World Cotton Day
07 October 2022
Your Excellencies, Ladies and Gentlemen, Dear Friends,
This Cotton Day is a timely opportunity to pause and reflect on this important commodity.
Cotton is a source of income for over 100 million families worldwide, many of them small farmers in rural communities in poor countries.
Over the years, UNCTAD has tried to assist these small cotton farmers, especially in Africa, where we have carried out important research projects. Just this year, we concluded a project in Togo that surveyed four hundred and 423 cotton farmers in Kara province. Some findings from this survey are very important to highlight.
For example, of the farmers we interviewed, most lived in households of 10 people, or more.
95 per cent had less than three hectares of land. And only six per cent were women.
But the importance of cotton for many developing countries extends beyond its producers and those directly or indirectly engaged in the value chain.
For example, cotton is the leading export product in Benin, with 61 per cent of total exports, and the second largest export product for both Mali and Burkina Faso, after gold. Cotton, therefore, is a key source of foreign currency in these three least developed countries, as in many other developing countries.
This is why it is so important that developing countries can reap the full benefits offered by this commodity, by addressing the challenges (both old and new) present in the cotton value chain. Allow me to quickly address some of these.
First, productivity must be increased to produce cotton at a scale that can feed the cotton industry. This requires access to credit markets, rule of law, and formal working and trading conditions.
Second, adequate, timely and affordable access to inputs like fertilizers, remains challenging in several cotton-producing developing countries, especially following the war in Ukraine, which has produced a massive fertilizer crunch.
For example, the prices of two key inputs in fertilizer production, phosphate rock and urea, increased by 130 per cent and 75.5 per cent respectively between June 2021 and June this year.
In cotton-producing countries like Mali and Burkina Faso, the authorities responded by subsidizing fertilizer sales to farmers during the planting season of 2022. However, this intervention has its limits given the financial stress facing many developing countries, which are already struggling to pay their debts.
Third, the cotton sector faces the rising challenge of climate change, especially the elevated risk of extreme weather events, in countries where farmers have very limited access to risk-mitigating measures such as insurance. This needs to be acknowledged as an issue affecting primarily poorer cotton-producing countries in order to come up with tailored response measures.
Fourth, efforts need to be devoted to fostering higher and more stable prices for cotton farmers, increasing access to post-harvest services such as transport, and investing in the production of cotton by-products, which could boost the benefits of this commodity by creating a wider industry cluster around it. On this last point, there is plenty of room for improvement. Our research shows that only one in four cotton farmers in Togo sold by-products, mostly cotton seeds.
Your Excellencies, Ladies and Gentlemen, Dear friends,
UNCTAD looks forward to continuing to support cotton value chains in developing countries, and to working alongside beneficiary countries, other development partners, and the private sector, in support of cotton-producing and exporting countries in the years ahead.
I wish you all a happy, purposeful – but above all, impactful – Cotton Day.
Thank you.
