BUSINESS MODEL TASK FORCE
Success for organic cotton depends upon re-imagining and re-engineering supply chains to improve business security for growers and for organic to scale up. Incubating new ways of working, driving best practice, and ensuring product integrity is integral to improved business models and the resilience of the sector.
Increase supply to match demand.
Many brands and retailers have commitments to sourcing organic cotton, and some have expansion strategies that will be difficult to achieve if we do not act now to stabilise the sector.
There is also a growing recognition that organic cotton will be a high-scoring fiber in ranking initiatives such as the Outdoor Industry Association’s Eco-Index, the Sustainable Apparel Coalition’s Sustainable Apparel Index, and that organic agriculture contributes favourably to the goals of the Greenpeace Detox campaign.
How Does OCRT Help?
The ultimate goal of the Round Table is to link the demand predictions to the production of organic cotton. This will rebuild confidence in the organic cotton sector; so that all stakeholders, including society, and the environment benefit.
Build a future for organic cotton alongside the new sustainability initiatives
It is now clear that there is a move by some organic cotton producers, brands, and processors towards the new ‘easier entry’ sustainability initiatives, such as the Better Cotton Initiative. TE recognises and respects the role these initiatives can play in addressing mainstream production, but at the same time we do not want to see the investment result in a decline in organic (and Fairtrade) cotton; which are the longer established and arguably more sustainable production systems, offering proven benefits to rural communities and the environment.
How Does OCRT Help?
By recognising the role and relevance of each sustainability initiative and that there does not need to be an ‘either/or’ approach, Round Table brands and retailers (and to some extent producers) can build diverse cotton strategies, and encourage others to do the same rather than moving away from organic.
Improve business models.
While the ‘right’ price of organic cotton has always been difficult to define, there has generally been an expectation that a ‘premium’ would be paid to the farmer. Until recently this premium has incentivised producers, it has encouraged investment in capacity building, etc, and has reduced the risk overall at the farm gate. However, commodity prices for conventional cotton have become more volatile and this volatility has in part been responsible for procurers and traders reducing the price differentiation between organic and conventional.
Another factor has been the suspiciously low prices on offer (particularly in India) which have also resulted in farmers leaving the organic cotton market. What we are now seeing is the result of an uncertain market advantage for organic, coupled with more reluctance by brands and retailers to pay an organic premium.
How Does OCRT Help?
If we are to improve the viability of the organic cotton sector we need to re-think the financial / business model and collaboratively build a more responsible approach to trade, which recognises the value-add of organic and incentivises production.
Note: ‘Easier entry cotton sustainability initiatives’ such as the Better Cotton Initiative are designed to address sustainability issues associated with mainstream cotton production and rapidly increase the volume of a ‘more sustainable cotton’ for market. Whilst aspects of conventional agriculture remain, farmers are required to reduce the use of water, fertilizers, and pesticides (selected from a restricted list), and abide by ILO labour standards. Note: these initiatives tend to be GMO neutral. It is too early to tell how widespread the positive impact is yet on the environment, improved livelihoods, and community development.
Activities To Date
Year 1 Incubation of the Organic Cotton Accelerator (OCA)
The OCA was conceived during the 2013 OCRT Business Models Task Force meeting in Istanbul.
The OCA is a multi-stakeholder initiative that aims to ‘Build a prosperous organic cotton market that benefits all, from farmer to consumer’.
Collateral for Year 1 includes: branding, microsite, Case For Organic (research paper).
Click on the image to the left to open the illustrated summary of OCA’s launch at the 2014 Textile Sustainability Conference in Portland (illustration by Carlotta Cataldi).
You can learn more about OCA on their website here.
Year 1 proof of concept for Organic Cotton Communities (OCC) – Chetna Coalition (ChetCo)
“ChetCo” was conceived at the 2013 OCRT meeting in Istanbul. It is a collaborative sustainable business initiative between Chetna Organic and an extensive value chain community of brands and facilities.
ChetCo is a proof of concept project for scalable frameworks that provide support and partnership with best-practice organic cotton farming communities.
ChetCo now represents 14 clothing and textile brands and 4 manufactures, across 9 nations and 4 tiers of production: Armstrong Spinning Mills, Armstrong Knitting Mills, ATC, Coyuchi, Dibella, Koyuchi, Kowa, Loomstate, Mandala, PACT, Pants to Poverty, prAna, ProLana, Rajlakshmi Cotton Mills, Skunk Funk, Stanley & Stella, Under the Canopy, and “99 percent”.
Organic Cotton Sustainability Assessment Tool (OC-SAT)
The OC-SAT is the result of an in-depth survey aimed at improving the understanding of the sustainability impact associated with organic cotton agriculture.
Phase 1 of the study covers Africa, China, India, and Turkey and was released in March 2015. A Summary Report was produced condenses the key findings
Phase 2 will add Central Asia, Latin America, and the USA to the tool.