May 16, 2021

How to deal with the shortage of organic cotton?

4 min read

The pandemic has caused hard consequences at different levels of the value chain. Among others, vertical denim fabric Pakistan-based mill Neela By Sapphire Fibres expects a cotton shortage to happen soon. Therefore it has started looking for alternative fiber sourcing methods that might help solve the problem. One of them is Organic Cotton in Transition. Shayan Abdullah, director at Sapphire Fibres Limited, explained.

 

In light of most recent events what might happen to the cotton supply?
In the last few years, cotton prices around the globe have been quite stable generally. However, the pandemic has kick-started an upturn in cotton prices along with other competing commodity prices such as soybeans and corn. This happens during uncertain times, when money tends to flow into less risky assets like commodities unlike other asset classes. We have also seen certain countries, including China, stockpiling soybean and cotton.

There have also been many weather-related disasters in cotton-growing countries like the United States and Pakistan. There have been hurricanes and fires in the United States and unfavorable weather conditions for cotton in Pakistan that resulted in a 50% reduction in crop size.

Shayan Abdullah, director, Sapphire Fibres Limited

Photo: Neela by Sapphire Fibres

Shayan Abdullah, director, Sapphire Fibres Limited

We predict that cotton prices aren’t going to go back down unless there is another major disruption in the industry, unforeseen by everyone.

The pandemic has also sped up the demand for sustainable fibers including organic cotton. This has led to a significant shortage of organic cotton. At the same time, there has been a major crackdown on fake organic certificates being issued in India, an occurrence that has led to a decline in organic cotton available in India, one of the largest organic cotton producers in the world. As a consequence, this shortage has provoked an increase of organic cotton prices by nearly 50%.

Also important is the fact that less than 1% of the world’s cotton crop is organic; therefore it’s a small amount whose scarcity will always create challenges.

So what alternative types of cotton or other eco-friendly fibers could be used?
The alternative to organic cotton is “Organic Cotton in Transition.” This type of organic cotton is grown during the three years it takes the farmer to convert his farm to organic.

If brands and retailers start accepting Organic Cotton in Transition, then more and more farmers will be incentivized to grow organic cotton as currently there is very little acceptability of this type of organic cotton.

We are also using other sustainable fibers like Tencel, Refibra, Modal and hemp. Many of our clients are showing particular interest in hemp, as it has inherent anti-bacterial properties, in addition it grows as an organic material as, for instance, it requires no pesticides or other chemicals.

What benefits or weaknesses could these alternative types of cotton bring?
The benefit is that farmers will take more risks growing organic cotton. There are no weaknesses to this material except that it might take a year or two for the supply side to build itself.

What price points would they be offered to?
Organic Cotton in Transition is cheaper than normal organic cotton. With the current hike in cotton and organic cotton prices, if brands and retailers accept Organic Cotton in Transition, it will lessen the burden on the demand of organic cotton and help farmers grow more organic cotton in the long run.

Neela initiative using drone technology to spray fertilizer on the crop for supporting local farmers

Photo: Neela by Sapphire Fibres

Neela initiative using drone technology to spray fertilizer on the crop for supporting local farmers

What is Neela’s experience and know-how in growing, picking and working with this cotton?
We have already started sourcing it. So we can offer our customers the option of a more sustainable alternative fiber. We are also working to raise awareness about it in our customers helping them with information and answering any queries they may have.

Could this cotton be part of any trackable value chain, blockchain and similar traceability context?
Yes. This cotton can be traced back to the gin and the farm. In the future it will be quite possible to provide complete traceability through blockchain and link all the players involved in the value chain.

Is Neela familiar with any other sustainable agricultural practice, like, for instance, regenerative agriculture?
We are familiar with regenerative agricultural practices for growing cotton. It is extremely important to focus on both the wellbeing of farmers and their community and sustainability. Fairtrade Organic Cotton, for instance, is grown according to principles similar to the ones of regenerative agriculture. This cotton also considers both social and environmental aspects behind the material.

Neela is working on two side projects that can help improve farmers’ fair conditions in Pakistan aimed at reducing costs for farmers, improving yields and the quality of their crop. One of these projects is about developing a purer cottonseed. Our second one involves drone technology used to spray fertilizer on the crop. Both projects aim to help farmers in Pakistan use less water and fertilizer and generate more income.

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