Organic Cotton Market Report 2014
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TE Organic Cotton Market Report © 2015 •• 1
Organic Cotton Market Report
2014
TE Organic Cotton Market Report © 2015 •• 2
Contents
• Q&A: 60 Seconds With La Rhea Pepper - 3 • Responding To The Call – Incubating Great Ideas - 46
• A Report Which Highlights Both The Numbers And The People - 4 • Seed For Growth - 47
• A Year In Review - 5 • Moving To Organic 3.0 - 49
• Market Review - 7 • Cotton Initiatives: Working Towards The Same Goal - 50
• Supply Chain And Integrity - 19 • Take Action - 53
• Farm Review - 25 • Methodology - 54
• Assessing The Impacts - 44
• We Can Celebrate Progress – But We Have More To Do - 45
Cover: Cream Workwear
Description: Chef Jacket by Australian company Cream Workwear,
produced using 100% organic cotton and modeled with organic silver
beet grown in the backyard of Cream Workwear’s Creative Director,
Pam Burnett. There was such a large harvest that she left bundles on
neighbors’ doorsteps!
Volcom
TE Organic Cotton Market Report © 2015 •• 3
Questions
Answers & : 60 Seconds With La Rhea Pepper
Q: Good to hear the sector is starting to work more
collaboratively – if you could wave a magic wand, Q: What’s the biggest change in the organic cotton
world this year?
what would make it go faster?
After years of organic cotton being described
Three things – first we need to solve the non-GMO as “niche” we now have really big retailers
seed supply problem, and secondly we need to committing to organic cotton as a major
make sure that the business benefits reach the component of their ranges, so I think this has
farmers. There’s great work going on in both of been the year that we broke out of the niche. We
those fields, so maybe I don’t need my wand here! now need to incentivize suppliers more to keep
My third “wish” won’t necessarily speed things up up!
in the short-term but I want to see supply chains
solidifying in Africa, Latin America, Central Asia
and beyond. Over the longer term the market will
benefit from a supply base that is spread out more
Q: beyond?
And finally – what about targets for 2020 and
Q: What was the highlight of the organic cotton year
for you?
evenly.
With the commitments from the major retailers
and all the work going on to sort out our seed and
Can I have two? First, it would be progress supply chain challenges, I think we’re going to see
on business models that create the market
driven solution. Clearer market signals, greater
Q: The organic option has been around a while now.
What’s your advice to businesses wanting to go
more growth as the millennial generation brings
its buying power to the market. Organic is the best
transparency in the supply chain, fair prices for further in organic? answer to their deep concerns about ethics and
farmers – these are things we need to continue the long-term sustainability of our air, land and
My advice would be to think differently – don’t
to work on together. The new collective action water, so we’re in the right place at the right time.
launch a separate organic line, but think about
programs like the Organic Cotton Accelerator and
converting your mainstream ranges to organic
the Chetna Coalition are examples of this because
over time. And look out for business-to-business La Rhea Pepper, Managing Director,
they have such great potential to transform the
opportunities like the organic cotton uniforms Textile Exchange
industry. It’s also been great to see the Life Cycle
on our front cover this year. A number of our
Assessment and TE’s Sustainability Assessment
members are doing great business supplying
Tool putting hard data behind the organic benefits
companies which share our organic values.
we have always spoken about.
TE Organic Cotton Market Report © 2015 •• 4
A Report Which Highlights Both The Numbers And The People
By keeping these two aspects in balance we can create a better organic cotton
market. When you look at the data you will be impressed by the growth, but
when you read the people stories you’ll be inspired by the imagination and
perseverance that are the foundations of this success.
At the Textile Exchange Sustainability Conference in Portland, Oregon in November 2014, we asked a
number of leading sector initiatives to give us the inside track on how they had managed to achieve change
in their sectors.
In every case, from sustainable textile clustering in South Africa to traceable merino wool in New Zealand,
the message was the same – transformation relies on getting two processes to run in parallel and in step
with each other.
What you have to do, our experts told us, is to enable the people factors – the collaboration, the alignment,
the striving for common goals – to evolve at the same rate as the technical solutions to support the process
– the transparency platforms, the traceability mechanisms, data and analytics.
So this year’s Organic Cotton Market Report presents the technical information
– the data on supply and demand, the country analyses and our forecasts for
the future – along with the people stories, the accounts of how producers,
manufacturers and brands have worked to achieve significant results.
But like all sustainability journeys there is always further to go to reach our
destination.
Liesl Truscott, European & Farm Engagement Director,
Textile Exchange
Loomstate
TE Organic Cotton Market Report © 2015 •• 5
A Year In Review
This Year We Celebrate Growth While Being
From Retail To Farm Mindful Of The Task Ahead
Things seem to be moving in the right direction. There are
h67% 15.7bn h22% h10% 116,974 early signs of re-invigoration amongst grower communities,
more textile mills and factories are certified to the Organic
Growth In Market Value Growth In OCS Growth in Fiber
Market Value (USD) & GOTS Certified Production Produced Content Standard (OCS) or the Global Organic Textile
Facilities (mt) Standard (GOTS), and rising demand from brands and
retailers’ is leading to growth in the market share held by
organic cotton. Data from the field shows more land under
conversion to organic and at the other end of the chain our
market survey finds that retailers procurement goals are
more ambitious than ever.
However, the organic cotton supply chain faces a problem with
shortage of supply. Production is not keeping pace with the
demand for organic by the industry. This is due to a number
of reasons. Recovering from the years of decline in production
takes time. And it takes commitment and investment from all
stakeholders, particularly the brands at the end of the chain,
to pull only cotton grown with organic integrity through the
system. “You can’t push a chain, you can only pull it,” as the
h15-20% saying goes.
Estimated Growth Alongside the “catch-up” organic cotton production currently
In Production has to make, the barriers to a responsible and prosperous
2014/15 market for all continue to hinder growth. Answers are being
found; new initiatives must create a market that benefits all
and incentivizes integrity. A strong demand will require brands
bioRe, India to find innovative and long-lasting ways to secure supply.
TE Organic Cotton Market Report © 2015 •• 6
Securing Supply – It’s Everybody’s Business
ADEC, Brazil bioRe, Tanzania SEKEM,Egypt Mantis World Seasalt Coyuchi
Barriers To Growth For Smallholder Farmers: Challenges For Manufacturers, Brands And Retailers:
1 Insufficient Incentive To Go Organic
Prices, the timeliness of payment, and market access are not strong enough to offset the risk
1 Business Case
Organic cotton’s benefits are not always easy to explain to colleagues and customers.
of investment. Costs associated with organic are not always transparent and retailers feel uncertainty
about who benefits from the premiums they pay.
2 Attraction of Easier-Entry Standards
Other initiatives are “easier” than organic due to a lower entry level, available funding and
support for farmers, clarity of demand and acceptance of genetically modified (GMO) seeds.
2 Uncertainty of Integrity
Brands and others in the supply chain continue to face challenges in ensuring integrity,
traceability and equitable sharing of risk and reward throughout the chain.
3 Difficulty to Access Quality non-GMO Seed and Potential for Product Contamination
Contamination of seed and harvested cotton is a risk for organic farmers located in countries
where GMO has been adopted. However, the lack of investment in non-GMO seed suitable 3 Systems Complexity
Due to scale, chain of custody requirements and additional logistics, incorporating
for low input cultivation can be a problem affecting a number of the bigger organic cotton organic cotton into a supply chain and product line will require more complex ways of
regions. working with suppliers. This can add extra work, and extra coordination complexities, to
the “day job.”
4 Market Disconnect
If sales payments are not timely, farmers will sell organic as conventional, particularly when
faced with cash flow challenges. This loss of organic fiber to the market is not only financially 4 Weak Market
While awareness is increasing, consumer demand for organic or “sustainability” is still
painful but also discouraging for the farmer who has spent all year keeping his or her small. This can impact the pull through of organic and certainly makes it difficult to
commitment to organic production. “sell” within the business, particularly to the buying teams.
But There Are Solutions! Finding them out and making them work will accelerate the sector’s ability to build more transparent and committed supply chains – with an improved sharing of value and
business security. This report provides the groundwork for moving forward, and TE’s Organic Cotton Round Table is the sector’s platform for coming together and taking action.
TE Organic Cotton Market Report © 2015 •• 7
Market Review
15.7bn 56% 35% 42%
Use Voluntary
81% 53%
Market Value Have Specific Publicly Report Promote The Link Sustainability
(USD) Targets For On Progress Standards Label Sustainability Attributes To
Organic Cotton Against KPIs On Final Product Attributes Of Their Business
Products Benefits
Market Value Trend (USD/billion) Almost two thirds of companies (58%) are making their strategy Working With Value Chain To Secure Supply
public which encourages other brands to follow suit.
16 40%
14 Brands and retailers are communicating their product
12 sustainability attributes to consumers through their own labels
10 (49%) or via third party verification (42%). Over half of these 23%
8 companies (53%) report positive links between sustainability
16%
6 attributes and business benefits. The breakdown of these 12%
4 benefits are given below:
2
56% of companies have explicit growth targets for their use of No No Not Yet Yes
organic cotton and our data analysis reveals that 40% are now Sourcing But Currently
04/05 05/06 06/07 07/08 08/09 09/10 10/11 11/12 12/13 13/14 Issues Interested Investing
conscious of the need to work more closely with supply chains
The organic cotton market value increased by 67% this year right back to farm.
30%
bringing the estimated value to USD15.7bn.
Sustainability Benefits Resulting In Business Benefits 26%
22% 22%
57 companies participated in TE’s market survey this year (a
33% 17%
growth of 152%). The majority, 44%, are headquartered in 30% 13%
Europe, 31.5% in the USA, 14% in the UK and the remaining
(10.5%) in Canada, Japan, Australia, NZ, and South Africa. The 23%
21% Pay Forward Pre- Invest In Community Other
Premium Contract Financing Organic In Investment
breakdown of companies by category is 81% Apparel, 14% 16% Transition Programs
Homeware, and 5% Footwear. Types Of Investment To Secure Supply
Brands, of all sizes, are showing their commitment to organic 5%
cotton, encouraged by new LCA and EP&L data which proves the The chart above provides insight into the various ways brands
Increased Halo Effect Brand Positive Positive Other
sustainability benefits of the fiber. Sales Protection/ Brand/ Social are supporting farmers and securing supply.
Legal Product Media
Compliance Reviews
TE Organic Cotton Market Report © 2015 •• 8
Top 10 Users By Volume
C&A and H&M continue to lead the industry with long term
commitment to organic cotton and ambitious targets. This year
1 we see Tchibo rise up the league table demonstrating rapid
growth and a strong commitment to organic. The total amount
of organic cotton used by the top 10 brands has grown by 25%
2 since 2014, an increase of 39,950 mt of fiber (70.4 million lbs).
“
3
We continue making progress in bringing more organic
4 cotton within our collections and we are highly committed
to continued advancements. We have set a long-term plan
5 to procure our entire cotton collection from sustainable
producers by 2020 and the company is on track to reaching
6 this goal. In 2014, 46% of our cotton collection has been
made out of more sustainable cotton; close to 40% in
7 organic cotton and another 6% in REEL cotton. We’re working
to increase this further in 2015.
8 We currently receive 80 to 90% of our organic cotton supply
from India. Diversification is important to C&A and, as such,
9 we’re exploring new opportunities to source organic cotton
from suppliers in China, Pakistan and African countries such
10 as Uganda and Tanzania. For this, we are working closely
with the C&A Foundation who are supporting a number
of initiatives aimed at increasing organic production and
improving the livelihood of farmers.
“
C&A
David Millar, Head of Fabric, Yarn & Components, C&A
TE Organic Cotton Market Report © 2015 •• 9
Top 10 Users By Growth
Markets constantly transform and by examining the rate of change we can reveal
the companies which are moving the market forward. This top 10 celebrates the
“
brands which are making the biggest changes in their business with an average
1 growth of 108%. Real change is not achieved overnight – it happens
Our league table mixes sector leaders with new entrants such as Woolworths one step at a time. We realize that the only way to
2 operations in South Africa and emerging markets such as Dibella’s green hotel accomplish our goals is by changing our approach
room range of towels and bed linen. to business and we have invited our suppliers,
3 business partners, NGOs and customers to join us
on this journey.
4 Driving innovation and sustainable fiber usage
(including organic cotton, recycled polyester,
5 and certified sustainable wood) has become an
increasingly important part of our clothing and
general merchandise strategy. Overall, 8% of fiber
6
used in Woolworths clothing comes from more
sustainable fiber sources.
7
We’re the first major South African retailer to offer
a range of clothing made from organically grown
8 cotton. We continue to grow our use of organic
cotton, and in addition we have become a member
9 of the Better Cotton Initiative as a step towards
replacing our conventional cotton with a more
sustainable source.
“
10
Hugo Lemon, Textile Engineer, Woolworths
Stanley & Stella
TE Organic Cotton Market Report © 2015 •• 10
The 100% Club
“
We are proud to present The 100% Club, a new category
in this year’s market report. This Club comprises of the 16
brands (28%) which use only certified organic cotton. After many years in the fashion industry I tired
of fast fashion and was drawn to the growing
health, wellness and organic sectors. I wanted to
be part of business with a health consciousness
both for people and planet. I started researching
the market and was surprised to learn that most
holistic and organic practicing chefs wore uniforms
made from polyester blended with conventional
cotton as there aren’t other options available.
I started using organic cotton, as many years ago
I had been told of the exceptionally high rate of
conventional cotton farmers in India who commit
suicide each year due to crop failure. I was so
shocked and saddened to learn of this, and being
responsible for the purchasing of thousands of
meters of cotton fabric each month, I couldn’t be
a part of that. Since then I have been sharing this
story and educating others about organic farming
practices where ever possible. I only use organic
cotton in our range. There’s still many to share this
with and to win over, but it truly is worth it for all
of us.
“
Loomstate Pam Burnett, Creative Director, Cream WorkwearTE Organic Cotton Market Report © 2015 •• 11
Race To The Top – Top 10 Users By Organic Share
Race to the Top is another new league table in our report this year. It celebrates
those companies who are converting their ranges to organic cotton, in order of
1
percentage total cotton consumption. This category does not include companies
who use 100% organic cotton. You will find that group of companies in our
2 “100% Club”.
prAna: Removing Cost Barriers
Kathmandu Making a clear commitment to organic cotton wasn’t
3
a hard decision for prAna to take. But in order to
get there it was important to identify what barriers
4
existed that were preventing it to happen. The key
problem the design team faced was the higher
5 cost of organic fabric. So the company started a
“sustainability bank,” initially with USD10,000, to
6 fund the transition. By removing the barrier of cost,
the design team could experiment with organic
7 cotton with no constraints.
The idea was so successful that the CFO expanded
8 the funds in the bank the following year. A year after
that the team said they no longer needed the bank
– their understanding of the organic cotton supply
=9
chain let them find innovative ways to incorporate
the additional costs, either through increasing the
=9 cost of the end product or working with the supply
chain. This resulted in a significant shift to organic
10 cotton products, with 27% of cotton products organic
in 2012 rising to 63% in 2014.TE Organic Cotton Market Report © 2015 •• 12
Company Benchmarking Pilot
TE Draws On The Experience Of Business In The Community
Accurate and up-to-date market information has always been essential to The Textile Exchange Benchmarking tool is modeled on the BITC CR Index. We have taken our continuously
business success. For many years, companies have been sharing information improving market survey and structured it into a new framework which allows us to benchmark companies
with TE on their organic cotton and other preferred fiber usage. This data systematically on fiber usage and supply chain management.
enables us to make an informed analysis of the state of the market and share
the results with the industry and other stakeholders.
This year, Textile Exchange draws on the vast experience, knowledge, and the About BITC And The CR Index: BITC is the Prince’s Responsible Business Network, based in
systems developed by UK Responsible Business Network, Business in the the UK. BITC members work together to tackle a wide range of issues that are essential to creating
Community (BITC), to pilot the first textile industry benchmark of preferred fiber a fairer society and a more sustainable future. In 2002, BITC launched the Corporate Responsibility
use. (CR) Index, which has since become the UK’s leading voluntary benchmark for responsible business.
The CR Index helps companies to integrate and improve CR throughout their operations by
“
providing a systematic approach to managing, measuring and reporting on their business impacts.
BITC believes that self-assessment is the starting
point for action and improvement, and our Index is Identify Identify gaps for improvement and reinforce good practice.
both a public exercise in transparency, and a robust
tool to help companies systematically measure,
manage and integrate responsible business practice. Track Track progress over time and drive continuous improvement.
I am delighted to see the concept of benchmarking
being extended to the textile industry by Textile Benchmark Benchmark against peers and leading practice.
Exchange, and I’m sure that TE members will see the
same benefits of tracking improvement, identifying
gaps, and peer learning, as BITC members do.” Engage Engage board members and raise awareness internally.
“
Maël Lagadec, Benchmarking Manager, BITC
Explore the 2015 CR Index listing and Key findingsTE Organic Cotton Market Report © 2015 •• 13
Healthy Race To The Top But There’s Not One Size That Fits All
Skunkfunk If you are reading this report you are probably interested in raising your TE research shows that companies are strengthening their work in cotton
game in organic cotton – but where do your ambitions fit in the wider sustainability. Many have ambitious growth targets for organic only, while
framework of business? As we research the sector each year, it is becoming others have a more diverse portfolio approach. These illustrative scenarios
clear to us that companies’ efforts can be grouped into three major draw on the data and information shared with TE by 57 companies.
categories. Understanding where your plans fit will help focus your efforts
– are you Organic-Centric, Sustainability-Centric, or Future-Proofing?
Organic Sustainability- Future-
Centric Centric Proofing
Organic is central to brand identity Sustainability is central to brand Sustainability is a growing concern for
identity brand identity
Vision and Mission: Sustainability is core Vision and Mission: Usually start out with a clear Vision and Mission: You may start out influenced
to what you do. understanding of your corporate responsibility by external factors such as your shareholders
or are family owned. but you are moving from risk and reputation
Preferred Materials Strategy: Tend to be
management towards identifying business
exclusively organic for cotton or aiming for Preferred Materials Strategy: Sustainability
opportunity and are redefining success.
100%. You are an early adopter of other targets are ambitious and your preferred
organic and preferred fibers/materials materials portfolios are becoming increasingly Preferred Materials Strategy: You are setting
depending upon your product offering. You diverse. ambitious targets and are rapidly diversifying your
are in the category most likely to couple preferred materials portfolio.
Drivers for Success: Your company has made
Fairtrade with organic.
philosophical as well as intellectual connections Drivers for Success: You recognize that
Drivers for Success: You know that product between the future of your business success and sustainability must now be as much a part of
design, quality and desirability is as much a the sustainability of the planet. your company’s identity as your more established
part of your success as your eco-credentials. drivers: innovation, quality, design, desirability,
and value-for-money.
The next few pages are examples of companies reflecting these approaches.TE Organic Cotton Market Report © 2015 •• 14
Veja: An Economy At The Right Scale
For the past seven years, Veja has been working with ADEC (Associação de
Desenvolvimento Educacional e Cultural) – an association of growers located in Tauá,
Northeast Brazil. This part of Brazil has vast wealth inequalities, fragile soils and a
tendency towards drought. The association grows cotton and food plants under agro-
ecology principles. For these small-scale farmers, farming development goes hand-
in-hand with environmental protection. Veja buys cotton, on Fairtrade rules, from
320 families who live from organic farming. The producers pool their harvests in the Naturaline collection by Melanie Winger
same warehouse and by working together, minimize cotton transportation costs. This
cotton is spun then woven into canvas for Veja sneakers and accessories.
Naturaline: 20 Years Organic And Fair
With ADEC, Veja has established a seamless, human-based business model that
avoids middlemen and makes sure that reasonable profits go directly to the Naturaline has been the organic cotton fashion line of Coop Switzerland for the past 20
producers themselves. In 2013, the price agreed was 65% higher than the market years. Melanie Winiger (former Miss Switzerland and current film actress and model) is
price. A Fairtrade premium is paid to the association at the end of the harvest. This part of the inspiration and influences the Naturaline collection with her own creations,
premium is usually used collectively to improve the producers’ general standard produced to the highest standards: 100% organic cotton, 100% fairly produced, 100%
of living. Between 2007 and 2009 the premium was used to pay for the official transparency in the supply chain and 100% CO2 neutral. Each garment is fully traceable
certification of the organic cotton and Fairtrade process. back to the farm.
“With my designs, everyone shall look great and feel good. This can only work if the
garments are exciting with regards to both design and color and if the quality and the
production methods are right. This is what Naturaline stands for,” explains Melanie
Winiger.
Pioneer in organic cotton for 20 years, Coop started the partnership with the Swiss
trading company Remei AG. One year later, the first organic cotton underwear lines
under the Naturaline label reached the Coop stores. Over the years, not only did the
partnership deepen but also the product offering. Remei and Coop started the bioRe
Foundation in 1997 with the aim of improving the livelihoods of the local farming
communities in India and Tanzania.
VejaTE Organic Cotton Market Report © 2015 •• 15
La Siesta: Revitalizing Organic Cotton In Latin America
La Siesta, a German family-owned company, launched its first organic cotton hammock in 2008. Today 20% of all
its cotton hammocks are made of organic cotton. They are produced in Brazil and in Colombia in accordance with
old regional handicraft customs and using organic cotton yarn imported from Turkey.
However, importing cotton seems counterintuitive considering the longstanding tradition of growing cotton
in these countries. La Siesta is, therefore, launching an organic cotton test program of its own in Colombia.
Seeding was done end of March in 4 fincas on a total of 20 ha with organic rich soils in the department of Tolima.
“
Harvesting will be in August (cotton harvesting is carried out twice a year in this climatically gifted country!) and
yarn spinning is in September. This ambitious project foresees European (EC) and US (NOP) organic certification of
the fiber and GOTS certification of the yarn. Kering offers us a tremendous amount
La Siesta is conscious that the project can only become economically sustainable if it can be scaled up. Alexander in regards to a framework, guidance,
Grisar, manager of the project and founder of both La Siesta and the initiative SOCiLA (Support Organic Cotton and expertise and we’re fortunate to
in Latin America), is confident that other brands will join La Siesta’s initiative to benefit from the strong textile have that in our corner. That said, we’re
industry in the area. Its proximity to the North American market is also a benefit, with a lead time advantage of also free to pursue programs that make
about four weeks to far east manufacturers. sense for Volcom, and work at a pace that
is appetizing to the business. Building
sustainability into an existing business
system takes time, patience, and
perseverance. It also takes commitment
from every level and angle of the
organization. We’re glad that we’re
making steady progress, but – as I’m
sure we’ll always say – there’s still a long
way to go.
La Siesta
Derek Sabori, VP of Sustainability, Volcom
“TE Organic Cotton Market Report © 2015 •• 16
Mantis World: Making A Gift Of Organic
Founded in 2000 by Prama Bhardwaj, ethical clothing company Mantis World is proving that it is possible
for commercial, large volume manufacturing to happen in an ethical and sustainable manner with care
for everyone in the supply chain. Mantis World has successfully carved out a niche for itself in the blank
imprintables sector, where they offer both organic and non-organic lines. Mantis World specializes in EILEEN FISHER: Vision 2020
offering fashion and niche designs, and it is here that they find that organic sells best.
EILEEN FISHER is known for its long-standing
Prama says there is a significantly higher demand for organic babywear, which she explains is due largely commitment to the environment, women & girls, human
to the “gifting” culture. “It is much more common that clothes are bought as gifts for babies than adults, rights and community. More recently, these values have
and, when buying gifts, customers are often more willing to spend that little bit extra for “luxury” items. evolved into a bold, new journey for the company, which
This applies particularly to organic babywear due to the associations of organic with purity and health.” we call Vision2020.
Organic cotton garments often mean a premium price, and to encourage customers to pay the extra, Vision2020, publicly launched in the company’s spring
Mantis World uses organic cotton in fashion-focused styles such as the M96 Women’s Organic Crop Top. 2015 “No Excuses” ad campaign, is the first five years of
The customer is happy to pay a premium for a luxury, fashion item and the company invests that premium EILEEN FISHER’s plan to achieve 100% sustainability. This
by using more sustainable fibers. means scrutinizing everything we do, from the field to
the factory to the landfill, and taking a hard look at what’s
often swept under the rug – toxins, carbon emissions, and
low worker pay, to name a few.
Vision2020 identifies bold environmental and social
goals - for our products and practices - in eight areas:
materials, chemistry, water, carbon, conscious business
practices, fair wages & benefits, worker voice and worker
& community happiness. We invite our customers,
business partners, suppliers and brand partners to join us
in this journey.
Mantis WorldTE Organic Cotton Market Report © 2015 •• 17
H&M: The H&M Way
H&M has set a clear goal to further increase
their usage of organic cotton. This is part of their
“
strategic target to use only sustainable cotton by
2020. Moving towards achieving the goals also
Over the next few years Seasalt will be continuing
means moving towards full traceability of cotton
its use of organic cotton, and looking to improve the
by 2020. H&M has chosen not to pass on the
sustainability of other product areas, such as waterproof
higher cost of their organic cotton supply to their
clothing and footwear. As we continue to grow, customers; they consider it an investment in their
sustainability across everything we do becomes more customer offering and their long term success.
important.
“
H&M invests a lot in organic cotton and hope
Neil Chadwick, Seasalt Ltd
that a clearly growing demand in the market will
continue to motivate producers to increase the
supply and that they, together with all concerned
players, can tackle the current challenges in the
Esquel: PYE Off To A Flying Start
market.
Esquel Group is one of the world’s leading producers of premium
H&M is also one of the founders of BCI. BCI is a
cotton shirts. Esquel is vertically integrated, with production
complementing, and not competing, standard for
beginning in Xinjiang province in northwestern China, where
producing more sustainable cotton. In addition
the Group grows its own Extra Long Staple (ELS) cotton and
to these two complementary concepts to improve
organic cotton. It continues through spinning, weaving, dyeing,
cotton cultivation, there is a third: recycled
manufacturing, trims and packaging, and retailing.
cotton. With increases in these three options to
In 2013, PYE, Esquel’s premium shirting brand, was selected conventional cotton, H&M is convinced it will meet
by Cathay Pacific to create their new First Class Sleep Suit. “It’s its target to only use more sustainable cotton by
fantastic that Cathay Pacific wanted to share our sustainable 2020. They explain it as a clear win-win situation
message through the selection of 100% organic cotton, and I for all – lower environmental impacts, better
think the styling of the sleep suit is both chic and subtle – a real livelihoods for farmers and their communities and
take on the contemporary Chinese spirit” said Dee Poon, Chief a sustained material supply that meets customers’
Brand Officer of PYE. demands in every regard.
H&MTE Organic Cotton Market Report © 2015 •• 18
“ For 40 years, VAUDE has stood for high quality outdoor clothing and equipment for mountain
sports and cycling. We are focusing on organic cotton which fits perfectly with our deep respect
for nature and focus on protecting the environment.
“
Lara Delle, Materials Manager, Vaude
Lindex: Pushing Towards 80%
Lindex is one of Europe’s leading fashion chains, with more than 490 stores in 18 markets. Their business concept
is to offer inspiring and affordable fashion. Lindex is constantly working to improve their processes and make a
sustainable difference in the fashion industry. In 2014, they made 16.3 million garments in sustainable materials,
which accounted for 22% of their total collections. Their goal is that at least 80% of Lindex garments will be made
of more sustainable fibers and that all cotton will come from sustainable sources by 2020.
“We are working steadily ahead towards our sustainability targets and our aim is that all garments are produced
using more sustainable processes with less energy, water and chemicals and producing less waste,” says Ingvar
Larsson, CEO, Lindex.
Kathmandu: A Portfolio Approach
Kathmandu aims to have a balanced portfolio of three cotton sustainability programs – Organic, Fairtrade, and
BCI - within its product mix, with the end objective of completely phasing out conventional cotton by 2020. The
mix of differing approaches within the portfolio gives us the opportunity to tailor our cotton supply according to
our needs. This can include, on one hand, a product range made from Organic and/or Fairtrade cotton targeted
at highly responsible consumers, willing to pay a somewhat higher price, and, on the other hand, assuming
responsibility for bulk cotton production via the Better Cotton Initiative. Thus, Kathmandu can improve the social
and environmental performance of their cotton material flow and can still meet the various demands of our
customers and expectations of society.
LindexTE Organic Cotton Market Report © 2015 •• 19
Supply Chain And Integrity
h26% h18% 73%
Increase In OCS Increase In GOTS Use Voluntary Kontrolliert biologischer Baumwollanbau
Certified Units Certified Units Standards In Für Sie. Für die Umwelt.
Supply Chain Für ein rundum gutes
Gefühl.
Brand Commitment To Certification
73% of the companies taking part in the market survey report that they are using voluntary Mit Bio-Baumwolle
Tchibo
standards to verify their organic cotton. Tchibo, as an example is given on the right.
64% of respondents reported GOTS as the most commonly used standard with a significant
proportion using both GOTS and OCS. A number of respondents also reported the use of Tchibo: Holistic Messaging On Organic
combined organic and Fairtrade certification.
Tchibo is unique in its approach to sales, with a product range that changes weekly.
86% 86% Increasingly, they are incorporating organic cotton lines into the mix, and discovering new
64% and impactful ways to bring the organic cotton message to consumers who know they only
70%
have a week to snap up the latest range. Innovative shop displays, high-visibility labeling
54% and video are just three of the ways that consumers are persuaded to buy organic.
38% ‘Ribbons’ in Tchibo’s labeling aid consumers in quickly identifying products certified to OCS,
34%
FSC, CmiA and so on, and striking product displays increase sales of these sustainable lines.
Tchibo has also created a catchy and informative short video on their use of organic cotton
16%
called ‘Mr Bohne’, and have produced an ad campaign focused entirely on their organic
OCS GOTS OCS & Organic Sewing Fabric Yarn Fiber underwear range.
GOTS & FT Factory Mill Mill Source
As a result of this dedicated approach, the German based company is well on its way to
Brands Using Voluntary Brands That Carry Out reaching its goal of 100% sustainability. In 2014, 75% of its cotton came from sustainable
Standards To Verify Source of Supply Chain Mapping
Organic Cotton sources of which 70% was organic, certified to either OCS 100 or OCS Blended. And it’s
not just cotton, Tchibo is moving ahead in other organic products, especially in coffee - so
In addition to using standards to verify the source of their organic fiber, companies are also
mapping their supply chains. Just over half are able to trace their organic cotton back to the
customers see a holistic organic message as they shop at Tchibo.
fiber source for one or more of their supply chains.TE Organic Cotton Market Report © 2015 •• 20
Top 10 Certification Tips (For Buyers)
1. Read the standard and understand the requirements.
2. Research the organic regulations in the production country as well as the country of sales when claiming and
ETKO is an independent, international private selling as certified organic textile. Ensure the sustainability claim and labeling adheres to the national and
organization performing inspections and certification international regulations when claiming organic.
activities for sustainable production methods since 3. Determine how you would like to communicate the organic claim to your customers.
1996. ETKO’s mission is to promote the proper
4. When a company is selling certified organic textiles business-to-business (B2B) and makes use of the standard
designation of products which have been cultivated
logo in their product packaging or communication then the company must be certified as well (not only their
according to sustainable production methods by means
supply chain).
of supervising, testing, inspecting, assessing and
certifying. 5. Request a Scope Certificate before placing an organic order to ensure the supplier is capable and certified to
produce and supply certified organic material and/or products according to your requirements.
ETKO is an international organization with headquarters
in Turkey, and local offices and representatives in 6. Request a Transaction Certificate to be issued as soon as the shipment has been made by the supplier. Within
Pakistan, India, Bangladesh, Lebanon, Serbia, Romania, Control Union, Transaction Certificates are issued within maximum 5 working days providing the applicant
Korea, and Ukraine. They have representatives and (supplier) submits with complete documentation and underlying supporting evidence.
trained local inspectors in each country.
7. Only when each individual value chain partner holds a Transaction Certificate will the brand/retailer be able to
ETKO accredited for the following scopes: ISO 17065: obtain a Garment Transaction Certificate. Holding a Garment Transaction Certificate is a verified assurance on
TURKAK www.turkak.org.tr • IOAS International Organic the organic content and integrity within the final product.
Accreditation Services www.ioas.org • NOP by USDA
8. Certification bodies have a confidentiality agreement in place with suppliers. However public information such
www.ams.usda.gov • GOTS Global Organic Textile
as the certification status of the supplier can be shared.
Standards www.global-standard.org • Organic Content
Standard www.textileexchange.org • COSMOS Organic 9. Always verify with the respective certification body (of the supplier) should there be any doubt on the
Cosmetic Standards www.cosmos-standard.org • authenticity of the certificates.
GLOBALGAP www.globalgap.org 10. Standard owners (such as Textile Exchange) and Certification Bodies (such as Control Union) publish overviews
For information please contact to ETKO Headquarters: of existing organic certified suppliers.
160 Sok 13/3 35040 Bornova – Izmir - TURKEY Top Tips prepared by Veronique Tjon and Mahesh Nabadawewa, Control Union
T: +90-232-3397606 F: +90-232-3397607
www.etko.org info@etko.orgTE Organic Cotton Market Report © 2015 •• 21
Voluntary Organic Supply Chain Standards
Top 10 Countries OCS & GOTS
Growth Rate of Top 10 Countries
128
74 OCS GOTS
442 1 India : h20% India : h33%
293 147 215
156 2 Bangladesh : h41% Turkey : h5%
44 313 3 China : h33% Germany :h12%
480
4 Turkey : h1% China : h9%
72
5 South Korea : h10% Bangladesh : h89%
Germany 6 Japan : h58% Pakistan : h13%
7 Pakistan : h52% Italy : h9%
Portugal Turkey
Japan 8 Hong Kong : h1% South Korea : i10%
China Sth Korea
Italy 9 Sri Lanka : h95% Portugal : h5%
Pakistan
India Bangladesh 10 Germany : h69% Japan i6%
Hong Kong
Sri Lanka h18%
3,663
h26% (2014)
Others 3,170 3,085
564 (2014)
82 (2013)
2,516
215 (2013)
189
87
635
873
126
219
112 OCS GOTS
GOTS has certification units in 64 countries & 1367
ANIC 1
RG
OCS in 45 countries
00
O
con
rd
en
da
t stan
tTE Organic Cotton Market Report © 2015 •• 22
“ We continue to see increased commitment among companies to verify and certify their
supply chains. The numbers for both OCS and GOTS demonstrate this. There is still work to
be done in this area, and we look forward to seeing change continue to accelerate across
“
the organic value chain.
Anne Gillespie, Director of Industry Integrity, Textile Exchange
Soil Association Grows Organically
Soil Association Certification, the UK’s leading certifier of organic products to Global Organic Textiles Standards (GOTS),
saw licensee numbers increase by 29% (to 94) in 2014. Innovative brands are expanding fast; particularly in the baby,
childrenswear and womenswear sectors, with brands such as Frugi and People Tree showing strong growth. Homeware items,
such as blankets and cushions and the personal care sector, which includes organic cotton wool, tampons and cotton buds are
also small but growing markets, the latter bolstered by new GOTS standards for personal care products in 2014.
Globally, the number of GOTS accredited textiles facilities is increasing and the hope is that textile growth rates will catch up
with those of the food sector as the benefits of organic cotton become better known.
SEKEM: Toys And Kids Wear From Mothers To Mothers
NatureTex is a company of the SEKEM initiative that is committed to sustainable and holistic development in Egypt. The
company noticed that a lot of female employees who were processing organic cotton left their jobs once they got married.
To counteract this, NatureTex started a project that aims to empower women for a balanced society. Some motivated female
workers became inspired to organize initiatives to strengthen women, both at work and in societal life. Besides ‘’awareness
raising’’ sessions, the team arranged workshops for additional skills, outreach activities and meetings with a gynecologist.
These projects are offered during working hours and already have a positive outcome – the number of mothers dropping
their children at SEKEM’s nursery while continuing to work is increasing. In this way, SEKEM is trying to build NatureTex as a
company where the mothers of Egypt are able to produce for the mothers of the world.
SEKEM, EgyptTE Organic Cotton Market Report © 2015 •• 23
Organic Cotton Farm And Textile Standards
Certification Update
Growth In Voluntary Standards: Both GOTS and the OCS experienced
a healthy growth in number of certified facilities over the year. The
number of GOTS certified facilities grew by more than 18%, from
3,085 facilities in 2013 to 3,663 facilities in 2014. The number of
Certification On The Farm Certification in the Supply Chain OCS certified facilities increased by 26%, from 2,516 facilities in 2013
to 3,170 in 2014.
Organic agricultural standards have been largely Voluntary supply chain standards maintain the
harmonized since the 1990s even though each identity of cotton or other materials grown on an India’s Export Policy on Organic Products: On November 18, 2014,
country will have its own standards. organic farm as they move through production and India’s Ministry of Commerce issued Public Notification No. 73(RE-
into a final product. 2013)/2009-2014 that was to go into effect on December 18, 2014.
IFOAM-Organics International (IFOAM) has
The policy stated that all “organic products” exported from India must
developed tools for assessing equivalence The Global Organic Textile Standard (GOTS) covers
be accompanied by a National Programme for Organic Production
of organic standards. These tools have been the processing, manufacturing, packaging, labeling,
(NPOP) transaction certificate. This requires that all production stages
harmonized into a single one named “Common trading and distribution of all textiles made from at
after the farm to final product be certified to Indian Standards for
Objectives and Requirements of Organic least 70% certified organic natural fibers. The final
Organic Textiles (ISOT).
Standards” (COROS). products may include, but are not limited to, fiber
products, yarns, fabrics, clothes and home textiles. Whilst the positive intentions behind this are very clear, concern was
At a global level, many countries have regulatory
Version 4.0 of the GOTS was published on 1st of raised by many, including a working group of TE members, about
requirements that are similar, and there are formal
March, 2014. the practical implications of the policy. In response to the industry
agreements covering trade in organic products
feedback, the policy, which will now be implemented on June 1,
between these countries. The Organic Content Standard (OCS) relies on
2015, will now exclude textiles.
third-party certification to verify that a final product
At the farm level, the key organic farming
contains the accurate amount of a given organically OCS Review: During 2015, Textile Exchange is reviewing and
standards are EU EC Council Regulation 834/2007
grown material. The standard applies to the full updating the Content Claim Standard (CCS) and the Organic Content
(Europe), USDA NOP (USA), India NPOP (India) and
supply chain, and supports all non-food products. It Standard (OCS). The review follows the ISEAL Standard Setting
the China Organic Standard.
does not address the use of chemicals or any social Principles and Procedures and will take into account the experience
or environmental aspects of production beyond the and feedback received since the standards were released. The review
integrity of the organic material, and references and update process includes an initial open comment period, an
national and IFOAM accepted organic farm standards. in-depth review by an International Working Group, and a final public
The OCS uses the chain of custody requirements of stakeholder review of the draft before its release.
the Content Claim Standard (CCS). For more information contact lee@textileexchange.orgTE Organic Cotton Market Report © 2015 •• 24
Creating A Strong And Responsible Value Chain
Integrity is the foundation for the sustainability efforts of the Certification to standards is one of the strongest ways to ensure
textile industry; it is essential in maintaining the trust of farmers, that your product claims are accurate and able to be verified.
processors, sellers and consumers, and in ensuring that the Producers, manufacturers and retailers that follow standards, create
targeted social and environmental benefits are actually achieved. linkages within their supply chain, and support each other through
It encompasses good intentions, strong standards, cooperation, the process are the most successful.
diligence and transparency.
A strong certification system is marked by an established policy,
goals for suppliers, support and training, and rewards for success.
Tenerita
Challenges Opportunities
Seed: Availability of good quality non-GMO seed Seed: Awareness is increasing and more R&D and
Farm continues to be a challenge – including the risk of projects are underway to address concerns – GMO testing
contamination. in the field. Ultimately seed integrity is a whole industry
issue (including the GMO seed community).
Management Systems: Creating robust and pragmatic
Internal Control Systems (ICS) that support farmer Management Systems: Well-organized and authentic
organization and integrity without creating burden. production that benefits farmers, adds value to the
product, and is rewarded by the market.
Preserving Integrity: Ensuring all organic cotton Preserving Integrity: Value-added product with identity
products are segregated, tracked, and integrity is and integrity preserved.
Factory
preserved.
Investment: Strong growth in facilities certified to
Investment: Return on investment. voluntary standards.
Transaction Certificate Management: Certifying supply Transaction Certificate Management: Telling the story
Retail chains and keeping track of Transaction Certificates. of the entire supply chain.
Product Claims: More sustainability claims and different Product Claims: Truth in labeling. Being able to tell the
labels in the marketplace leads to consumer overload. story!
Bed Bath & Beyond”s organic cotton bedding collections
by Under the CanopyTE Organic Cotton Market Report © 2015 •• 25
Farm Review
1 Production up 10% after 3 years of decline 6 China positioned to grow with the right market links
This year marks a turnaround for the organic cotton sector. Production is China also saw growth this year (19%) although farmers are not
147,971 up 10% after 3 years of decline. The boost to supply comes mainly from a confident in market linkages and will focus on other organic crops if the
Farmers
response to market demand, which is very good news since it shows the organic cotton market does not show returns for them.
market is starting to respond in an encouraging way for producers. There
is also evidence of in-conversion cotton coming on-stream. Next year, we 7 Seed shortages continue but steps are being taken
foresee continued growth and estimate this to be 15 to 20%. Seed shortages in countries dominated by genetically modified cotton:
India, Burkina Faso, China, and the USA are still a major limitation to
220,765 2 India maintains lead position and achieves 7% growth growth and a risk to integrity due to potential for contamination on the
ha Land
India continues to account for three quarters of the global supply, and farm, at the gin, or in the spinning mills.
although growth is less dramatic (at 7%) than in other countries, this
growth significantly influences the overall growth rate. 8 New Fairtrade model shows promise
Fairtrade’s new accessible trading model will be a source of inspiration
3 Peru grows 56% in response to market demand and support to the farmers, processors, and retailers of organic cotton
116,974 Strong growth in Peru (56%) is in response to the market demand for that underpin their emerging growth. In 2014, Fairtrade cotton sales
mt Fiber high quality organic cotton fiber and long-standing integration into grew by almost 30% allowing Fairtrade farmers to sell 42% of their
Peruvian textile value chains. cotton production under Fairtrade terms.
4 Production to reach 20,000 mt in Turkey over next 3 years 9 CmiA-organic harvests its first crop in Tanzania
Turkish production grew this year (12%), but it’s the projection over The new CmiA-Organic Standard offers farmers in Africa the opportunity
37,883 the next three years to more than double current supply that is most to benefit from both initiatives.
ha Land In exciting.
Conversion 10 Funders investing in new organic cotton initiatives
5 1,000 large scale organic farms planned for Senegal New and innovative investment models, collaboration and collective
A new collaboration between Mapro Systems AB and UNCAS plan to action amongst stakeholders, and new business thinking are
develop 1,000 organic farms in Senegal, with UNCAS planning an strengthening value chains.
h15-20% additional 3,500 at a later stage. Each farm will start at 100 ha and grow
a variety of crops including organic cotton.
Estimated Growth
In Production
2014/15TE Organic Cotton Market Report © 2015 •• 26
Global Organic Cotton Production And Trends
Production trends: The top five producing Global Fiber Production Trend (mt)
countries remain the same: India, China, Turkey, 250,000
Tanzania and the USA, accounting for 97% of the 200,000
total production.
150,000
Growth rates: Growth in organic cotton fiber
volumes (10%) has occurred at a greater rate than 100,000
growth of land area under organic cotton (5%).
Our analysis shows that the reason for this is the 50,000
faster growth of regions with higher average
04/05 05/06 06/07 07/08 08/09 09/10 10/11 11/12 12/13 13/14
yields, for example the Aegean in Turkey, Xinjiang
in China, Peru and Tajikistan compared to the rate
Breakdown Of Fiber Production By Countries Growth Chart 2012/13- 13/14
of growth of the smaller landholders.
No1: Tajikistan h258%
Review of yields in India: We have increased 3 No 2: Benin h86%
11
the yield estimate from 5.5 quintals per acre in 5 15 12 2
No 3: Peru h56%
2012/13 to 6 quintals per acre, based on reliable 9
1 No 4: Brazil* h55%
13
reports that this is the yield estimate taken by the 14 16 6 No 5: Uganda h54%
Certification Bodies and also based on the fact
10
7 No 6: Burkina Faso h53%
that most existing groups are improving their 8 18 4 No 7: USA h25%
yields with experience. This yield estimate of 6 19
No 8: China h19%
quintals per acre also serves as a good national 17 No 9: Turkey h12%
average. No 10: Tanzania h11%
No1: India 74.25% No 11: India h7%
Data adjustment: Farm data for Tanzania in No 12: Egypt h7%
2012/13 was adjusted retrospectively in light of a No 2: China 10.46% The top 5 organic cotton growing countries in the No 13: Kyrgyzstan h6%
double count for one of the producer groups last world produced 96.78% of the total global organic No 14: Israel 0%
No 3: Turkey 6.80% cotton fiber.
year. This adjustment creates the perception of No 15: Madagascar 0% (New)
a larger growth for Africa between 2012/13 and No 4: Tanzania 3.21% The remaining 3.22% is produced by: Burkina Faso (0.74%), i1% No 16: Senegal
Uganda (0.60%), Peru (0.49%), Egypt (0.39%), Benin
this reporting period 2013/14. Global fiber has (0.36%), Kyrgyzstan (0.23%), Tajikistan (0.15%), Mali (0.11%),
i7% No 17: Nicaragua
been adjusted from 109,826 to 106,556 mt.
No 5: USA 2.07% Nicaragua (0.05%), Israel (0.03%), Senegal (0.02%),Copyright © Free Vector Maps.com i73% No 18: Paraguay
Paraguay (0.02%), Brazil (0.01%), Madagascar (0.004%) i75% No 19: Mali
No 6-19: Others 3.22%TE Organic Cotton Market Report © 2015 •• 27
Africa
Benin
700mt Fiber Yield: ≈ 231 kg/ha
21mt
fiber
fiber 2,254 Farmers 1,834 ha Land 424 mt Fiber Fiber Length: M
Seed Cotton: ≈ USD 0.55/kg 2012/13-13/14 Growth: h86%
In-Conv Estimates for 2014/15: Decline
fiber
Burkina Faso
Fiber Yield: ≈ 203 kg/ha
Mali 6,860 Farmers 4,256 ha Land 864 mt Fiber Fiber Length: M
Senegal
Burkina Faso 2012/13-13/14 Growth: h53%
Seed Cotton: ≈ USD 0.65/kg
Benin Estimates for 2014/15: Growth
Ethiopia
Mali
Uganda
Fiber Yield: ≈ 116 kg/ha
1,978 Farmers 1,136 ha Land 132 mt Fiber Fiber Length: M
864mt
fiber Tanzania
2012/13-13/14 Growth: i75%
Seed Cotton: ≈ USD 0.57/kg Estimates for 2014/15: Growth
132mt 424mt
fiber
fiber
Madagascar Senegal
Fiber Yield: ≈ 190 kg/ha
21 mt Fiber Fiber Length: M
2012/13-13/14 Growth: i1%
Estimates for 2014/15: Undetermined
3,752mt
fiber
5mt
fiberTE Organic Cotton Market Report © 2015 •• 28
Madagascar
“
Fiber Yield: ≈ 148 kg/ha
15 Farmers 35 ha Land 5 mt Fiber Fiber Length: M Market linkages continue to be a concern for growers
2012/13-13/14 Growth: h100% (New) of organic cotton, but there are signs that the sector is
Seed Cotton: ≈ USD 0.59/kg Estimates for 2014/15: Growth
building knowledge and experience and beginning to
overcome the multiple challenges they face. It will be
Tanzania
important that investment in expansion is connected to
the market.
“
Fiber Yield: ≈ 317 kg/ha
4,179 Farmers 17,218 ha Land 3,752 mt Fiber Fiber Length: M
Dr. Silvère Tovignan, TE’s Ambassador in Africa
2012/13-13/14 Growth: h11%
Seed Cotton:≈ USD 0.43 - 0.46/kg Estimates for 2014/15: Growth
Uganda
Fiber Yield: ≈ 92 kg/ha
12,500 Farmers 7,575 ha Land 700 mt Fiber Fiber Length: M
2012/13-13/14 Growth: h54%
Estimates for 2014/15: Undetermined
Africa continues to grow cotton certified to organic and Benin (7.2%), Mali (2.2%), Senegal (0.4%) and
Fairtrade standards. In 2013/14, a total of 5,899mt of Madagascar (0.1%). Regionally, this means that East
organic cotton fiber was produced by seven countries, Africa remains the largest organic cotton producing
with Madagascar joining the six existing producers region, accounting for 76%. In total there were 27,786
(Benin, Burkina Faso, Mali, Senegal, Tanzania and farmers (16% women) active in producing organic
Uganda) having started two new projects. During the cotton on 32,054 ha of land. The average price
reporting period there were 4,600 ha of land under received by farmers for their seed cotton decreased by
conversion in Ethiopia. This conversion is believed to 12.5%. This trend is in line with the fall in conventional
have been completed this year. cotton prices.
The largest African producer of organic cotton by Overall production grew 14% this year. Next season,
far is Tanzania, accounting for 63.6% of production, an increase of between 2-16% is predicted depending
followed by Burkina Faso (14.7%), Uganda (11.9%), upon outcomes in Uganda and Senegal. OBEPAB, BeninYou can also read
