, cotton farmers receive a minimum price which covers the costs of sustainable production. They also receive a Fair Trade premium which allows them to invest in sustainable social and economic development projects, such as schools, roads or business development. Fair Trade standards in cotton ensure the following:

• Fair Trade minimum prices for organic cotton are set 20 percent higher than the Fair Trade conventional minimum prices. The Fair Trade minimum prices for cotton are set at different levels depending on the producing region.

• Producers receive a Fair Trade premium of EUR 0.05€ per kilo of Fair Trade seed cotton. This is used by the producer organizations for social and economic investments such as education and health services, processing equipment, and loans to members.

• Environmental standards restrict the use of agrochemicals and encourage sustainability.

Coffee Culture….

Coffee Culture….

Country Consumption (per capita)1. Finland12.0 kg2. Norway9.9 kg3. Iceland9.0 kg4. Denmark8.7 kg5. Netherlands8.4 kg6. Sweden8.2 kg7. Switzerland7.9 kg8. Belgium6.8 kg9. Canada6.5 kg10. Bosnia Herz.6.2 kg11. Austria6.1 kg12. Italy5.9 kg13. Slovenia5.8 kg14. Brazil5.8 kg15. Germany5.5 kg16. Greece5.5 kg17. France5.4 kg

Traditional Supply Chain

The Fair Trade Advantage

Environmental Issues…

• Similar to other agricultural crops Coffee production may include significant amount of chemical pesticides and herbicides that can have a impact on surrounding natural habitat

• Large scale coffee plantations can impact local hydrology and create a monocultural system that does not always foster sustainable management of soil resources

Shade Vs. Sun

• Traditionally coffee was grown in the shade under forest canopies

• As demand rose “sun grown” varieties were developed that had higher yields in faster growing times

• Sun grown coffee plantations typically have deforested area to accommodate larger scale production

• Countries with the highest deforestation rates often correspond to countries that produce coffee.

Rainforest Alliance

• The Rainforest Alliance uses the power of markets to arrest the major drivers of deforestation and environmental destruction: timber extraction, agricultural expansion, cattle ranching and tourism.

• Ensures millions of acres of working forests, farms, ranchlands and hotel properties are managed according to rigorous sustainability standards

• Links those businesses to conscientious consumers, who identify their goods and services through the Rainforest Alliance Certified™ seal

• Demonstrate that sustainable practices can help businesses thrive in the modern economy.