Power in West African Cotton Supply Chains
Power In West African cotton supply chains
A report by Simon Ferrigno, Daouda Traoré and Silvere Tovignan for Fair Trade Advocacy Office,
Brussels
February 2016
Power in West African Cotton Supply Chains
Table of Contents
Acronyms...................................................................................................................5
Introduction................................................................................................................7
Definitions..........................................................................................................................7
1. Power structure and problem analysis of West-African cotton sector....................9
1.1 Cotton context..............................................................................................................9
1.1.1 Structural problems........................................................................................................ 9
1.1.2 The cotton sector in West Africa: locally critical, globally little influential.........................9
1.1.3 Raw material priorities and development impacts........................................................13
1.1.4 An increasingly financialised trading context................................................................13
1.1.5 Physical infrastructure and cotton.................................................................................14
1.2 A brief history – the evolution of West African cotton sectors....................................16
1.2.1 Post colonial cotton sector organisation and reform: turmoil and crisis.........................17
1.3 What influences West African cotton producers?......................................................22
1.3.1 Producer power............................................................................................................ 25
1.3.2 UNCTAD road map.......................................................................................................26
1.3.3 National and regional policy.........................................................................................27
1.3.4 International policy.......................................................................................................27
1.3.5 Policy tools for African exports: EU and US policies.....................................................28
1.3.6 International markets and trade....................................................................................28
1.3.7 Buffer stocks................................................................................................................. 29
1.3.8 Child labour.................................................................................................................. 30
1.3.9 Subsidies...................................................................................................................... 32
1.3.10 Prices......................................................................................................................... 33
1.3.11 Cotton sector reforms.................................................................................................33
1.4 Value chain set-up and stakeholder activity in the C4 countries...............................33
1.4.1 Risk management and Smoothing funds in West and Central Africa cotton sector.......35
1.4.2 Producer participation in governance and supply chains..............................................36
1.4.3 Benin............................................................................................................................ 37
1.4.4 Burkina Faso................................................................................................................ 38
1.4.5 Chad............................................................................................................................. 40
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1.4.6 Mali.............................................................................................................................. 43
1.4.7 Senegal........................................................................................................................ 43
1.4.8 Influence map............................................................................................................... 45
1.5 The benefits and disadvantages of the governance models in the C4 and Senegal 45
2. The role of Fairtrade certification and the challenges it faces..............................48
2.1 Fairtrade in West Africa.............................................................................................48
2.1.1 Burkina Faso................................................................................................................ 49
2.1.2 Mali.............................................................................................................................. 50
2.1.3 Senegal........................................................................................................................ 51
2.2 Barriers faced by producers in marketing their Fairtrade cotton...............................51
2.2.1 AProCA perspective on Fairtrade cotton and Fairtrade-organic cotton.........................52
2.3 What governance structures support the spread of Fairtrade values and practices.53
2.3.1 Moving potential blockages..........................................................................................53
2.3.2 Best practices in West Africa........................................................................................53
2.3.3 Government policy.......................................................................................................54
2.3.4 Regional policy............................................................................................................. 55
2.3.5 International partnerships.............................................................................................55
2.3.6 Research...................................................................................................................... 55
2.3.7 Finance........................................................................................................................ 56
2.3.8 AProCA........................................................................................................................ 56
2.3.9 Producer organisations.................................................................................................56
2.3.10 Subsidies and interventionist policies in other countries.............................................56
2.3.11 UEMOA interventions in the West African Cotton sector.............................................56
2.3.12 African Union.............................................................................................................. 58
2.3.13 OHADA...................................................................................................................... 58
2.3.14 Other international initiatives................................................................................59
3. Conclusions..........................................................................................................60
4. Recommendations...............................................................................................61
4.1 Production..................................................................................................................61
4.2 Further research........................................................................................................64
4.3 The Fair Trade movement.........................................................................................66
4.4 Capacity building.......................................................................................................67
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4.5 Markets & Finance.....................................................................................................69
4.6 National governments (in West Africa and in consumer countries that purchase form
them or are potential markets).........................................................................................71
4.7 EU..............................................................................................................................75
4.8 G7..............................................................................................................................78
4.9 International Institutions.............................................................................................79
List of persons interviewed or contacted..................................................................81
References and bibliography...................................................................................81
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Acronyms
AFD: Agence Française de Développement (French Development Agency)
AIC: Association Interprofessionnelle du Coton (Cotton Inter-Professional Association)
AICB: Association Interprofessionnelle du Coton du Burkina (Burkina Faso Cotton InterProfessional Association)
AProCA: Association des Producteurs du Coton Africain (African Cotton Producers Association)
APROCOB: Association Professionnelle des Sociétés Cotonnières du Burkina (Burkina Faso
Cotton Companies Professional Association)
ARSC: Autorité de Réglementation du Secteur Coton (Cotton Sector Regulatory Authority)
ASIC: Association Interprofessionnelle du Coton (Sénégal) (Cotton Inter-Professional Association
of Senegal)
AU : African Union
BiCIA-B: Banque Internationale pour le Commerce et l'Industrie – Burkina (International Bank for
Commerce and Industry, part of the BNP-Paribas group)
CFDT : Compagnie Française de Développement des Fibres et Textiles (French Fibre and Textiles
Development Company, now Geocoton)
CIRAD: Centre de Coopération Internationale en Recherche Agronomique pour le Développement
(Centre for International Cooperation on Development focused Agricultural Research)
CMDT : Compagnie Malienne de Développement du Textile (Malian Textiles Development
Company)
Dagris: Developpement des Agro-industries du Sud (Development of Agro-Industry in the South,
now Geocoton)
FLO: Fairtrade Labelling Organisation (now Fairtrade International)
FNPC : Fédération Nationale des Producteurs du Coton (National Cotton Producers' Federation
GPC : Groupement des Producteurs du Coton (Cotton Producers' Group)
ICAC : International Cotton Advisory Committee
INERA: Institut de l'Environemment et de Recherches Agricoles (Institute for the Environment and
Agricultural Research)
ITRAD: Institut Tchadien de Recherche Agronomique pour le Developpement (Chad Institute for
Agricultural Research for Development)
MAG : Marché auto-geré (Self-managed Market)
MOBIOM: Mouvement Biologique Malien (Malian Organic Movement)
MRSC: Mission de Restructuration du Secteur Coton (Mission for Cotton Sector Reform)
OBEPAB: Organisations Beninoise Pour la Promotion de l'Agriculture Biologique (Beninese
Organisation for the Promotion of Organic Agriculture)
OHVN : Office de la Haute Vallée du Niger (Office of the High Valley of Niger)
SECO : Swiss Economic Cooperation Office
SODEFITEX : Société de Développement des Fibres et Textiles (Fibre and Textiles Development
Company)
SOFITEX : Société des Fibres et Textiles (Fibres and Textiles Company)
SONAPRA : Société Nationale pour la Promotion Agricole (National Company for Agricultural
Promotion)
TPP: Trans Pacific Partnership
TTIP : Trans-Atlantic Trade and Investment Partnership
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UEMOA: Union Économique et Monétaire Ouest Africain (West African Economic and Monetary
Union)
UNPCB: Union Nationale des Producteurs de Coton du Burkina (National Union of Burkina Faso
Cotton Producers)
UNPCT: Union Nationale des Producteurs de Coton du Tchad (National Union for Chad's Cotton
Producers)
USDA FAS: United States Department of Agriculture Foreign Advisory Service
WCA: West and Central Africa
WFTO: World Fair Trade Organisation
WTO : World Trade Organization
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Introduction
This study investigates the question of power in the cotton supply chain in five countries of
Francophone West Africa (the so-called C4: Benin, Burkina Faso, Chad and Mali, and also
Senegal). It explicitly looks at this from the perspective of cotton farmers, and their power (and that
of unions or associations who represent them) to influence, speak out, govern and change
outcomes in the cotton sector1. A secondary aim is to look at the influence these cotton producing
countries have on external forces, and at the power that in turn influences producers, from
governments, from cotton companies, the market and external institutions, regions and countries.
Who has power? Who can and does do what? What constrains them? Is anything changing? And
what can be done?
The study also looks at the role and potential of Fair Trade (and organic, and to some degree other
sustainable cottons) to redress the balance of power, given that we already know that such
programmes have positive impacts2, but need scaling up. How much can be done, and what policy
changes and support can enable this to happen are explored in the report, covering obstacles and
opportunities (see Section 2 in general, as well as Section 4 for various recommendations). We
also explore some reasons why West African governments and other bodies and institutions (e.g.,
the EU) should support more Fair Trade in cotton.
As the least industrialised cotton growing region, Francophone West Africa is in the unique position
of being almost entirely export dependant, and a price taker (unable to influence global prices).
This is largely a colonial and post-colonial legacy. Furthermore, while there are some relatively
large producing countries in the region, they are small by international standards (especially
compared to the largest 4-5 countries. See Table 1). West Africa's larger competitors benefit from
either large volumes (and well organised sectors) or by combining production and processing in
one place. These countries, and international markets determine prices, and influence. However,
while clearly in a marginal position, is the C4 and Senegalese situation improved or worsened by
domestic policies, governance and organisation? Is it a black and white situation, or rather more
grey? And what other factors such as productivity, or quality, affect producers?
This study took place in the context of a campaign on power by the Fair Trade Advocacy Office
(FTAO 2014). The report, 'Who's Got the Power? Tackling Imbalances in Agricultural Supply
Chains' looks at unfair trading practices and imbalances of power in agriculture. The present report
looks specifically at the case of cotton, and whether trade patterns in West Africa fit into one of the
four supply chain models identified in earlier work in the campaign (vertical integration, captive setups, relational networks or modular chains. See section 1.3).
Definitions
There is a multitude of terms used in discussing Fair Trade, including those that refer to certified
and traded products, and those that refer to programmes, concepts and approaches. In this
document, we are guided by the conceptual definition from the WFTO-Fairtrade International
1 Power is defined (OED) as 1. The ability to do something 2. The ability to influence people or events 3. The right or authority to do
something and 4. Political authority or control
2 For cotton specific studies, see Baseline Study of Fairtrade Cotton in West Africa by Aideenvironment (2016, forthcoming March
2016), The economic impact of sustainability standards in the cotton sector in Africa by Ferrigno S. & Monday P. 2014 GIZ: Eschborn
2014 & Fairtrade Cotton: assessing impact in Mali, Senegal, Cameroon and India (NRI) by Nelson V. and Smith S. (2011). Many other
studies have looked at the benefits of Fairtrade for other commodities as well.
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Power in West African Cotton Supply Chains
Charter of Fair Trade Principles (which recognises two complementary Fair Trade Channels),
under which Fair Trade is "... a trading partnership, based on dialogue, transparency and respect,
that seeks greater equity in international trade. It contributes to sustainable development by
offering better trading conditions to, and securing the rights of, marginalized producers and
workers – especially in the South. Fair Trade Organizations, backed by consumers, are engaged
actively in supporting producers, awareness raising and in campaigning for changes in the rules
and practice of conventional international trade."3. This definition is useful for the purposes of
examining power in supply chains.
The present report is also more focused on the Fairtrade certification system as promoted by
Fairtrade International (which is more applicable to small cotton farmers than the Fair Trade
Accreditation System by the World Fair Trade Organisation WFTO). Fairtrade International define
Fairtrade as 'an alternative approach to conventional trade based on a partnership between
producers and traders, businesses and consumers.', while WFTO define Fair Trade as '...changing
the practices in the supply chain to follow the 10 Principles of Fair Trade. To be able to deliver the
promise of Fair Trade, practices from the production to the sale of products should pass the global
Fair Trade standard set by WFTO. Fair Trade scrutiny should not only focus on the production
sphere but also on the buying behaviour of organisations.'.
In this report, when the term 'Fair Trade' is used, it refers to the first definition. When Fairtrade is
used, it refers specifically to the Fairtrade International definition, its production standards and the
products and producers certified under it. Farmers growing certified Fairtrade cotton are referred to
as Fairtrade producers, and field level projects with Fairtrade Producers as 'Fairtrade projects'.
Cotton certified under Fairtrade International standards is referred to in this report as Fairtrade
Cotton.
Sustainable cotton is used as a catch-all term to cover certified and/or verified cotton programmes
aiming to reduce the environmental and/or social problems in cotton. These are organic cotton,
Better Cotton and Cotton made in Africa as well as Fairtrade cotton. Organic cotton refers to cotton
certified under organic standards, for example under EU or US regulations.
3 See more at http://www.fairtrade-advocacy.org/about-fair-trade#sthash.H2lu8w7y.dpuf
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Power in West African Cotton Supply Chains
1. Power structure and problem analysis of West-African cotton sector
1.1 Cotton context
Cotton shows off the best and the worst of human potential – clever use of a renewable natural
resource to provide textiles (while using by-products for food (cotton seed oil), animal feed and
fertiliser (seed cake)), but serious abuses as well (trade inequalities (subsidies), human labour
abuses (forced, bonded and child labour) and environmental degradation (overuse of pesticides,
soil erosion, etc. Ferrigno 2012, FTAO 2014, PAN UK 2003)). As the FTAO report, 'Who's Got the
Power?' (2014) puts it, 'The world cotton market epitomises trade globalisation and
illustrates its inequalities: on the one hand, intensive large-scale cotton production, with high
input levels, is concentrated in a few countries where farmers are heavily subsidised...; on the
other hand, millions of small producers...are severely affected by market liberalisation...'.
Yet cotton production can – or could – deliver many livelihood benefits to small producers if some
of the barriers to their effective participation in the market were removed. Such potential benefits
include access to knowledge, finance, incomes and economic opportunities. Despite all the
problems, production in West Africa is rising (Reuters, 2015), 'as governments set high prices to
draw farmers back to a regional sector that once grew 15 percent of the world's cotton…' with the
USDA (2015) forecasting seed cotton production of 1.8 million tonnes for 2015/16, a '14 percent
increase over the previous year'.
1.1.1 Structural problems
The cotton sector in West Africa suffers from structural problems (infrastructure, investment), which
reduce its ability to compete and develop. These include poor research capacity (seed
development and breeding) and production methods and extension services, many of which reflect
years of under-investment, poorly completed reforms, and local mismanagement.
Specific problems in West Africa (where cotton is grown under rain-fed conditions) include overuse and misuse of pesticides and fertilisers (and their variable quality), erratic rainfall (with frequent
sequences of drought, excess rain, and flooding), poor seed quality, debt linked to the costs of
inputs, low productivity, intense pest pressure (further destabilised because of pesticides misuse
and overuse), forced, bonded and child labour, water pollution and the fragmentation of land as
population growth sees land divided up into smaller parcels.
The sector badly needs more (and better funded) research, extension, seed breeding and
development, and improved coordination. Production costs are a problem for farmers, due to the
costs of pesticides and fertilisers, and problems are aggravated by environmental degradation and
climate change, with farmers at the mercy of environmental and economic factors outside their
control. Research and extension also need to support more environmentally friendly farming
methods, that also reduce farmer costs and their exposure to debt (especially so for the smallest
and most resource poor farmers).
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Power in West African Cotton Supply Chains
1.1.2 The cotton sector in West Africa: locally critical, globally little influential
Cotton production data for the C4 and Senegal
800,000.00
700,000.00
600,000.00
500,000.00
Production 2014/15
Production 2015/16 (est.)
Area (2014/15) in hectares
400,000.00
300,000.00
200,000.00
100,000.00
.00
Benin Burkina Faso Chad
Mali
Senegal
Cotton production in the C4 and Senegal
Presently, West Africa produces around 10% of the world's total cotton supply, and is the second
largest export region after the USA (ICAC in WTO 2015). Within Africa, the largest producers are
Burkina Faso and Mali, but their production is dwarfed by the largest global producers, India,
China, the USA, Pakistan and Brazil, who all produce cotton in the millions of tonnes, compared to
the tens or hundreds of thousands in West Africa. Table 1 shows how African countries compare.
Burkina Faso is the 10th largest producer globally, but its 2014/15 production was just 4.3% of that
of the number 1, India.
Cotton yield averages for the C4 and Senegal 2014/15
1,200.00
1,000.00
800.00
Yield average (kg/ha, seed cotton) n/a
600.00
400.00
200.00
.00
Burkina Faso
Chad
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Mali
Senegal
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Power in West African Cotton Supply Chains
Graph: no data available for Benin
Table 1: Comparison of largest African cotton producing countries against largest global producers
Largest cotton
producers in Africa
Burkina Faso
Mali
Volume (2014/15)
Largest global
producers
Volume (2014/15)
India
6,641,000.00
China
6,532,000.00
USA
3,502,000.00
Pakistan
2,286,000.00
Brazil
1,524,000.00
Uzbekistan
871,000.00
Turkey
697,000.00
Australia
479,000.00
Turkmenistan
316,000.00
Mexico
266,000.00
Greece
261,000.00
Argentina
245,000.00
Burma
196,000.00
288,000.00
218,000.00
Cote d'Ivoire
191,000.00
Benin
131,000.00
Egypt
114,000.00
Cameroon
109,000.00
Chad
48,000.00
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Senegal
9,000.00
Total
Source: USDA FAS 2015 cotton world markets and trade March 2015
Even taken as a group, the West African producing countries, including the C4 and Senegal come
behind Brazil, in 6th place on the largest producer list. With almost all production exported, the
sector also suffers low yields, and is affected by currency volatility4, subsidies and other
international market manipulations.
Despite various programmes supporting it, there has never been much domestic processing in the
region. What there is in decline. Some artisanal production does remain, and is strong in some
countries, such as Burkina Faso, where traditional clothing is still prized. Both industrial and
artisanal sectors are however threatened by imports of second hand clothing, and cheap Chinese
imports. There are also problems in the cost and reliability of energy supply, the lack of skills, and
capacity to manage international market demands (design and marketing).
1.1.3 Raw material priorities and development impacts
The cotton sectors in West Africa are highly regulated, with competition limited by law (Delpeuch &
Vandeplas 2013). The intent of the organisational model was to ensure quality, quantity,
consistency and ready availability of cotton for international markets, and this informs thinking to
this day (with export dependency being a growing factor). The system has helped maintain smaller
producers in cotton, and given them access to cash markets. It also has some benefits for food
production. In crop rotation, crops planted after cotton can be more productive because of residual
benefits from the use of fertilisers. However, there can also be negative impacts from the over-use
of pesticides (food contamination, poisoning of people and livestock as well as water; PAN UK
2003, Glin et al. 2006).
1.1.4 An increasingly financialised trading context
Cotton trading is increasingly becoming 'financialised': cotton trading and markets are no longer
used only for risk and price management and stability (by specialist cotton traders), but also for
speculation by financial actors (Staritz et al., 2015). The newer actors are 'large institutional
investors, pension funds...Further, investment banks have increasingly offered diverse products for
commodity derivative market investments'. The traditional commodity traders are themselves
merging, or being subsumed into larger companies. One smaller player, Plexus Cotton, is leaving
global trading altogether to focus on other business interests in Africa (including some physical
trading), meaning the analysis by Staritz et al., (2015) is already out of date: 'traditional cotton
commodity traders such as Reinhart and Plexus and smaller traders more generally have
remained focused on physical trading activities'. This is bad news for small farmers, especially in a
region where the chances of being in a vertical operation are small.
Larger traders now use more financial instruments. This is having an influence on cotton pricing
(both the Liverpool Cotlook A Index and the New York Futures market, which determine prices for
4 Cotton prices are generally quoted, and trade made, in US Dollars, but Francophone West African cotton producing countries use
the CFA Franc, which is tied to the Euro, which swiftly exacerbates currency movements.
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Power in West African Cotton Supply Chains
the physical trade and futures prices). For small farmers, this means more volatility, and less
access to risk management for them and cotton companies, as 'commodity derivative markets
have become the central pricing mechanism for international cotton trade with futures prices being
increasingly transferred along the commodity chain to exporters and producers. This is particular
problematic given the increased short-termism in derivatives trading that amplifies both the size of
price swings as well as their frequency'. Farmers, producer organisations and national cotton
companies are also having more risk passed on to them (Staritz et al., 2015). It is true that the
cotton pricing mechanism in West Africa does somewhat protect producers from volatility, but
exposes cotton companies instead.
To counter this, Burkina Faso has developed a 'Fond de Lissage' (smoothing mechanism – see
Section 1.4.1). This, if proven financially sustainable should be rolled out from Burkina to other
countries in the region, perhaps as a regional programme. National cotton companies could also
'sell through fixed price forward contracts to international traders' (Staritz et al., 2015), and many
international traders recommend West African cotton companies do so (Ferrigno 2015,
unpublished). Even Sofitex, the largest cotton company in Burkina does not make use of 'futures
or options as hedging is seen as complicated and expensive and not part of their business focus
on the physical market', even though this could help manage price volatility risks. The same is true
of CMDT in Mali. Staritz et al., 2015 also suggest it is necessary to have alternative physical price
determination mechanisms, and development of 'marketing and trading capacities in producer
countries and through furthering local and regional processing'.
Table 2: cotton production in the C4 and Senegal 2013-2016
Cotton production and
prices in West Africa
2013/14
2014/15
Production
Price
Production
Price
Production
Price
Benin
307,000
265 CFA
393,000
250
500,000
260
Burkina Faso
647,000
CFA 245,
$0..39
650,000
CFA 225, $
0.36
572,000
Chad
82,000
CFA 250, $
0.39
130,000
CFA 250, $
0.39
216,000
Mali
440,000
CFA 250, $ . 547,000
40
CFA 235, $
0.38
650,000
Senegal
29,000
CFA 255, $
0.41
CFA 255, $
0.41
30,000
26,000
2015/16 (estimates)
Source: USDA FAS 2015, Reuters 2015, Interviews
1.1.5 Physical infrastructure and cotton
Among the C4 and Senegal, Burkina Faso, Chad and Mali are all landlocked. Cotton transport
depends mainly on roads, and links to major ports in neighbouring countries. Benin and Senegal
both have ports, although Cotonou at least suffers serious delays and congestion as well as
customs delays (and corruption). Burkina Faso, Mali, Senegal and Benin have some rail services5,
5 A rail connection between Niger and Benin was due for completion at the end of 2015. A coastal rail linking Benin, Burkina Faso,
Cote D'Ivoire, Ghana, Niger, Nigeria, and Togo is also planned http://www.un.org/africarenewal/magazine/december-2014/west-africanew-railway-network-aims-boost-inter-regional-trade
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which are antiquated, slow and expensive (Burkina Faso and Mali are connected by rail to Dakar
and Abidjan ports). Roads are often beset by problems (potholes, etc., caused by weather and
rain, although road haulage is still cheaper and more reliable than rail), and borders by delays (see
UNCTAD, 2007). UNCTAD (2007) point to '13 major transit corridors: seven road corridors, five rail
or rail/road corridors and one rail/water corridor' available to the landlocked countries in West and
Central Africa. Nine tenths of freight moves by road, despite their poor condition.
More positive news is recent entry or re-entry of global investors to the port sector, attracted by
new opportunities in mining, minerals and oil (Debrie 2012). However, UNCTAD (2007) point to a
number of non-physical transport problems: 'Shortcomings in terms of inadequate regional
cooperation, insufficient use of information and communications technology (ICT) due to technical
and user problems and human resources constraints cause non-physical bottlenecks that keep
transport costs unduly high. In particular, customs documents are not harmonized and bordercrossing procedures are lengthy and cumbersome despite regional agreements on the free
movement of persons and goods'. There are also problems with 'illicit financial charges' (UCTAD
2007).
Port capacity on the coasts is generally said to be sufficient for need, although problems in Cote
D'Ivoire have disrupted cotton trade in recent years. Investments are coming, but may take some
years to complete, and meanwhile, transport from West Africa remains costly, and slow, which is a
brake on potential growth.
Table 3: Main ports for cotton in West Africa
Port name and location
Transport links
Countries shipping through port
Lomé, Togo
Road
Togo, Niger
Cotonou, Benin
Road, rail (domestic only)
Benin, Burkina Faso, Niger
Dakar, Senegal*
Road, rail
Senegal, Mali, Burkina Faso,
Niger
Abidjan, Cote D'Ivoire*
Road, rail
Cote D'Ivoire, Burkina Faso, Mali
Conakry, Guinea
Road
Guinea, (other countries not
known for cotton)
Tema, Ghana*
Road, rail
Burkina Faso, Ghana
Douala, Cameroon*
Road, rail (domestic)
Chad, Cameroon
Source: From Debrie 2012 and UNCTAD 2007
* These ports are considered most important for landlocked countries
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Power in West African Cotton Supply Chains
1.2 A brief history – the evolution of West African cotton sectors
The value chain for cotton and textiles and its context1
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Power in West African Cotton Supply Chains
1.2.1 Post colonial cotton sector organisation and reform: turmoil and crisis6
Centralised commodity boards and monopoly national cotton companies were the norm in West
Africa for many years, sometimes with a strong involvement from foreign investors, especially the
French state company Compagnie Française de Développement Textile (CFDT, which became
Dagris and later Geocoton). CFDT assisted with research and marketing, with a view to ensuring
raw material supply to France's textiles industry (as it had during the colonial era). This explains
why domestic textiles industries, usually nationalised, remained of poor quality, focused on
domestic markets. The goal was volume production of a cotton lint of consistent, uniform quality for
export, meaning intensive production was the strategy chosen to ensure high yields.
Subsequent global movements towards market liberalisation, along with currency crises and
problems with production methods led to moves to reform the West African sector. These have
however exposed the West African cotton sector to more market volatility, even as larger rivals
have not reformed (USA), and continue to support their cotton sectors. Cotton sector support is
now common, with China and India, major producers, also supporting prices through government
intervention. There is however an argument that (at least some) reforms also focussed on a better
division of profits with producers, as well as competitiveness (Delpeuch & Vandeplas 2013). This is
particularly true with regards to the creation of Producer Organisations and Unions at village and
national level.
The state controlled monopoly and monopsony systems of West Africa – also know as the 'filière7'
system – have been criticised for 'depressing farm gate prices' (Delpeuch & Vandeplas 2013), and
offering unsustainable financial support to cotton producers (Baffes 2009a in Delpeuch &
Vandeplas 2013)). However, while the price setting systems go against current neo-liberal thinking,
it is understandable and even rational than West African countries want to support their cotton
sectors against the impacts of far greater subsidy elsewhere. The approach is especially valid as
the Doha round of WTO talks and C4 complaints have not yielded any results, and current
negotiations of bilateral and geographically limited agreements such as TTIP and TPP seems to be
destined to sideline LDC governments. Indeed, reform in this case could have negative outcomes
(Delpeuch & Vandeplas 2013)). It remains to be seen if the December 2015 WTO meeting will
achieve anything lasting. The Third World Network (December 2015) reports that the outcome on
export subsidies is a victory for the USA (i.e., for subsidies), while All Africa (2015) suggests there
was no progress on agriculture.
To date, the cotton sectors in the five countries remain highly regulated, with Benin and Burkina
Faso having liberalised most, with very different success. Burkina Faso is working relatively well,
but the government of Benin has taken control of the cotton sector again, following a crisis. Mali
and Chad remain almost unreformed. Senegal is such a small producer that allowing more
liberalisation would cause problems, and SODEFITEX (now a public-private company) has proven
quite efficient.
Continued state support is blamed for the persistence of intensive cropping systems and the
damage they cause (Delpeuch & Vandeplas 2013). More reform is delayed as 'differences in
6 For Benin see Section 1.4
7 There is no exact translation of the French word filiere, although it is often given as supply chain or value chain. There is a hint of
thread or connection in the word (fil), which suggests an interlinked system, perhaps with something of the vertically integrated chain
about it. It is certainly a system where there is some continuity in buying and selling.
Power in West African Cotton Supply Chains
bargaining power of producer associations, the processing sector or government stakeholders who
are either unwilling to give up on rents, or believe that reforms would not be beneficial to farmers',
according to Delpeuch & Vandeplas (2013). Reforms in East Africa for example have led to lower
farmer prices, as well as less farmer support. Given that cotton represented 50% of export
revenues for Benin and Burkina Faso in 2006, it is not surprising governments are hesitant.
However, with public budgets declining and falling yields, change is needed. It is though a
questions of whether it is change in cotton alone, or changes in both production and crop patterns
(Delpeuch & Vandeplas 2013). Diversification needs to be considered: 'Whereas governments in
WCA have historically presented cotton production promotion as one of the most efficient ways of
pulling rural populations out of poverty, they should now try to improve opportunities for
diversification, or design more efficient social safety nets that target recipients based on needs
rather than on cultivation choices'. That said, it can also be argued that improvements in the
efficiency of regulation, government management and sector organisation are also needed.
Reforms have too often been ineffective, incomplete, and political. At the same time, cotton sectors
are trying to fulfil a disparate range of goals: to drive exports and earn foreign currency, modernise
infrastructures, but also protect livelihoods and improve rural development. There are conflicting
economic and social security goals.
The next sections look in more detail at the cotton sectors in each country.
1.2.1.1 Burkina Faso
Cotton production in Burkina Faso is entirely rain-fed. It was established during the colonial era,
when the country was known as Upper Volta. Initially unsuccessful, cotton production was
relaunched in 1949 by the CFDT, to supply raw material for the French textiles industry. The
independent Burkinabé government did seek to establish textiles (Voltex SA) and oil seed
production (CITEC Huileries) in 1970. This was followed by the Société Fibres et Textiles
(SOFITEX) in 1979, with the aim of developing cotton production in suitable regions.
An industrial development strategy covering 12 sectors was launched in 1998, of which cotton was
the most important. The idea was to promote competitive industries, with cotton moving from an
export leader to an organised sector promoting national agricultural and industrial development.
Three key reforms characterise this change:
 A contract between the Government and SOFITEX on government disengagement (19921997)
 An inter-professional agreement to enhance professionalism (1998-2004)
 Creation in 2004 of three cotton companies (SOFITEX, Socoma, and Faso Coton) in the
western, eastern and central regions.
These led to the creation of the Professional Association of Burkinabé cotton companies
(APROCOB), and of the national cotton producers' association (UNPCB), which come together to
make up the Burkinabé cotton inter-professional Association (AICB). AICB is the effective seat of
sector governance (under government legislation). The year 2004 also saw a new agreement
between government, cotton companies and UNPCB governing the cotton sector, to capitalise on
achievements and improve performance and competitiveness. Running to 2012, it has been
continued and amended for 2013-2023.
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Power in West African Cotton Supply Chains
The AICB is governed by 8 representatives each from APROCOB and UNPCB in the general
assembly, and 16 directors on the Board of Directors in the same proportions. There is an 8
member executive board (4 from each member organisation), and the board is led by a president.
Other important bodies in the sector include:
- The “Association fonds de lissage” (Smoothing Fund Mechanism. This body is a legal vehicle
established in 2008 between APROCOB and UNPCB to mitigate the effects of price volatility on
producers and cotton companies. It provides stability and sector solidarity by establishing
surpluses in good years, paid out to support incomes in bad years.
- The “Burkinabé Association Fund for Cotton Inputs” is a legal vehicle created in 2012 to manage
the cotton inputs fund, and support the financing of inputs for cotton production.
The organisation of farmers, and leadership and power in Burkina Faso's cotton sector
Farmer's organisations first appeared in Burkina Faso in the 1950s, and their promotion became
more important following independence, with over 600 groups listed by 1965. The creation of
village groups on a large scale really began in 1974, backed by a government drive for community
development. According to A. Faure and D. Pesche, "the administration wants to introduce a VG
by village. These VG are most of the time the passage obliged to procure inputs and credit; they
also serve as transmission belt for the technical themes popularized by public or parastatal
company (SOFITEX) agents. Village is designed as a unit of development to which government
provides technical support" (network GAO1993).
By 1993, there were 8,535 village groups identified, of which 1,893 were in the 7 provinces making
up the western cotton area (Houet, Kénédougou, Mouhoun, Kossi, Sourou, Comoé and
Bougouriba). In the same areas, SOFITEX devolved primary marketing (sales of cotton from
farmers to the gin) to capable village groups, as a "self-managed cotton market" (MAC), including
payment of social investment grants. By the early 1990s, village groups controlled 95% of primary
marketing. These groups were also responsible for ensuring collateral security for credit to farmers
for short and medium term credits. The groups began to federate in the early 1990s, pushed by
individuals convinced that producers could play a more significant role than public authorities or
development companies assumed (S. Couret and. Traoré). Producer Groups have been able to
stand up to SOFITEX with protest and advocacy, for example in 1996/97 and 1997/98, by
boycotting pesticides purchases deemed ineffective and organising their own imports.
Village Groups in the early 1990s found it hard to manage debt collateral, and crisis occurred when
heavy pest pressure in 1991/92 led to low cotton production. Although loans were rescheduled,
and some later cancelled, SOFITEX concluded that village level collateral was not appropriate, as
villages were not always homogeneous. As a result, groups were reorganised to reflect relations of
solidarity. These groups were named Groupements des Producteurs de Coton (GPC, or cotton
producer group). Some 4,000 of these were found in cotton areas after the change, based on
location, kinship, or ethnicity in the case of migrant populations. However, problems of unpaid
debts continued, with a realisation that to function well they need support to develop their
structures and to train their officials. This conclusion was backed by SOFITEX and the French
development agency, AFD.
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Power in West African Cotton Supply Chains
1.2.1.2 Chad
Cotton was first grown in Chad in 1911, in Mayo Kebbi in western Chad (The Sudanian region also
know as 'Chad Utile', or useful Chad). Spinning was manual, but the colonial power took an
interest, and initial trials led the entry of several colonial companies. By 1928, cotton was a
compulsory crop, with the Franco-Belgian cotton company COTONCO holding a monopoly
between 1930 and 1960. The Compagnie Cotonnière Française took over from 1960 to 1970,
when the government created COTONCHAD, in which the government was the major shareholder
(75% of shares). There have been many crises, with the most recent leading to a new
COTONCHAD company being created to replace the old one in 2011. The sector is vertically
integrated, with a single cotton company managing input supply and marketing. A price stabilisation
fund was abandoned in 1993.
Cotton growing led to cereal crops being abandoned, and to soils becoming degraded; food
insecurity grew as a result. However, cotton production has continued to increase (CotonTchad
2012).
The organisation of farmers, and leadership and power in Chad's cotton sector
Cotton producers in Chad began to be organised in 1986, with the creation of groups to manage
input needs assessment and distribution. From 1988, following work by vocational agricultural
training centres, producers took over responsibility for cotton primary marketing. Supported by the
staff of the national rural development agency, they organised into Village Associations (AV). These
associations ran self-managed markets (MAG). As of 1992, there were 3,445 MAGs marketing
cotton in the Sudanian zone. Village Associations deliver seed cotton to COTONCHAD, and are
responsible for paying producers after deducting the value of inputs supplied. COTONCHAD pays
producers per tonne of seed cotton. Over a 10 year period, the 350,000 producers in the Sudanian
zone oversaw a big increase in the sector, with their participation critical to maintaining input prices
at a reasonable level. The producer groups also took responsibility for credit repayments, and
applicable collateral (caution solidaire). Collateral responsibility begins with family members,
grouped in input management groups (Groupement de Gestion des Intrants), and then the Village
Association. Collateral is called upon if any producer has repayment difficulties, or if any defaulters
are in breach of loan repayments. These may then be excluded from the group (Prosper 2014).
Sector liberalisation
Moves to liberalise the Chadian cotton sector began in 1999, instigated by the World Bank. A
technical cell was set up to investigate the potential for privatisation of the cotton sector, as well as
to develop strong producer organisations, able to fulfil a role after reforms. However, the
liberalisation process failed for two reasons: lack of will, and financial problems in the cotton
company. Sensitised farmers are generally opposed to reforms, and instead seek subsidies for
intensification, or for cotton transport and processing. Fears exist over abrupt withdrawal of the
state and other actors, and over the loss of input subsidies (which have been as high as 50%).
These have already almost disappeared, for inputs and equipment (AProCA et al., 2014).
1.2.1.3 Mali
Cotton has long been an engine of development in the south of Mali, since the colonial era (when
its production was compulsory; Campbell, in Benamou 2006). The irrigated areas of Office du
Niger were planned and constructed largely to ensure the supply of cotton to metropolitan France.
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Power in West African Cotton Supply Chains
Beginning in the 1930s, cotton began to be irrigated, but this was abandoned due to technical
difficulties in 1971 (11 years after independence). Rain-fed cotton production was also part of the
colonial system, and was further developed after the second world war, especially in the Sikasso
region.
A major step forward for the Malian cotton sector was the establishment of the Malian Textiles
Development Company (CMDT) in 1974. The company is now a semi-public company, with capital
owned 60% by the Malian government and 40% by the French company Dagris, now called
Geocoton. CMDT holds an almost complete cotton monopoly in Mali. The other actor is the Office
de la Haute Vallée du Niger (OHVN), which only controls 6% of national cotton production. After a
series of crises, CMDT recapitalised with an increase the state's share, which is now 98%.
CMDTs original mandate was to ensure “development of cotton growing areas and improvement of
farmers’ living standards in particular by cotton production development “(Saha, Barter and al.
2007). The set-up was similar to that found in other Countries in the CFA Franc zone of West
Africa, with a government controlled cotton company in charge of upstream and downstream
activities, an obligation to purchase from farmers, fixed prices for cotton and inputs, and
contractual obligations to producers (Fok, Kaur et al.. 1999; Fok 1999; Hugon 2005). Over the two
decades between 1970 and 1990, there was strong growth, with Mali at the forefront in Africa in
terms of area sown, volumes and fibre quality, as well as for producer revenues and contributions
to national income and the economy. The value of exports rose by 27% in the 1970s, 34% in the
1980s, and 30% between 1990 and 1999. It made up 46% of exports between 1989 and 1994
(Dhar and Kaur 2010).
Between 2000 and 2010, there were more crises with decreases in yield, linked to socio-economic
and technical factors, including errors in extension advice (fertiliser dosing, variety selection, etc.).
Farmers planted cotton on poorer lands, while inputs (as in other countries) were often diverted to
food crops; the area increased, however, as more farmers planted cotton, but poor knowledge
often meant low productivity.
1.2.1.4 Senegal
Senegal pioneered cotton production in Sub-Saharan Africa, which was established around 1720,
when the French brought in slaves to develop it. Although a failure, there was a renewed attempt
between 1816 and 1861, with various attempts based on both plantation agriculture and family
farming. By 1860 however, cotton had given way to a groundnut monoculture, and cotton was
eclipsed. It was revived in 1961 as the Senegalese government sought to liberate itself from
'peanut tyranny'. An irrigated cotton trial was implemented with the French cotton development
company CFDT. Rain-fed trials followed in 1964. The Senegalese cotton and textiles company,
SODEFITEX, was then established in 1974 with a public shareholding of 77.5%. CFDT held 20%
and the International Bank of West Africa (BIAO, now the West African Banking Company CBAO)
2.5%.
A change occurred in 2003, with SODEFITEX passing under the control of DAGRIS (now
GEOCOTON) with 51% of shares, and the government of Senegal retaining 46.5%. Its new
mission included a strong focus on sustainable development (and other crops than cotton; for
example, SODEFITEX bought old groundnut equipment from the failed national groundnut
company), as well as an increase in capital.
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Power in West African Cotton Supply Chains
Production in Senegal reached 50,000 tonnes in 1991/92, but has since been mostly in decline,
reaching 11,400 in 1998/99. It rose again to 52,422 tonnes in 2006/07, but has since fallen again to
only 9,000 tonnes in 2014/15. Senegal is highly responsive to global prices and demand.
SODEFITEX is however struggling to maintain services such as funding fertilisers for the 50,000
farmers it supports.
The organisation of farmers, leadership and power in Senegal's cotton sector
Farmers in Senegal were not organised under the old CFDT led regime. Producer organisation
development began in 1979, when grassroots producer associations were launched (known as
ABP, or Association de Base des Producteurs). These were also used to implement literacy and
post-literacy programmes. Accountability of the organisations grew, leading to them becoming
involved in supporting credit and later primary marketing, activities previously done by
SODEFITEX. The supply of free inputs ceased in 1988/89. Their purchase by farmers was instead
supported by credit, repaid from producer's earnings. This led to many producers boycotting cotton
for a time, until increased involvement of producer organisations in the cotton sector helped
improve the situation, although further problems occurred in 1996/97 over debt collateral (the
'caution solidaire'). This additional crisis spurred the creation of a national producers' federation,
the Fédération Nationale des Producteurs de Coton (FNPC), federating the many village level
grass-roots organisations.
1.3 What influences West African cotton producers?
This section sets out to map relations with input providers, ginners, and middlemen (with regard to
pressure by the fashion industry) of producers in the C4 countries
Using the value chain approach ('the whole range of activities from production to consumption
including the links that bind them' (FTAO, 2014)) and its four dimensions (input-output structure,
territory, governance structure, institutional framework), power in West Africa appears to be
mediated locally (a tripartite structure with producer unions, government and cotton companies)
and globally (traders, themselves influenced by and under power of others).
The cotton market itself is often distorted globally by government policies or subsidies, as well as
by current demand from spinners and ultimately retailers (but in anonymous supply chains,
decisions over fibre sourcing rest with spinners, not brands). The influence of producers is weak,
pushed down by external forces. For example, setting high cotton prices in West Africa will weaken
others in the sector, e.g., cotton companies and governments, whose reduced revenues further
affect sector services such as cotton seed research and development. So a response aimed to
protect the sector actually weakens it, but is an apparently rational response to sector support in
wealthier countries and with stronger industries. Governments' role is meant to be hands off, but is
also designed to support a balance of interests, including its own (revenues and employment, with
cotton also playing a sort of social safety net role8). For all that can be done in the domestic
governance sector, such as continuing to build the power of farmers and ensuring fair
representation within producer unions (for smaller farmers, women, workers), the sector in West
Africa remains largely at the mercy of global forces, meaning that national cotton associations and
regional alliances need to increase their power within global institutions as well as domestically.
8 Where cotton companies prefer larger, efficient farmers rather than smallholders they see as costly, gvernments like to see them
maintained in cotton. Cotton supports a measure of food security, as well as cash income.
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Power in West African Cotton Supply Chains
Producer power in West Africa is mediated first and foremost via their producer unions and national
federations, and then AProCA as a regional representative body. Through these, producers are
connected to gins, cotton companies, their national governments, and regional groups such as
UEMOA or the African Union. Much then depends on the capacity of the federations and
associations to manage relations, understand and track policy and markets, and effectively lobby
on behalf of producers. This is a big ask for small, under-staffed and underfunded organisations
relying also on elected members for time and skills.
Regional cotton companies, governments and institutions are also buffeted by external forces:
markets, donors, policies and so on. The fashion industry influences markets, certainly, but it is a
big question how much compared to other factors (although that fashion and textiles brands could
have more direct influence if desired is certainly true. Investment by Victoria's Secret in Fairtradeorganic cotton is an example of this, as is the role of the German Otto brand in developing the
Cotton made in Africa (CmiA) programme through the Aid by Trade Foundation (AbTF)).
Local actors have little or no control over external forces, except for those institutions which have a
local base and a need for West African cotton. Arguably, it is possible to influence and cooperate
with traders, especially those with a long term interest. This is why the sale of Plexus' trading
activities is a concern, as are the disappearance or take over of other traders such as Dunavant or
Reinhart with a history of involvement in Africa. The C4 and Senegal are competing with cotton
producers who are either in countries with textiles manufacturing bases for international markets
(India and China, for example) or are in countries with well organised logistics and often wellfunded promotion boards, such as the US, Brazil, and Australia. West African producers are a long
way from the market. Indeed, despite rising production and exports from the region, cotton exports
from Least Developed Countries, which include all the C4 and Senegal, have fallen as a
percentage of the total since 2003 (WTO 2 2015). When policies in these countries such as
subsidies or other support are taken into account, the situation looks even worse. Donors and
international institutions also influence what happens in the sector, simply by what they choose to
support, or by pushing for certain reforms.
From further afield, market movements, prices, and supply and demand also influence West Africa,
with little that can be done to mitigate impacts, except to work to improve quality to make the cotton
as attractive as possible. Here, though, reduced investment in seed research and breeding mean
the response is difficult. In the case of Burkina Faso, the introduction of Bt cotton has led to price
losses as the staple is now shorter than its previously prized cotton. While some farmers have
gained (larger farmers may have lower labour costs), others are losing, and traders may be losing
profitability. The situation is such that Burkina Faso is reducing its Bt cotton area, while some
reports are emerging that it will be phased out altogether, with reparations demanded from
Monsanto (Dowd-Uribe and Schnurr, 2016)
In this context, pressure by the fashion industry is a relatively small influence on the cotton sector:
cotton demand itself is fairly stable with small movements up or down, and a general tendency to
increase, although cotton's market share is declining as textiles demand growth is largely supplied
by synthetic fibres (Polyester represents 73% of demand growth since the 1980s). Increases in
market speculation, oil prices, competition for land use, and subsidies all impact cotton, and cotton
companies and traders. Between 2004 and 2009, man-made fibre consumption grew at 21% per
capita, compared to just 11% for cotton (FAO and ICAC 2011).
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Power in West African Cotton Supply Chains
Natural and Man made share in world textiles demand 1990-2012
100%
90%
80%
70%
60%
Natural fibres
Man made fibres
50%
40%
30%
20%
10%
0%
1990
2000
2008
2012
Source: elaborated by the authors from FAO and ICAC, 2011, ICAC 2013 and Textiles World, 2015
On a positive note, consumers like cotton, and so do many brands. They like to use it, but the
relative price of cotton and other fibres, especially polyester, guide much of the decision-making
over a significant proportion of cotton use. High (relative to polyester) cotton prices are thus
important. West Africa is however a price taker in the global market, as it has little or no domestic
manufacturing capacity and in recent years has suffered a declining quality reputation, meaning
that it is a fibre of last resort for many buyers rather than a first choice, so global pressures can
have a larger impact than in other regions where there is a manufacturing base (Turkey), and/or
strong government support (US, China, India).
Input suppliers on the other hand have little influence on West African cotton, as sales of inputs are
controlled by domestic cotton sectors. Input needs are put out to annual tender, rather than
supplied in a free market. However, the entry of GM cotton and Monsanto may change this, as
pressure may grow both to use GM seed and then associated chemicals.
With external influences growing, more competitors in the export market, and protectionist
measures in other producing countries, West African producers are weaker than ever. Although
local state control has reduced and producers participate more in the cotton sector, their power
remains weak. Within their unions, there may also be dominance by larger farmers, or well
connected individuals. The vulnerability of producers' situation is also exacerbated by growing
problems with climate, rainfall, environmental degradation and local political turmoil (a live problem
in Burkina Faso for example, where the President of UNPCB has been indicted for
misappropriation of funds). In Benin, the government has had to intervene and take back control of
the sector, after a dispute with a cotton company owner, Mali's reforms remain blocked (and the
head of CMDT was recently sacked) and financial problems have seen the government in Chad
take back ownership of the cotton company. Only Senegal seems a relative haven of peace.
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Power in West African Cotton Supply Chains
It remains to be seen what the long term impact of new players in West African will be. These
include the Biotech giant Monsanto, Brazilian research presence in Mali and Burkina Faso on soil
fertility, and China offering seeds and textiles equipment.
1.3.1 Producer power
Referring to the analysis in the FTAO Power report (2014), West African cotton producers are best
classified as part of captive set-ups, where 'small suppliers are transactionally dependent on
much larger buyers. Suppliers face significant switching costs and are, therefore, ‘captive’'. In the
case of the largest cotton traders, such as Cargill or Dreyfus, this puts many national cotton
companies on the same level as producers in terms of leverage. The main mediators of global
power in West Africa are traders. However, given cotton sector reform pressures, we need to add
global institutions (IMF, WB) and policy makers in countries supporting their cotton sectors (e.g.,
USA, China, India) to the list of those with power in or over the C4 and Senegal. This sees West
African producers' not only forced to accept prices, but also credit and input supply, leaving them
vulnerable to debt and income losses. Ultimately, cotton from the region does end up in Western
fashion, but there is no direct link, except for some Fairtrade and organic, small-scale, projects.
There is opportunity within national cotton companies for producers to engage with foreign traders
where producer unions have acquired a share in cotton companies, and international companies
such as Geocoton and Reinhart are also shareholders. The shareholdings offered to producer
unions under reform are designed to offer producers a stronger voice in decisions by companies.
Trading is a sector where more concentration is occurring, and there are few new entrants to the
sector. Plexus Cotton (now 25 years old) was one of the few, and as mentioned, is withdrawing
from trading, a concern as it has had a good record in Africa and sustainable cotton.
Nurturing small trading houses or new trading and buying platforms (Including farmer owned
companies) for West African cotton is an idea whose time has long since come, especially for
regional trading and the pooling of sustainable cottons. But knowledge and personal relations do
play a role in cotton trading, so this is something that needs to be built, and is why traders
themselves may be part of the solution as well as the problem. The fact that Plexus is moving out
of anonymous trading to focus on direct relations and investments is interesting and worth
watching. It may represent a new model, but it is too early to know what the outcome will be or
what the details are, at the time of writing.
The table below gives an example, for Burkina Faso, of cotton shareholdings in cotton companies.
Table 4: Corporate data for the three cotton companies in Burkina Faso
Company
name
SOFITEX SA
Faso Coton SA
SOCOMA SA
Established
1979
2004
2004
Capital
4,400, 000,000 F CFA 3,300,000,000 F CFA
6,000,000,000 F CFA
Shareholder
s
State (60%),
DAGRIS/Geocoton,
Banks (BIB, BiCIAB),
UNPCB)
(shareholdings have
DAGRIS/Geocoton (51%),
UNPCB (20%), SOBA (20%),
AGRITA (5%), SYA Participation
(4%)
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Paul Reinhart AG (31%),
Ivoire Coton (29%),
UNPCB (10%), SOBA
(20%), AMEFERT 10%
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Power in West African Cotton Supply Chains
changed following recapitalisation in
2005/6, and state is
now majority
shareholder)
Turnover
19 528 000 000 (2005) 950 120 000 (2005)
13 850 000 000 CFA (2005)
Zones
West
Centre
East
Gins
(capacity)
14 (405,000 tonnes)
1 (45,000 tonnes).
3 (100,00 tonnes)
Staff
1,300 permanent,
2,900 seasonal, (300+
production related
staff)
(39 field staff)
(42 field staff)
Registered
producers
234,500
24,000
40,000
Area under
cotton
(Hectares)
558,611 (2007)
41,620 (2005/6)
75,834
Production
(Tonnes lint)
253,850 (2005/6)
17,593 (2005/06)
27,228 (2005/6)
Many textiles brands report that they do not have direct links with traders, only occasionally with
spinning mills, infrequently with CMT mills, and more commonly with agents. Here is another
pressure point for power in the supply chains out of West Africa (Ferrigno 2014, RSN 2014).
Companies use this to deny being able to trace where their cotton is sourced from (e.g., to deny
the use of Uzbek cotton), although the link and traceability is possible. Brands are however
reluctant to take responsibility for another part of the supply chain (as they are already contending
with labour issues in factories, water pollution from dye houses, and so on) but shows how those
with potential power are able to refuse to take responsibility.
1.3.2 UNCTAD road map
The United Nations Conference on Trade and Development is pushing interventions to support
West African cotton, as 'Despite its significance in local economies, the African cotton sector is
faced with serious problems. Yield is low and has considerably diminished during the last decade.
Cotton research in most countries suffers from a lack of organization and means. Support
structures for trade and marketing are not always commensurate with the economic importance of
the sector' (UNCTAD 2015). The roadmap 'seeks to respond to the issues in the cotton sector
linked to productivity, marketing and value-addition'. Proposed interventions also include on inputs,
credit, natural resource management, extension and training, and advisory services. Areas like
inputs need attention. They do not only need to be available, but suitable. Managing intensive
production is difficult for the most resource poor farmers (See PAN UK, 2003). Credit to
smallholders is also a risk, and needs to be addressed with a focus on reducing costs and risks for
small farmers. Done well, this helps address natural resource management. Extension, training
and marketing all need addressing through improved profitability and competitiveness of cotton
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Power in West African Cotton Supply Chains
companies, investment in research and development, and a more strategic vision for trade are
needed, including more use of financial instruments by producing countries and companies in West
Africa.
While UNCTAD (2015) suggest the latter part of the bottleneck is in the hands of cotton companies
and international traders, governments also need to facilitate the right legal and regulatory
framework. The cotton sectors in West Africa need to be resilient in the face of market volatility,
responsive to fibre quality requirements, offer support for entry to the sector, including in niche
markets (organic, Fairtrade), support local industry, and as a sector, support governments' ability to
negotiate internationally. Governments and industry also need to support investment in the
infrastructure (storage, transport, energy, water) that backs up cotton production (and also other
commodities grown on cotton farms that can bring in additional revenues to producers, companies
and states. Research should be a critical underpinning of any moves, and investment is important
before staff are lost due to underfunding, low morale, and age.
1.3.3 National and regional policy
Since independence, West African governments have been focused on intensive, volume
production, aiming for consistent quality and fibre characteristics, to appeal to traders and spinners
overseas (initially in France). This laid the foundations for future problems, with high use of inputs
and high levels of debt, and reduced attention to other options, whether development of local
processing, other crop options or support for alternative cotton systems such as organic and
Fairtrade. Existing frameworks for cotton sector regulation need to embrace these systems, which
have growing markets and bring added value, for which a tripartite support is needed from
government, producer unions and cotton companies. We also need to see cotton sectors embrace
other aspects of sustainable development, such as diversification, food security, soil regeneration,
and improved attention to managing the productive systems as a whole (e.g., IPM), and not
forgetting social issues (labour, wages, children, gender equity). To a degree, all cotton sectors
have integrated some of this, due to the development imperative that attaches to cotton and its
importance to economies and rural communities. However, links to industrial and export policies
can be improved. New approaches such as the Smoothing Fund, if proven to be sustainable, can
be critical for this, and stakeholders (including donors) need to support this.
1.3.4 International policy
International policy (including national cotton policy potentially affecting world markets and prices)
is too often the elephant on West Africa's back. This is especially true of policy regarding cotton
subsidies, export subsidies paid to cotton farmers, and national policies relating to the manipulation
of production and stocks to influence global prices. These partially explain why fixed prices remain
a policy tool in the C4 countries and Senegal. It is an area over which producers and unions have
little control, and while AProCA might play a role in lobbying and advocacy, as could governments
via international fora, capacity is often lacking. The International Cotton Advisory Committee does
regularly raise the issue, and the issue remains live in WTO negotiations, but little changes as the
question is ignored, and the new US subsidy rules are simply rewritten to avoid obvious attack
points. Cotton companies in the region and even many traders have little influence on the subject
either. The fact that international negotiations like the WTO are now being bypassed by processes
such as TPP or TTIP (deals between developed regions in the main) is a further cause for concern,
as developing countries are not included, especially not the C4 and Senegal. The global balance of
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Power in West African Cotton Supply Chains
power is such that there is little pressure for a more balanced approach to trade and subsidy rules,
where reform should be demanded of all players, and not just some.
Support from the international community to West Africa comes mainly in the form of aid and
sometimes now in kind (such as donations of textiles equipment. China has for example donated
equipment to Benin, although without any technical assistance on its use), in exchange for access
to local markets (where dumped clothing, new or second hand, further impacts local textiles
industries).
West Africa receives donor assistance for cotton from a variety of sources including the European
Union, the USA and France. According to the WTO (2015), Brazil and China also offer support
programmes. Brazil offers the C4 (through the Brazilian Cooperation Agency) a cotton industry
development programme, while China has a programme to share 'cotton plantation technology,
and to provide machinery and other input to cotton producers, particularly in the Cotton-4
countries'.
1.3.5 Policy tools for African exports: EU and US policies.
The US offers its duty free access programme through the African Growth and Opportunities Act,
which was renewed in 2006. It supports duty free access for some African textiles. However, fibre
is not always African, as it is yarn and fabric that are covered9.
A 2008 report highlighted a 12% increase in textiles exports in 2002-06 from reduced internal and
external barriers to trade in Africa (including duty reductions), mostly to the EU because of historic
links and EU requirements to use certain fabric origins to benefit from duty free or reduced access;
AGOA in that period did not have any effect, but upon renewal preferential access is extended to
certain textiles, so may have more impact. Fabric for export in apparel to the US is often imported,
as there is not enough African production, and African fabric is used for EU exports.
Industry growth is hampered by capital constraints, energy supply cost and reliability, skills
shortages, transport weakness and water (sources and infrastructure). Of exports from SubSaharan Africa (SSA), 43% went to the EU, and 30% was within the region, a total of $467 million
out of global textiles exports of $123,520 million. Of the SSA exports, 12 and 11% respectively go
to Italy and UK. Reports also find that liberalisation was more advanced in Eastern and Southern
Africa (US International Trade Commission 2008).
AGOA exports to the US (for all products) fell in 2014 (USITA 2014). It thus appears that AGOA is
overall a failure despite some increases in exports. Its potential has not been achieved (Naumann
2015), although AGOA was due for renewal again in 2015. Williams (2015) view is that European
bilateral agreements are more effective than AGOAs' one way approach. The few positive impacts
have otherwise been in apparel for a small number of countries (Condon and Stern 2010).
International programmes are also supported by the International Trade Centre, which is
supporting a joint UK-China programme for jobs and growth in Africa10. The WTO estimates there
are some 30 active cotton programmes in Africa, for a value of US$ 247 million.
1.3.6 International markets and trade
Changes in international markets, trading and cotton pricing systems affect producers and the
9 See http://agoa.info/profiles/benin.html
10 http://www.africafashionguide.com/itc-to-support-joint-china-and-uk-effort-to-create-jobs-and-growth-in-africa/
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Power in West African Cotton Supply Chains
cotton sector in West Africa. As already mentioned, the process called 'Financialisation'11 is of
concern, as the growth of speculation and the entry of funds looking for profits in cotton has an
impact on price formation and trading. This phenomenon is not unique to cotton, and is growing
worldwide. But where cotton markets were once used primarily to manage risk, they are now seen
as a source of profit for non-cotton actors and a refuge in times of low returns in conventional stock
markets and investments. This has worrying implications for cotton farmers and cotton companies,
as those holding financial clout will not be concerned for sector stability. If speculation and
financialisation affect prices, and lead to wealthier countries protecting their producers, African
producers lose out, but have no influence on the situation.
While it is not easy to find out what share of the cotton trading sector is now subject to speculation,
rather than traditional hedging or physical trading, the situation is serious enough for it to be
addressed by the ICAC, particularly at the height of the global financial crisis, where it is said to
have led to a situation where 'many merchants could not recover from these losses in the physical
market. Some were driven into bankruptcy and others decided to go out of the cotton business'
(Townsend, 2009). Another sign of the resulting change is that there is less trust in the cotton
futures market by banks, with resulting tighter credit, and 'difficulties for merchants to purchase in
advance and at fixed prices large quantities of cotton (as was commonly done before the futures
market crisis)' (Townsend 2009).
The actual size of financial versus physical trading is difficult to quantify, but together with
subsidies will have an impact on small producers, who are far from markets and have themselves
no access to price support or hedging. Regarding the volume of speculation versus traditional
commodity trading, Staritz et al., (2015) note that 'several large international traders have their
own financial services units or hedge funds…. Such traders ... increasingly resemble financial
holding companies dealing with a wide spectrum of financial services and investments. While the
proportion of company revenues coming from such financial activities has remained relatively
small and variable, they have grown with respect to revenues derived directly from the trading of
physical commodities'. The authors also note that while there has always been some specialist
financial speculators in cotton (playing against those taking physical positions to hedge risk), there
has been an entry of other investors such as hedge funds, pension funds, institutional investors,
and investment banks, especially since the financial crisis. Here, the authors suggest 'an increase
in the share of financial investors fluctuating around 60 per cent from 2006 to 2015' (Staritz et al.,
2015). This study also states that futures prices, rather than the physical trade linked Cotlook A, is
becoming the cotton reference point for price setting and that Burkina Faso has looked at setting
producer prices based on New York Futures rather than the Cotlook Index. A recommendation from
this is to increase the use of price stabilisation/smoothing funds such as the one in Burkina Faso.
1.3.7 Buffer stocks
Buffer stocks are used in some countries (notably China) to manipulate prices and support
domestic industries. They are designed primarily to ensure a constant supply of raw material to the
cotton sector, rather than to increase sales. In the current global context, it is large producers who
can afford these, such as China, and India (India held a stock deemed 'comfortable' of 6 to 7
million bales (1.06 to 1.23 million tonnes) at the end of the 2014/15 season, for example, sufficient
11 'The increasing role of financial motives, financial markets, financial actors and financial institutions in the operation of the domestic and
international economies’ (Epstein 2005, 3, in Staritz et al., 2015)
Power in West African Cotton Supply Chains
to stabilise prices for the following year12). They protect textiles industries, while also helping
somewhat with price management and supporting producer incomes. Buffer stocks are usually run
by public entities, with only one private trader risking this, Louis Dreyfuss, one of the largest cotton
traders in the world (but it only holds some 15,000 tonnes of cotton, held in Asian ports, where
most world demand comes from, Zaslavsky 2015).
In the West African context, it is ginners who currently take the risks and costs of any cotton
stocks, except for those few Producer Organisations that manage sales, like OBEPAB in Benin
(although there will be some short term free storage after ginning). It would be harder to get this for
long for larger stocks. But with niche cottons, where supply at harvest often exceeds demand, only
small stocks are going to be held, for speculation purposes. Spinners on the other hand ask
traders to hold delivery stocks near factories in order for them to assess cotton characteristics, to
programme blends with other supplies, and ensure delivery according to production calendars.
This is what Devcot do for TDV (A French textiles company), in Dunkirk (Zaslavsky 2015).
Sustainable cottons are thus usually only held if the holding producer group takes the risk.
Generally, non-committed niche cottons are quickly sold into conventional markets, where market
uptake remains very low under most sustainability initiatives (Ferrigno 2016, forthcoming,
Zaslavsky 2015). West African sustainable cotton producer groups try to sell unsold cotton as
rapidly as possible.
In a highly competitive textile value chain, with reducing margins, spinners are shifting risk
downstream to traders, cotton companies and producers. This is even more troublesome in West
Africa where producer-cotton company relations can be fraught. Zaslavsky (2015) however
suggests that holding a buffer stocks has few benefits given the financial costs and risks, as losses
can mount to one or 200 million CFA for stocks as low as 100 or 200 tonnes, for a simple loss of
10% in the value of the Euro. The current situation also reflects the difficult trading conditions for
West Africa, including small volumes in individual projects that are of little interest to larger buyers.
Nonetheless, it is the opinion of the authors of the present report that there is a strong case for
more trading autonomy for POs in the region for niche cottons, and that both they and cotton
companies should still explore the use of forward contracts13 and other financial instruments, where
risks could be offset, with stocks held against forward sales at set prices. Building demand for
Fairtrade and other sustainable cottons is though essential and urgent for West Africa to avoid the
need to stock unsold sustainable cotton in the first place (hence the need for regional strategies
and new trading models – the current volumes are simply not large enough to interest cotton
companies, let alone traders (See Ferrigno 2016, forthcoming, for more discussion of possible
options and strategies).
1.3.8 Child labour
Child labour remains a problem in the West African cotton sector. It can be divided into different
types, ranging from underage children being employed full time in non-family farms to child
trafficking for forced labour purposes. Child labour occurs for various reasons, including poverty,
exploitation, discrimination, and lack of schooling. However, not all work children perform in cotton
farming is harmful to their development or exploitative. Children work supporting family farming on
12 Source: The Economic Times http://economictimes.indiatimes.com/news/economy/agriculture/india-to-carry-comfortable-cottonclosing-stock-for-2014-15/articleshow/47559418.cms accessed February 2016
13 A forward contract is a cash transaction where cotton is bought for a set price and specified delivery and transfer of ownership date,
where a futures contract does not necessarily involve delivery, and is a trading instrument. See the Cotton Guide for more information
at http://www.cottonguide.org/cotton-guide/cotton-trading-futures-and-options-contracts/ (accessed February 2016)
Power in West African Cotton Supply Chains
weekends or holidays, performing light tasks and learning skills.
According to local sources, it is common for children in West and Central Africa to assist with their
family household cotton production, including other agricultural production and undertake a number
of domestic household tasks, like fetching water, cooking food and cleaning the house and so forth.
The explanation provided for children’s work is that it is part of the child’s acquisition of life skills,
although poverty and/or exploitation certainly play a part. In Mali it was suggested by key
informants and producers that children’s work on family cotton farms does not interfere with their
schooling as children work on Saturdays and Sundays or during the holidays. This is also true
during the harvest times. The authors have noted in our studies in the region that Fair Trade (and
organic) cotton farming have positive effects on producer households as the Fair Trade and
organic benefits like higher prices and premiums enable some producers to hire adult workers, and
adult workers also contribute to improved cotton quality, which also increase sales. We also have
reports from organic farmers in Benin that higher incomes enable some producers to support their
children’s education and children have more time to focus on their schooling 14.
In 2014, Mali took modest steps to eliminate the worst forms of child labour. The Government
adopted the National Policy for Child Promotion and Protection, which aims to strengthen national
policies and programs to protect children from violence, human trafficking, and exploitative work.
The Government participated in several programmes to combat the worst forms of child labour and
assist vulnerable households. Also in 2014, Burkina Faso took concrete steps to eliminate the
worst forms of child labour. The Government published a study on hazardous child labour to
update existing legislation, and established the National Coordination Committee for the National
Action Plan on the Fight against the Worst Forms of Child Labour. It also adopted Law N° 0112014/AN, for the suppression of the Sale of Children, Child Prostitution and Child Pornography,
which strengthens existing prohibitions on commercial sexual exploitation of children and child
pornography. However, children in Burkina Faso are engaged in labour, including its worst forms in
mining and cotton production. Limited resources for the systematic enforcement of child labour
laws impede government efforts to protect children from the worst forms of child labour and the
lack of funding has hampered the implementation of child labour policies.
The conditions faced by many children engaged in cotton work are harsh, and payment nonexistent or far below adult earnings. In Benin, migrant children aged between 6 and 17 in the main
cotton growing region in the north earned around $105 for a seasons work in 2003, working 10
hours a day on average in harsh conditions. In Burkina Faso, cotton labourers earn far below the
country’s minimum wage. The youngest children, in charge of herding animals, earn as little as 75
Euros/year. Older children may earn 90 to 105 Euros per year if they stay for a full season,
although bosses may renege on the agreed wage, paying instead for the amount of work done. If
the farmer claims to have not made enough from the harvest, the children must stay and work for
another year before receiving any money (many will live with the households and receive board
and lodging). In Mali, child labourers, sent to the fields by impoverished parents, receive a small
bull in return for seven to eight months’ work for cattle owners as well as board and lodging. This
does mean that impoverished parents are relieved of the need to support the child, and the child is
not forced into begging. Other children work seasonally, missing school, to provide their families
with a few bags of grain. Children who work directly for their parents receive a new outfit and pair
14 Although not documented in the course of formal impact assessments, these anecdotes are common, and we have recorded them
in various field research reports between 2002 and 2015.
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Power in West African Cotton Supply Chains
of shoes once the cotton has been sold.
In West Africa it is has been reported that child traffickers exploit children for cotton work, with or
without their parent’s consent. They are forced to remain months on end before receiving little or
no payment. They endure extremely long hours, with some working seven days a week, all year
round (meaning they work on other crops other than cotton, for example, livestock pasturing
outside the cotton season). They are commonly exposed to pesticides, poorly nourished, and are
often subjected to verbal and physical abuse when they become too tired to work. Some have
been forced to work through the night. Organic cotton farming could have an increased risk for
child labour if attention is not paid to ensuring that children are not involved. For example, children
of migrant cotton workers could help their parents out as parents see the lack of chemicals and
pesticide use as safe for their children. Furthermore, if producers do not have cattle to help rake
up weeds, children are often engaged to clear the weeds by hand using dangerous tools.
The risk for brands is severe with the US publishing a list of countries where goods are produced
by child labour, and the UKs Modern Slavery Bill, which places a requirement on companies to
report possible child and/or forced labour in their supply chains. While child labour is a problem,
and threat to West African cotton, it is an opportunity for Fairtrade and other sustainability initiatives
to target producer led–risk mitigation programmes, including community based monitoring and
remediation systems in child and/or forced labour.
1.3.9 Subsidies
Around half of global cotton production receives some subsidy or other state support (e.g., export
or import bans or loans, stockpile/buffer policies…). These disproportionately affect those countries
and producers less able to respond, such as the C4 and Senegal. According to the ICAC (2015),
'Subsidies to the cotton sector, including direct support to production, border protection, crop
insurance subsidies, and minimum support price mechanisms are estimated at a record $10.4
billion in 2014/15, up from a record of $6.5 billion in 2013/14'. Subsidies were paid by 12 countries,
for an average 22 US$ cents per pound of cotton. Up to 83% of world production received subsidy
in 2008/9, and the average has been 47% between 2009/10 and 2013/14 (In 2014/15, the average
was 76%) (ICAC 2015). Many subsidies are linked to world prices, i.e., the amount rises as prices
fall. In West Africa, subsides are usually given for inputs only (seeds fertilisers, pesticides). For the
C4 countries and Senegal, the amounts quoted by ICAC are Mali ($26 million (5 US Cents/lb)),
Burkina Faso ($30 million (5 US Cents/lb)), and Senegal ($2 million (9 US cents/lb)). China paid
the highest total subsidies in 2014/15, ahead of India, Turkey and the USA. China also pays the
highest subsidy per pound (58 cents/pound).
The question of subsidies remains on the agenda for the WTO, which met again in December
2015, in Nairobi, Kenya. On the agenda was how to 'achieve duty free and quota free access for
cotton exports from least-developed countries (LDCs) to developed countries and to increase
import opportunities in developing countries' (WTO 2015, AllAfrica 2015). There seems little hope
of progress in the near future (quite the opposite according to SUNS 2015), despite that the
problem has been on the agenda since 2005. This underlines the lack of power of African
producers. Meanwhile, the new (2014) US farm bill is reported by Andersen et al., (2015) as having
''significant trade-distorting effects' and that 'This continues to be particularly problematic for many
developing countries which largely rely on cotton production for export, such as the C-4 in West
Africa''.
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Power in West African Cotton Supply Chains
Historically, the cotton dispute (by the C4 with Brazil) came to a head during the so-called Doha
Development round of WTO negotiations, with goals including elimination of 'export subsidies by
developed countries; provide duty and quota-free access for cotton exports from the leastdeveloped countries; and ambitiously reduce trade distorting domestic subsidies for cotton' (WTO
2015). It is reported that 'Our simulation model results suggest that US subsidies are causing and
will cause significant financial hardship for US competitors in the world market for cotton: we find
that, at an expected price of US$ 0.70/lb of cotton, all US cotton programs together artificially
inflate US cotton acreage by about 2 million acres, boost US cotton export by 3 million bales of
cotton a year, and suppress the world cotton price by almost 7 percent', at a financial cost of US$
3.3 billion (Andersen et al., 2015). Given the higher Chinese subsidy, how much does this cost and
would it not be enough to compensate for the current costs of the cotton system in West Africa?
1.3.10 Prices
Countries in the C4 and Senegal fix prices before the growing season, as a way to encourage
farmers to grow cotton and to ensure some stability. Producer prices are not dependent on
prevailing international prices at the time of harvest (e.g., Cotlook A or New York futures), although
cotton company sales will be based on prevailing prices, unless fixed price forward contracts are in
place (traders feel national companies should use these more). Few national cotton companies do
this, although the traders who are their shareholders may do so. The prices fixed by governments
and regulatory associations do not correlate to prices and futures at the time of fixing: while global
Cotlook A prices have been in decline since May 2014, producer prices for 2015/16 look et to rise
in Benin and Burkina Faso. One problem is that setting prices before planting means movements
cannot be predicted, another is that most WA governments have ambitious production targets, yet
reducing prices would lead some farmers to reduce or stop cotton plantings.
1.3.11 Cotton sector reforms
Cotton sector reforms in Africa are often poorly and partially implemented, poorly financed and
supported, and undertaken in isolation from what is happening elsewhere, meaning they leave
producers even more vulnerable.
1.4 Value chain set-up and stakeholder activity in the C4 countries
Input supply
(via cottcos and Pos)
Interprofession:
(state regulation)
POs, cotton companies
Government
(state regulation)
(regulation,
Cotton companies
Price-setting,
Value
Chain
map
Ginners
Research,
(part, full or
extension)
not privatised) Producers
International traders
and unions
(many
shareholders
(input supply,
in
cottcos)
Price-setting,
Cottco shareholding,
Sector governance)
West African cotton value chain map
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Power in West African Cotton Supply Chains
The graphic above shows the different organisations involved in the sector and their roles, from
seed cotton growing, to the gin and on to fibre trading. The graphic under Section 1.2 showed the
longer supply chain, actions and relations for cotton. Table 3 shows details on the three cotton
companies in Burkina Faso, for which we have detailed data. The example below is of seed supply
and breeding, showing the different relations and interactions (from Ferrigno, 2012)
Value chains in West Africa, covering seed cotton production, ginning, and fibre trade are all fairly
similar, aiming to link producers to gins, and gins to traders and primarily onto the international
market. In most countries, farmers are linked to zones, and to specific gins/buyers, although Benin
had a system whereby the state allocated cotton to gins, until its recent crisis. In return for selling
at a fixed price to a guaranteed buyer (the gin), farmers receive inputs supplied on credit, and
usually some extension (of variable quality), the value of which is deducted from cotton payments.
These are usually made to producers a few weeks after harvest, when the cotton has been ginned.
Seed is also supplied to producers, either by cotton companies or by the government or research
(seed is developed, bred and multiplied by research institutions, with cotton companies sometimes
involved in multiplication). Specialised farmers produce clean planting seed, which is kept separate
from other seed cotton at the gin to maintain purity. Seed quality however is a reported problem for
many farmers, and research is often underfunded. New varieties are released quite rarely, as a
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Power in West African Cotton Supply Chains
result of funding shortages. Seed development and other research should be paid for (by state and
through levies on the sector), but low returns in the cotton sector, partly due to high producer
prices, mean finance is often short. Only in the case of Burkina Faso, with the entry of GM, can we
see some change, and even there there is little money for new variety development (Ferrigno,
2012).
1.4.1 Risk management and Smoothing funds in West and Central Africa cotton sector
Few national cotton companies have the in-depth knowledge, and even less professional practice,
of using risk management instruments. However, as the limitations of a fixed price system and its
limitations when cotton is sold up to 18 months after planting became obvious, a need exists for
ginners/cotton companies to be more sophisticated in managing price risks. That explains the
genesis of the smoothing mechanism.
The use of market risk management and futures instruments remains low in West And Central
Africa. This is partly explained because cotton and other commodities have been used as
stabilisers for national economies, aiming to protect them from market fluctuations. The use of
market instruments (financial futures, options) can be useful to cotton companies that carry market
risk, to help manage these within a growing and marketing season, but are not used by national
cotton companies. The recent accumulation of heavy losses at cotton companies reflects both low
international prices, and companies' own deficiencies in managing sales and price risks.
The idea of smoothing prices is based on ensuring deductions are made when prices are high, to
feed the fund, and then 'spent' when prices are low to compensate for losses. However, more
awareness is needed among sector stakeholders (including cotton companies, producer
organisations and banks) before these funds become more widespread outside the pioneer,
Burkina Faso. Producer organisations need to understand the risks cotton companies face in the
market, and how risks can be minimised, to play a better role in the sector.
1.4.1.1 How the smoothing fund works
The smoothing fund in Burkina Faso was set up by the Inter-professional organisation, AICB, to
reduce the impacts of price volatility. The fund is the property of AICB, and is organised around the
following activities:
- Determine standard costs, with the umbrella organisation.
- Determine a pivot FOB price at the beginning of the season, based on the need to smooth
out projected fluctuations through the season, using the average price over the previous two
seasons.
- Fix the producer price at the beginning of each marketing season by deducting the FOB
price from the standard costs.
- Calculate a season end balance, based on production, average Cotlook quotes and
updated costs.
- If the result is positive, the fund is replenished up to its ceiling, with the balance shared
between producers and cotton companies.
- If the balance is negative, support is paid to cotton companies.
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Power in West African Cotton Supply Chains
AICB entrusts the fund's management to a bank as per its rules.
1.4.1.2 The role of the bank
The commercial banks who manage the fund are are selected through a tender process. The
successful bidder then manages the fund and its deposits, for a three year mandate. The fund
totals up to 10 Billion FCFA (15 million Euros), and the account is not allowed to go into deficit. The
responsibilities of the bank include:
- Calculating the pivot and producer prices and submitting them to the inter-professional
committee for approval.
- Determining at the end of each growing season the results and gross margin on the basis
of the production information provided by the inter-profession/AICB.
- Issuing transfer requests for payment by the cotton companies if margin is positive
- Issuing a payment request if the balance is negative to the cotton companies
- Maintaining the account in accordance with the rules, and report on it to to AICB.
AICB oversight is via its Executive Secretary. Fund accounts are externally audited.
1.4.2 Producer participation in governance and supply chains
As already described, all countries except Chad now have national producer federations, which
participate in sector governance, and are also members of the African Cotton Producers
Association (AProCA). This ensures their participation in sector governance, within the limitations
of the capacity of elected and appointed officials. This is one of the problems that must be
addressed, alongside equality and participation within POs and between members (gender,
minorities, smaller producers; in other words, power relations).
Producer organisations thus have some power, but it is relative. They have a seat at the table of
national sector governance, in price setting, and regulation. However, it is Cotton Companies and
international traders who mediate between national sectors and international markets. Producer
power here comes through their shareholdings in cotton companies, although the levels of this are
low compared to others, meaning they have no functioning majority or veto.
Meanwhile, the overall vision for cotton, implemented at the grassroots, still remains one of high
and intensive production, of large volumes of consistent quality cotton for export. Who does this
work for? Do all farmers share, or benefit from, this vision? How much influence are producers
really having on cotton sector vision? Is any work looking at a new vision for the cotton sectors,
that takes into account the different needs of different kinds of farmers as well as of the cotton
companies and international markets? These questions show why a strong AProCA is essential, as
an umbrella organisation with a lobbying remit, among its other roles. Where national associations
may be best placed to lobby their own governments and local cotton companies, a pan-African
association is best placed to lobby regional institutions, donors and international bodies and to
work with its stakeholders on a pro-farmer sector strategy. However, lack of capacity (in staff
numbers and training) and funding for general research, advocacy, information and lobbying work
hampers AproCAs ability, and limits much of their work to funded project work, although the
organisation is trying to make its funding more sustainable through membership fees.
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Power in West African Cotton Supply Chains
1.4.3 Benin
Benin faces an uncertain future for cotton over potential new reforms, the shape of which is not yet
clear. Reform has been pending since 2012, when the government took back control of the sector
following a crisis, centring around one of the private ginning companies that entered the sector
after earlier part-privatisation.
The earlier reform began in 1999, when the Association Interprofessionnelle du Coton (AIC), an
inter-professional association groups cotton sector stakeholders (constituted of three families:
Inputs importers, Ginners and Farmers’ Associations), was first created. The following year, the
seed cotton monopoly previously held by SONAPRA (the national cotton company) was abolished.
Gins were privatised but the allocation of seed cotton to gins was still controlled by the state. A
credit agency for managing payments (CSPR – Centrale de Sécurisation des Paiements et
Ristournes) was also established, to manage financial flows in the sector, including payments to
producers. Reform continued with cotton sector management being passed to private operators,
and the establishment of a ginners' association and a Cotton Development Company (SODECO),
providing a framework for consultation between the state and the cotton sector. Producers were
organised through the establishment of village level cotton cooperatives (CVPC – Coopératives
Villageoises des Producteurs de Coton), with an agreement then signed between the Producer
Organisation and the AIC.
Since 2010, inputs for use in cotton have to be approved by the National Committee for the
Approval and Control of Phyto-chemicals (CNAC).
Since 2012, and pending reforms, there is a Transitional Institutional Framework for the
Management of the Cotton Sector. Among ideas for cotton sector reform are the introduction of
zones similar to Burkina Faso, to the number of 4, and a commission for cotton procurement. The
government is also setting cotton prices and has established a central office for input importation
called “Centrale d’Achat des Intrants Agricoles du Benin”. Meanwhile, all cotton sector operations
are directly led by the Ministry in charge of agriculture and its structures in the ground. In this
context, farmers’ organisations are hardly visible in terms of decision making. However, informants
suggest nothing is permanent, as the country is currently in an electoral process that will lead to a
new president and government in April 2016. Informants also hope that new reforms place the
cotton sector back private and producer organisation hands, with the public sector setting a
favourable environment for this. In 2015 a Sector Regulatory Authority was set up, 'responsible for,
inter alia, monitoring compliance with texts and their implementation' (WTO 2015).
Table 5: Benin cotton data
Production
2014/15
2015/16
393,000 tonnes
500,000 (est.)
Revenue contribution to government 200 Billion CFA (70% state
revenues, 20% GDP)
Employment
10 million
Source Reuters 2015
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Power in West African Cotton Supply Chains
Meanwhile, external forces have their eyes on Benin, with China offering '”to improve Benin's
cotton yield by introducing a Chinese cotton variety that gives 6 tons of cotton per hectare against
a Beninese variety that produces less than 2 tons per hectare," (Forum on Africa-China
Cooperation, 2015). As there is no mention of any field trials taking place, this seems unlikely –
cotton seed research exists because varieties cannot simply be transplanted from one country to
another – success depends on adapting to different ecologies, pest and disease complexes, and
so on. Benin is also home to antique textiles equipment given under earlier schemes, which is not
in use, as well as more modern donated equipment. However, there is a lack of trained staff,
design capacity, marketing, finance and reliable and affordable energy supply and so this is
another failed scheme. The Forum on Africa-China Cooperation (2015) is also promising farmer
training, to address 'reduced fertility of the soil, climatic changes, high production costs and lack of
training for farmers'.
1.4.4 Burkina Faso
Burkina Faso has seen relatively successful reform, and the establishment of a stable cotton
sector, albeit with some concerns over politics within the producer association UNPCB, the relative
size of concessions and the impact of the introduction of GM cotton, as well as over the state of
domestic cotton research.
Cotton sector reform started in 1998, when the National Union of Cotton Producers of Burkina
Faso (UNPCB) was officially recognised, with producers being handed a 30% share of national
cotton company SOFITEXs capital. SOFITEX supported this movement, hoping for more
professional and receptive partners. The structure begins with grassroots village groups (GPC),
department (county) level groupings (UDPC), regional federations (UPPC) and then the national
structure, UNPCB. There are some 12,250 GPCs in 4,162 villages, 280 departments and 36
provinces. An inter-professional association (AICB) was then established, and in 2001 the
SOFITEX monopoly was broken up, and the cotton area divided into three zones. Two new
companies were created (Fasocoton and Socoma), although SOFITEX received the best and
largest concession. Producers received capital in the new companies as well. GM trials began in
2003.
In 2006, a Professional Association of Cotton Companies of Burkina Faso (APROCOB) was
established. The Price-Smoothing Fund Association (Association fonds de Lissage AfdL) was
established in 2008, followed by the Cotton Inputs Fund Association of Burkina (AFICB) in 2012.
Cotton zone concessions were renewed in 2014 (WTO 2015).
The state remains involved in SOFITEX (Staritz et al., 2015), however, and SOFITEX probably
retains quite a lot of power in the sector as a whole due to its large size (Ferrigno, 2011),
controlling 80% of the country's production (Staritz et al., 2015). Two Traders, Reinhart of
Switzerland and Geocoton of France (ex-Dagris and CFDT) are shareholders in SOFITEX,
SOCOMA and Fasocoton, meaning traders have influence in the whole sector via all three
companies. Each company is effectively a monopsony in its zone, buying all cotton and providing
credit and input packages to farmers.
As well as a fixed price, the smoothing mechanism allows for potential payments to farmers at the
end of the season, if world market prices are above the agreed floor price (which is set at the
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Power in West African Cotton Supply Chains
beginning of the season, Staritz et al., 2015 2015). Farmers in Burkina benefit from knowing prices
in advance and can plan accordingly, with the limitation that there are not many other crop options
(which suggests a need to invest in diversification). The ultimate guarantor and responsible party
is the government.
Table 6: cotton production data for Burkina Faso
2014/15
2015/16
Production
690,000 tonnes
531,000 tonnes
Area
660,592
Bt cotton area
446,000 (69%)
Yield
1,079 tonnes/hectare
Fertiliser price
15,500 CFA/5kilo bag (-5% on
previous year)
Export share
17.7%
Farmers
350,000
Source: FAS Gain
Prospects for cotton in Burkina Faso are reasonable, with EcoBank (2015) reporting a higher
output than FAS at 707,145 tonnes of seed cotton for 2014/15, or 300,000 tonnes of fibre, which is
31% of the (Francophone) region's output (USDA FAS 2015 give a figure of 288,000 tonnes,
slightly lower). The 2015/16 price is reported as CFA 235/kg, which no other sources report as yet
– this set at a level to retain farmers and achieve higher production: 'Given that cotton fibre exports
are the second largest source of FX earnings, after gold exports, the Burkinabè government plans
to offset the cost of higher farm-gate prices elsewhere in the chain, rather than risk a collapse in
output'. They also report that the Bt cotton area will be reduced in the coming season (from 73% to
53%), as Bt cotton has a shorter staple length than domestic varieties, which means it fetches a
lower price on the global market (despite it reportedly reducing labour costs and costing less
overall). Work is under way to improve the cotton variety into which the Bt gene will be introduced.
The reduction in Bt area makes something of a mockery of the Crop Life (2015) claims that Bt
cotton has provided Burkina Faso a 'massive economic boost' with '$100 million in additional
economic benefits' (which the article fails to quantify or detail). But in an intervention designed to
hand Monsanto more power and influence in Burkina Faso, and despite this Bt cotton setback, the
company is launching a service called Mobicot, 'a free mobile cotton consultancy service….(which)
aims to improve practices and yields vis SMS messaging' [Ecofin reported in Com-Watch 2015).
Production is expected to be 800,000 tonnes of seed cotton in 2015/16, higher than other
estimates, although the El Nino weather could lead to drier conditions and lower production
(Ecobank 2015). To support the sector, a decrease in input prices is also being supported by a new
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government fund, which 'acts as a guarantee for cotton companies’ inputs purchases'. Burkina
Faso is also being supported by donors.
1.4.4.1 Stakeholder roles
One of UNPCBs roles is economic, concerning seed cotton marketing, strategic and non-strategic
input supply and marketing, and credit management, as well as a wide range of services such as
information, training, and support to Council members. In terms of marketing, seed cotton
collection is done by producer groups (GPC) through self-managed markets, which are paid for by
cotton companies through seed cotton purchase commissions (€6.48 per tonne of seed cotton).
The government participates by defining agricultural policy, developing infrastructure and
developing and implementing the regulatory and legislative framework. Similarly, government plays
a role in the regulation and control of sector actions through protocols signed with producers and
cotton companies in September 2004. The Government supports producers and cotton companies
by subsidising inputs for cotton production.
Cotton companies ensure:
 Input supply to producers;
 Support to the producers' council;
 Purchase and collection of seed cotton;
 Seed cotton ginning;

Adding value to finished products (fibre) and by-products (seed, fibre waste)
Input supply includes procurement and distribution of inputs, and provision of credit for their
acquisition. Producers are involved in the process, beginning with an assessment of needs by local
groups. Cotton Companies then lead an international call for tenders for cotton pesticides and
fertilisers, using funding from a banking pool including local and/or foreign banks. Distribution to
producers is done through cotton companies, with credit to producers being supported by banks
such as BICIA-B and local 'caisses populaires', which are micro-credit institutions. Recovery of
credit is by deduction from farmers payments. A national banking pool also ensures the initial
purchase of seed cotton, with an international pool ensuring payment of balances. Banks also
support capital investments (e.g., lorries, plant).
Cotton research is led by INERA, the national research institution for environment and agriculture.
Cotton research is funded by the sector, which through SOFITEX and other companies has
contributed just over 3 million Euros in the last 10 years. The role is essential to the sector
especially with the push for biotechnology, with Monsanto and AICB also contributing to budgets.
However, budgets do seem insufficient.
1.4.5 Chad
Chad's cotton sector is little reformed, with a single cotton company, CotonTchad, recently taken
back under state control following financial problems. There is no single national producer
federation (attempts at reform date back to 2000, with the set up of a task force). CotonTchad
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leads input distribution, seed cotton collection from producers, ginning, transport and marketing of
fibre.
Table 7: Chad cotton production data
2014/15
2015/16
Production
130,000 tonnes
216,000 tonnes
Lint exports
31,700 tonnes
52,000 tonnes (est.)
Area
256,000 ha
Yield
510 kg/ha
Main export partners
Bangladesh, India, Indonesia,
Portugal, Germany
Price (top grade)
240 CFA/kg
People dependent on cotton
Nearly 3 million
Chad subsidies to inputs
CFA 6.9 billion (fertiliser, budget)
Source: CotonTchad SN
Reform does however remain on the agenda for Chad, with plans relating to market access
(boosting supply to drive exports), domestic support (support livelihoods, education and health)
and export competition. On export competition, Chad continues to call for action on subsidies in
order to level the playing field, as 98% of its crop is exported.
Research in Chad is led by ITRAD (Institut Tchadien de Recherche Agronomique pour le
Développement), created in 1997 after the French institute CIRAD quit the Sudanian zone of Chad.
ITRAD is organised as Regional Centres for agronomic research and thematic research
programmes. It conducts planting seed production (base and pre-base), and research on crop
protection (diagnosis of resistance of Helicoverpa, for example), herbicide experiments (Calliope,
Syngenta), agrarian diagnostics, and analyses of studies and practices.
Table 8: Production figures, producer income, and sale price (1997-1998 to 2012-2013)
Year
Cultivated
area (ha)
Seed
Yield
Producer
Cotton
(kg/ha)
income
Lint
output
Lint
export
Export price
(CFAF/kg)
(metric
(metric
tons)
Tons)
1997-98
336,173
263,476
780
50,193
103,877
98-99
281,633
161,645
574
27,229
65,437
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99-00
291,700
184,004
631
27,474
74,834
69,925
737
2000-01
237,500
143,032
602
25,978
58,077
56,037
852
2001-02
318,014
164,141
516
26,912
67,363
62,878
713
2002-03
249,707
168,484
675
26,613
74,311
68,643
732
2003-04
207,619
102,231
492
18,802
42,022
40,383
826
2004-05
268,245
207,535
774
36,230
83,906
79,605
602
2005-06
295,885
181,620
614
30,335
71,489
68,942
634
2006-07
247,470
98,055
396
19,843
40,291
38,745
625
2007-08
199,580
115,182
611
16,091
46,471
39,487
670
2008-09
163,796
70,977
433
15,073
28,574
26,434
624
2009-10
101,200
35,092
347
6,702
14,038
13,303
971
2010-11
131,700
52,570
399
9,613
21,355
20,820
1,315
2011-12
172,380
78,895
458
17,157
31,955
31,130
912
Source: COTONTCHAD SN
The final important actor in Chad is the Office National de Développement Rural (ONDR). This
(state) organisation is in charge of extension and supervision of producers, covering the entire the
territory. It is also in charge of structuring the rural world. It has two agreements with CotonTchad,
one to provide training for the cotton field agents, and the other to take part in the commission for
arbitrating on cotton seed factory quality disputes.
Producers are organised through the National Union of Chad's cotton producers (UNPCT), the
most representative producers’ organisation. It ensures cotton production, which it sells to
COTONTCHAD through self-managed market (MAG). It also participates in tenders for inputs. It
suffers from a lack of structure and organisation, which reduces its weight in the cotton sector.
Other POs are structured around production, storage, processing and marketing of agricultural
products
Cotton, which used to be the jewel in the crown of the economy of the republic of Chad (AproCA et
al., 2014), accounted for 90% of the country’s exports in 1987. However, numerous problems in the
cotton sector have compelled the State to launch a weak liberalisation process, privatising
CotonTchad’s oil mills and soap factories, a process which has yet to deliver on its promises. The
economic weaknesses in the sector, and the existence of a cotton monopoly in terms of cotton
purchase, processing and marketing destabilise the sector. The cash flow problems of the
company aggravate the situation, and mean the sector's producers are largely left to their own
devices. This is why it is essential to set up a strong and functional federation of cotton producers
able to participate in sector management and governance, and improvements are needed to
ensure the survival of a sector on which 3 million people depend.
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1.4.6 Mali
Cotton sector reform in Mali has been on the cards since 2001, when the Mission de
Restructuration du Secteur Coton (MRSC) was established (under pressure from donors and the
World Bank). This followed financial crises in the cotton sector in the late 1990s. Despite the break
up of production into four subsidiaries under a central holding company within the Compagnie
Malienne des Fibres Textiles (CMDT), cotton in Mali remains a monopoly (although there is a very
small second company, OHVN, which controls around 5-6 % of cotton production). In 2008, a
national cotton producer cooperative and a professional association for cotton companies were set
up. Technically, CMDT capital was opened to private parties in 2008. Since 2010, the sector has
been governed by a National Strategic Framework for the Development of the Cotton Sector
(CSNDSC) and a Cotton Sector Regulatory Authority (ARSC). A price setting mechanism has been
in operation since 2002, which links prices paid to farmers to production costs, industrial costs and
international prices.
Table 9: Mali production data
2014/15
2015/16
Production
547,000 tonnes
650,000 tonnes
Area
538,000 Hectares
Yield
1,015 kgs/ha
Source: USDA FAS 2015
A tender process was launched in 2003 for the sale of one gin, in the OHVN rather than CMDT
cotton area. The process was halted in 2004 due to a lack of suitable candidates. The Malian
government still wanted to privatise CMDT (representing 95% of national production) by the end of
2005. However, that process was postponed several times according to the MRSC, due to
presidential elections and the importance of cotton to the South of Mali, where half the population
lives. More delays are expected, especially as few stakeholders are very enthusiastic about
liberalisation. As well as reform of CMDT, there were also goals to build the capacity of producer
organisations, the establishment of an inter-professional organisation, a price support fund owned
by producers, and a quality classing office.
The establishment of four subsidiaries of CMDT did take place in 2009, and the government paid
off farmer cooperative debt. In 2005, one of the cotton seed crushing plants (Huicoma) was also
sold to a group of local investors. Tenders for the privatisation of CMDT subsidiaries were launched
again in 2010, and a short-list established. The goal was for private investors to own 61% of the
capital, with producers and company staff holding 20 and 2% respectively, with the remaining 17%
held by government. Each subsidiary would have a regional monopoly on cotton purchase, ginning
and sale. The process was disrupted by a coup in March 2012.
1.4.7 Senegal
The cotton sector in Senegal has a single cotton company, SODEFITEX (Société de
Développement des Fibres et Textiles), and producer unions organised via the Fédération
Nationale des Producteurs du Coton (FNPC), who work under a framework agreement between
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them. As a very small producer Senegal has focused on the quality of its cotton, especially since
losing most of its textile industry and well regarded spinner Cotonnière du Cap Vert (although there
are rumours of new mills under consideration). SODEFITEX has also developed into supporting
crop diversification and rural development.
Table 10: cotton production in Senegal
2014/15
2015/16
Production
26,000 tonnes
30,000
Yield
1,059 kgs/ha
Area
25,000 ha
Source: USDA FAS 2015
The main advantage of the Senegalese cotton sector is the strong partnership between its two key
actors: FNPC and SODEFITEX. Their collaboration is governed by a three way agreement
between them and the government. There is also a quality charter, aimed at making Senegalese
cotton quality a major selling point (it already receives a good price on global markets).
The sector also has other strengths, notably a good management system integrating quality, safety
and the corporate work environment in a unified management system. The system also protects
cotton supply for local spinners, while receiving a high market price, so farmers are guaranteed
better incomes. FNPC is a member of the SODEFITEX board, as an observer, pending a
forthcoming acquisition of a 20% share in the company (for the time being these are held by the
government). SODEFITEX and FNPC are both stakeholders in the Senegalese inter-professional
cotton Association (ASIC).
SODEFITEX has been involved in Fairtrade cotton for a number of years, and there is also a
Fairtrade-organic project, organic from 1994, and Fairtrade since 2005.
The Federation Nationale des Producteurs du Coton was born from an initiative by SODEFITEX
and a desire by producers to become more professional. The grassroots farmer organisations
(ABP) were village based organisations, not crop based (and so included all products, such as
groundnut, maize, rice and cotton). This made them hard to manage. In 1998, the 70,000 cotton
farmers organised free democratic elections by secret ballot, forming the FNPC around local
producer groups (GPC). It has a board of directors formed of 16 sector union presidents. Its
primary mission is cotton production, and activities cover research through producers and village
based technicians, extension activities, monitoring of production methods, and collection of data for
SODEFITEX. The FNPC also checks and distributes inputs ordered through village managers, and
manages the subsequent credit debt and its repayment at GPC level. FNPC manages credit of 3 to
4 billion FCFA annually, and manages the debt solidarity (caution solidaire) programme. FNPC is
also a member of the support fund set up by government, SODEFITEX and donors (The French
Development Agency, AFD). The set up, although beneficial, is however threatened by the current
trend in world cotton prices.
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1.4.8 Influence map
Table 11: Producer influence map
1.5 The benefits and disadvantages of the governance models in the C4 and
Senegal
Participation by producers is by far the best outcome of reforms to date. Strong and effective
farmer unions can positively influence outcomes and policy, although over-attention to producer
concerns in countries highly dependent on cotton has risks, for example that prices will be set too
high to ensure producers plant cotton, thus rendering the sector uncompetitive and financially
weakened, affecting for example investment in research. Balance has yet to be found. The focus
on high volume production has also led to over-use of inputs, and attempts to subsidise these have
not prevented many farmers falling into debt traps.
Senegal, followed by Burkina Faso, offer the best examples of well functioning producer
organisations and well organised multi-stakeholder governance between producer unions, state
and cotton companies. Shareholding by producer unions in cotton companies is another example
of good practice. Burkina Faso's Fonds de Lissage is another good example, albeit it is early to say
if it is financially sustainable. More needs to be done here to manage the prices set for farmers,
and their expectations of always getting a good price. There is a role for AProCA here in monitoring
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international price movements, and communicating them to farmers, and thus helping work out
price recommendations for governments, actions which might be viewed with suspicion if coming
from state, cotton companies, international traders or other actors who might be seen as having a
conflict of interest.
Governments are most effective in setting the regulatory framework and sector policy, and in
participating in international discussions and campaigns around the negative impacts of subsidies.
They should also be more supportive of Fairtrade and other sustainable cottons, but a clear
business case is needed for what the benefits could be, such as reduced production costs, or
reduced costs of importing inputs and technology (a better balance of payments)15.
Governments, producer unions and local promoters of Fairtrade also need to make the case for
producers to be able to sell their sustainable cotton directly, without depending on cotton
companies, or other types of gatekeepers, as happens in Benin with the NGO OBEPAB and its
producers having a trading arm (until the recent intervention by the government there in the cotton
sector at least). Cotton companies need to be brought on board, while any new trading model
should be part of the existing governance structure and subject to regulations to reduce potential
conflicts. Above all, the various problems and interventions after crises caused by poor reform or
mismanagement highlight how much the cotton sectors in the C4 and Senegal need stability, which
only Senegal seems to have. Clearly, patterns need to be slightly different in each country but the
tripartite structure (government, producers, cotton companies) appears to be a good foundation for
reform.
Table 12: pros and cons of the different structure stakeholders and institutions in the C4 and Senegal
Item
Pros
Cons
Potential for Fairtrade and
sustainable cotton
promotion
National Producer Unions
Cohesive bodies,
democratic
Low capacity; subject to
internal politics
Strong; can promote to
producers and support
trading bodies
Local producer associations Cohesive locally
Low capacity
Strong in terms of outreach
to producers and supporting
extension and training
Inter-professional
associations
Equal representation of
stakeholders
Strong inertia is likely to lead Weak to moderate
to continued promotion of
high volume, intensive
production
Research
Quality of staff, and good
seed banks
Under-funded, ageing staff
Strong capacity to develop
seed for sustainable
production, if funded
Can be slow to react
Can provide suitable policy
framework and conditions
for growth
Government
Provide framework for
regulators/regulatory bodies sector
15 See aidenvironment Baseline Study of Fairtrade Cotton in West Africa, forthcoming, March 2016 for some emerging information
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Cotton companies
Experience and capacity
Focus on high volume and
intensive production
Sustainable options seen as
niche, and as small, are low
priority; often seen as a
source of donor funds,
rather than a strategic option
International traders
Know the market, and risk
management, as well as
logistics, buyers, etc.
As cotton companies
As cotton companies, with a
few exceptions, but can be
influenced by agents,
spinners and brands
AProCA
Position at continental level, Low capacity, lack of funding Strong motivation in this
member led
sector, well placed if
capacity is built to provide
information, lead overseas
trade missions, and lobby
national governments and
international bodies
Smoothing funds
Can stabilise sector
Could be costly and difficult
to sustain
A more stable sector would
also help sustainable
producers
A key question is: have reforms increased producer power in relation to the chain in the region and
each country – and if yes, has the power of the chain or sector in the region increased or
decreased? How can this be improved? In the case of Burkina Faso, reforms have increased
producer power. Firstly, by ensuring producer organisations became shareholders in cotton
companies. Secondly, seed cotton and input prices are fixed with participation by a cotton
producers' representatives. Third, the UNPCB president is also the AICB president, meaning
producers' viewpoints are taken into account at the AICB general assembly. Producer
representatives also participate in negotiations with government. Therefore, while producer power
is weak in certain areas like fibre sales and input procurement, it is stronger in strategy. Senegal
also functions reasonably well. But Benin, Chad and Mali are all facing many challenges.
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2. The role of Fairtrade certification and the challenges it faces
2.1 Fairtrade in West Africa
The number of producers involved in Fairtrade and Fairtrade-organic cotton has been growing in
West and Central Africa, but has been slowed by the lack of growth in Fairtrade sales.
In Mali, the process is supported by the international NGO Helvetas-Mali and local organisation
Mouvement Biologique Malien (Mobiom). Helvetas has supported capacity building for Mobiom,
and producer certification under Fairtrade and organic rules. Fairtrade has however not changed
the organisational structure of the cotton sectors, although it has helped build organisational
capacity (Benin is a slight exception as OBEPAB launched direct sales (in organic) a few years
ago; Burkina Faso and Mali also both now have trading service centres within UNPCB and Mobiom
respectively). In Senegal, there has been capacity building and employment of dedicated
technicians and representatives, with more regular meetings being held. In both Senegal and Mali,
Fairtrade has made the organizations more accessible to women. In Mali, Fairtrade cooperatives
exist and have been trained, although trainers are part of the MOBIOM structure. In the C4
countries and Senegal, all of the producer organisations are still overly dependent upon the sole
cotton companies in their respective countries.
Sales have been slow to grow, and the costs and logistics differentials between West African and
Indian cotton plays against African Fairtrade farmers. Indian producers enjoy proximity to a
manufacturing base, where little capacity exists in West Africa. Additionally, many countries suffer
lengthy logistics chains, which means time from order to delivery is too long, and there are
additional problems with border checks and customs in West Africa. This means that African
Fairtrade cotton is more expensive at the mill, despite being cheaper at the farm gate. Most
Fairtrade farming projects remain highly donor dependent (farming projects exist presently in Mali,
Burkina Faso, Benin and Senegal).
Senegal has the most supportive cotton sector, and Fairtrade-organic producer groups are now
affiliated to the FNPC alongside Fairtrade groups, after years in the cold. The purely Fairtrade
project has since its inception been run by SODEFITEX. However, SODEFITEX remains
concerned over lack of market growth for Fairtrade, and for a long time sat on large stocks. There
is good collaboration between the cotton company and national cotton producers federation. The
government in Benin has been promoting organic cotton since it took back control of the sector, but
what happens next remains unclear. In Mali, sustainable cottons are seen as projects, and not as
part of a cotton strategy.
Fairtrade-organic cotton suffers from being compartmentalised, and by not having dedicated gins
and supply chains, meaning there are costs and delays resulting from segregation, cleaning, poor
economies of scale, and so on. Fairtrade only cotton does not require machinery cleaning and
traceability is now easier under the new sourcing programme. There are also problems from poor
market information and forecasts, while access to finance and pre-finance is also a problem (this
may change however as the 2015 Fairtrade Trader Standard requires pre-financing of contracts to
enable small producer organisations to buy product from their members; provision of sourcing and
market information is also a requirement). The small size of most projects affects their ability to
manage and implement research or seed development, while productivity is a concern in most.
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So what can Fairtrade achieve through projects on the ground? It can show another possible world
with benefits to farmers. However, to gain support form institutions and policy makers, it needs to
show functioning markets, solid demand and long-term stability (a business case), where
producers can enhance their livelihoods, and cotton sectors can achieve greater stability and good
returns (although the absence of local processing at scale and the length of the value chains in
cotton are complicating factors). To date, the first part of this is only partially achieved, and the
second, business case part is not. Current field projects in West Africa do not show growing
markets and committed long term business partnerships, and not enough cotton is always sold.
This means Fairtrade cotton production in West Africa does not yet 'offer[s] a relevant and
credible baseline for resolving buyer power and unfair trading practices in agricultural chains'
(FTAO 2014). Much more has to be done to ensure better markets as well as to increase the
fairness of cotton sectors in the region.
2.1.1 Burkina Faso
Fairtrade cotton in Burkina Faso began in 2003, initiated by the French Dagris cotton company and
Max Havelaar, supported by the French Ministry of Foreign Affairs and the Centre for the
Development of Enterprise (CDE). The project goal was to improve farmer incomes, without
pretending to be a panacea for the wider sector. Sub-goals within targeted farmer groups were
building democratic institutions, gender and child labour, in line with Fairtrade principles.
UNPCB is a key partner in Fairtrade and organic, and has specific agents within it supporting
farmers, and also assists in marketing, notably in the agreement signed in 2006 with US brand
Victoria's Secret for organic fibre purchase. This contract is at a very high farmer price.
Fairtrade cotton is certified against the Fairtrade Standards by the single certifier FLO-Cert.
Fairtrade only cotton is produced by the SOCOMA cotton company, which includes 66 producer
groups (all from the Fada area provincial producer union, which is the certified unit). Benefits to
producers, and women farmers have been noted for this group, but less than half of available
Fairtrade cotton is sold as such. Premiums are only paid based on sales, so a lack of market
growth is a demotivating factor. Organic and Fairtrade cotton was launched in Burkina Faso in
2004. The project was set up to produce organic cotton for international markets, while supporting
more sustainable agricultural practices, more profitability and better livelihoods. Beginning in
2005/06, the project also promoted crops grown in rotation or the same farm system as cotton,
including sesame, sorghum, and shea nut (of which butter is the main product). The same season
saw the project also become Fairtrade certified, to capitalise on reported market demand.
The project is a partnership, built around UNPCB and Helvetas, with other stakeholders including
the Government of Burkina Faso, the three cotton companies, the Centre Ecologique Albert
Schweitzer (CEAS), the Institute of Environment and Agricultural research (INERA), German
development cooperation (GIZ), the trader Paul Reinhart SA, and the German company Hess
Natur. Donors include the Secretariat of State for Economic Cooperation of Switzerland (SECO),
the Directorate for Development and Cooperation in Switzerland (DDC/BUCO) and the Dutch
development NGO ICCO. A new programme with Catholic Relief Services (CRS) and funded by
USDA in 2013 began to look at improving productivity, diversification and trade.
Organic cotton is certified by Ecocert. The joint certification return is very profitable (for those
farmers whose cotton is sold), gaining two premiums.
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Table 13: Advantages and constraints of organic and fair trade cotton production in West Africa
Advantages
Constraints
-
Improvements in producer income and
decline in debt ratio (reduced costs).
-
Yields are low (400 – 500kg/ha) in Fairtradeorganic (but not in Fairtrade)
-
Suitable for small producers (0. 25-1 ha)
without access to credit (reduced risk);
-
Transport costs (distance of production areas
to gins) and lack of autonomy from
conventional sector
-
Cost of monitoring and supporting producers,
who are mostly inexperienced and whose
plots are remote from each other
-
A strong contribution to women's incomes
-
Ginning machinery needs to be cleaned to
process organic cotton
-
The use of organic manure improves grains
grown after cotton
-
Unavailability of organic manure in sufficient
quality and quantity, and low levels of farmer
equipment
-
Producers avoid poisoning and exposure to
hazardous products
Source: elaborated by the authors; Diallo, 2008; aidenvironment (2016, forthcoming)
Organic and Fairtrade are thus an interesting alternative for producers, but its impacts are
determined by demand in consuming markets. They may not be substitutes for conventional
cotton, but can offer an interesting niche market and an opportunity for the most vulnerable
producers as well as women – but commercial success is not guaranteed.
According to Mr Wilfried Yaméogo, the Permanent Secretary of the “Suivi de la Filiere Coton
Liberalisée” (Monitoring of the Liberalised cotton sector programme), there remains a problem with
how child labour is defined: there is still a misunderstanding between external bodies and producer
organisations, which consider some work carried out by children to be part of their education and
training, while (some) external bodies call this hazardous work for children (see Section 1.3 Child
Labour). The cost of certification remains very high, and must be paid each year. He also calls for
more organic inputs to be made available to producers, and an increase in the Fairtrade cotton
purchase price (purchase price + social premium).
2.1.2 Mali
Organic cotton began in Mali in 2002, promoted by Swiss NGO Helvetas. A local organisation,
Mobiom (Mouvement Biologique Malien, Malian Organic Movement) was established the same
year facilitated by Helvetas. MOBIOM promotes organic and more recently Fairtrade cotton,
defends producer interests, and provides capacity building for producers, supported by a large
technical department of over 40 staff. It is governed by a general assembly of 15 member
representatives, and supports work on sourcing, markets and business development. It became a
non-profit cooperative in 2007, with 73 local cotton producer groups as members, and 3 non-cotton
ones. The organisation operates in 8 zones, including 3 in the OHVN zone. CMDT provides some
support (collection and transport, export), and the organisation has also been supported by
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Geocoton and Max Havelaar.
There are two Fairtrade supply chains in Mali, both in the CMDT zone. One project, in Kita, is
Fairtrade alone, and includes 12 cooperatives. It is supported by CMDT, Geocoton and Max
Havelaar. The second, in Bougouni, is Fairtrade and organic, promoted by Helvetas Mali, Max
Havelaar Switzerland and Reinhart. It includes some 73 cooperatives and 6,500 producers.
Mobiom remains highly dependent on external funding, with Helvetas providing a large proportion if
its budget, and the rest funded by levies on sales. Mobiom has a goal of financial independence,
but this is not yet achieved. Recent disputes and fund misappropriation within the organisation
have caused serious problems. The sales levy has been increased to try to improve autonomy, but
plans are seriously delayed.
Mobiom's members include 10 producer groups in 8 zones, with most farmers having less than
1ha under cotton. As in other projects, lack of sales is the main constraint. A diversification policy is
focusing on sesame, fonio and shea nut butter, and there are plans to develop sesame oil
production.
2.1.3 Senegal
The Fairtrade cotton project started in as far back as 2003, with meetings with various actors
including Dagris, SODEFITEX, and Max Havelaar as well as producer organisations in Senegal
and other countries in the region. Actors met included organic producers already operating in
Senegal under an initiative first begun with PAN UK in 1994, and continued by ENDA-Pronat. In
2004, the Fairtrade standards were agreed, and Senegalese producers inspected, with the first
groups in Kedougou.
Fairtrade has had positive impacts in Senegal, but there are some weaknesses, such as the time
required for meetings, which can conflict with productive activities. Women members also
sometimes lack land of their own (this is not a matter of the standard requirements; women's lack
of access to land is a. general problem in the region, and many men also lack formal land titles).
Bachir Diop, the Managing Director of SODEFITEX, interviewed for this study says there needs to
be more forceful strategies in market development in Africa, and in linking producers to potential
customers, while the government should support development of small spinning plants.
2.2 Barriers faced by producers in marketing their Fairtrade cotton
Fairtrade cotton production expanded rapidly in the early years, with sales growing as well, but
market growth for Fairtrade, Fairtrade-organic and organic cotton came to a halt in 2008/09.
Problems were caused by the developing global financial crisis, over-optimistic predictions from
some promoters and NGOs, and a loss of confidence as a result by traders and cotton companies,
with access to business finance also a problem. Subsequently, confidence has not returned and
Fairtrade and organic projects are also now in competition with Better Cotton and Cotton made in
Africa, well-funded programmes with many brand and retail members. While the Fairtrade mark
remains well recognised, the cost of the fibre to brands is a major barrier, although it is hoped that
the new sourcing programme will render it more competitive. African Fairtrade also suffers in
competition with Indian Fairtrade, because of higher logistics costs and distance from the
manufacturing centres.
Producers also remain overly dependent on national cotton companies, international traders and
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international NGOs for market access.
The monopoly systems operating in the C4 countries and Senegal mean that producers have to
market their cotton through them, and in some cases they have also been locked into exclusive
agreements with NGOs or traders. In organic, the NGO OBEPAB in Benin did liberate itself from
this a few years ago, and set up Organic Benin to trade its cotton directly. While not a panacea,
given other constraints (capacity, finance), it has allowed the group to find new buyers and have
more options to trade. An expansion of this type of model, grouping several or all of the groups in
the region could perhaps allow a similar expansion of trade and access to new markets (and more
economies of scale), as well as ensuring competition between buyers, which could help improve
prices.
For other groups, expansion has been difficult. For example, for Mobiom in Mali, new markets have
largely been facilitated by Helvetas. But support from outside has helped in all countries, for
example with managing the quality of cotton, which helps secure Fairtrade markets. The Fairtrade
premium has also helped invest in improvements in infrastructure and production techniques. In
Mali, the premiums also helped farmers invest in organic certification, again, helping with market
access. But more needs to be done to support producers' direct involvement in marketing and
customer development, although we should not undervalue the achievements already made. That
said, business and marketing skills need investment, both in producer associations and in local
institutions and cotton companies. Better access to market information is needed, its absence
reflecting both lack of capacity and sometimes the gatekeeper role played by international
companies and NGOs. This is something also emphasised in the UNCTAD Road Map (2015),
which suggests the need to improve 'risk management techniques, links between producers and
buyers and information exchange', while the lack of local processing and poor infrastructure are
another constraint. It also emphasises environment and health, with the objective to ensure the
sustainability of African cotton, and the rational use of pesticides and other chemicals, so there are
many entry points here for Fairtrade and other sustainable cotton standards.
The C4 cotton companies are operating at a loss, and financial stability is strained by the volatility
not only in global conventional markets, but also in Fairtrade markets.
There needs to be a strategic vision for sustainability and Fairtrade – among cotton companies, in
governments, in regional institutions and policy. It also needs a strong position to compete with
newer sustainable cottons like BCI, even if collaboration with these programmes is also needed on
other levels.
2.2.1 AProCA perspective on Fairtrade cotton and Fairtrade-organic cotton
Youssouf Sidibé, the Permanent Secretary of Aproca agrees it is mainly in Senegal that there is
good support for Fairtrade cotton. In other countries, governments seem disinterested. In Mali,
Fairtrade is not at all a concern for CMDT; on the other hand, organic is done better by Mobiom.
Support by governments is very low, and agricultural policy does not take niche cottons into
account. Donors could lobby governments in the region for better inclusion of Fairtrade and other
options. Moussa Sabaly, who is the elected president of AProCA says governments must focus on
niche cottons. Fairtrade cotton is profitable for producers, and helps secure a better environment.
More lobbying is needed in the North, so that Fairtrade cotton is bought. The capacity of farmers
also needs building, with a stronger relationship between Max Havelaar and producer
organisations and between producer organisations and cotton companies.
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2.3 What governance structures support the spread of Fairtrade values and
practices
Producer organisations, and local NGOs (e.g., OBEPAB and ENDA Pronat, UNPCB, Mobiom)
have so far been the best vehicles for disseminating information about organic and Fairtrade
approaches, as they have the local connections with farmers. External organisations such as
Helvetas have been able to use partnerships to develop projects, and scale them by bringing in
funding – however, the focus on scale sometimes forgets about the need to grow markets, leaving
an over-supply problem. Cotton companies have generally played an implementing role, but this is
based on opportunity and funding rather than belief, with the exception of Senegal. Local NGOs
have often been sidelined by the entry of international actors, and more equal partnerships need to
be developed.
These seem to be the lynch pins for progress. Through these, as also suggested by UNCTAD
(2015), the inter-professional associations and AProCA seem to be the instruments through which
policy can be changed, based on what producers want. It is thus vital that Fairtrade Producers
have strong voices in Producer Unions, and that associations take on recommendations from niche
cottons. AProCA is already engaged with these programmes. UNCTAD (2015) also suggest that
the African Cotton Association (ACA), the African Cotton & Textile Industries Federation (ACTIF)
are other organisations which could 'build upon their respective national professional and inter
professional platforms, which could evolve into regional structures'. Organisations, associations
and others also need to lobby to ensure that Fairtrade, fair trading and sustainability are integrated
into regional (UEMOA…) and Continental (African Union) fora.
Another suggestion is to 'Rehabilitate and revisit the concept of product/sector negotiation roundtables in order to bring together producers, traders and manufacturers to discuss the sustainability
of agricultural chains and necessary trading conditions. These round-tables should be open
enough to ensure they do not create cartels of interests. Such initiatives have a long tradition (e.g.
in France) and have been recently reintroduced by several countries in the Global South such as
in Ecuador for the banana sector (UNCTAD 2015)'. However, these would need a very equal
partnership and power for producers, so other elements are needed first, for example capacity
building. Here, the Fair trade movements can intervene to support producers and to promote the
benefits of adopting better practices. Strategies need to take into account what governments want
from export crops like cotton: income, livelihoods, development.
Initiatives like the smoothing fund also offer opportunities, as producers can work in more stable
conditions. When market demand falters, Fairtrade producers can also still benefit.
2.3.1 Moving potential blockages
Blockages in governments and cotton companies can be removed by negotiation and
demonstration (of impacts, of potential benefits to balance of payments and exchequers); other
blockages, e.g., gatekeeper roles need changes in the governance of niche sectors and building
capacity for self-management and autonomy by local partners, especially those created by and tied
to programmes led from outside, or by cotton companies.
2.3.2 Best practices in West Africa
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Table 14 : Best and better practices in support of Fair Trade
OBEPAB, Benin
Federation YNW
Best (or better) practice
Improvements required
Recommendations
Trading entity, trading
independently
Capacity (volumes too small A model that can be built on,
to support fully professional for all Benin projects and
staff)
even regionally, to achieve
scale of sales and improve
Access to cash flow finance offer to customers (better
(affordable)
volumes)
Development of new pest
management tools leading
to improved yields (30%)
More finance – donors funds
in short term, producer
levies when volumes are
sufficient
More collaboration with
national research; more
regional collaboration and
research; more collaboration
with other sustainable cotton
initiatives will lead to better
scale and so more finance.
Organisation of independent Lack of market access
producer organisations;
Sidelined in cotton sector
Entry into formal FNPC
Need capacity to find more
Have found customer in
customers
Belgium, and negotiated
own price and contract
More integration in cotton
sector
Begins process of
independent trading
Overly bureaucratic set-up;
slow decision making
More autonomy and ability
to take decisions on sales
Partnership with Victoria's
Secret brand
Need more clients
Seek similar partnerships at
regional level, supported by
AProCA
Mobiom
Growing to independent
trading
Internal management
problems
More professional
management and sales
autonomy
SODEFITEX Fairtrade
Strategic approach to niche
cottons
Lack of markets, lack of
Better market information
support from external actors systems and client
on Fairtrade markets
introductions from global
Fair Trade movement
Train more producers on
Fairtrade
AproCA to see if model can
be replicated in WA with
Improve Fairtrade marketing others
and organisation
UNPCB trading office
Fairtrade promotion in
cotton areas
More regional trade
cooperation
2.3.3 Government policy
No government in the C4 and Senegal has adopted specific Fairtrade policies, although there are
moves in the AU to include sustainability policies. This is an open door into which Fairtrade needs
to push for inclusion, focusing on areas that might benefit African trade, such as child and forced
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labour, certification of work practices and health and safety in farms and factories, for example.
Also important are foci on quality, profitability, sustainability, resilience, and net balance of payment
impacts as opposed to income – i.e., can fair trade policies and other sustainable interventions
lead to higher incomes for countries. Fair trading can also lead to opportunities for diversification –
where cotton leads, other products can follow, especially if infrastructure is improved. New policies
could also lead to more business and investment friendly frameworks in business law or banking
practices, to support development of new businesses and business models supporting increased
trade and exports.
2.3.4 Regional policy
Improved regional legislation could also make it easier to develop regional supply chains, i.e.,
spinning fibre in a different country, something difficult to do at the moment in the C4 and Senegal,
let alone, for example, being able to ship fibre from the C4 and Senegal to East Africa (Tanzania,
Uganda, Ethiopia, Mauritius...), all countries that import fibre, with established or growing textiles
industries. National governments could do more negotiating here, but AProCA are already in touch
with the ACA and ACTIF, and can provide an impetus, lobby, research and promote the potential,
also working with regional and continent wide bodies like the AU.
2.3.5 International partnerships
There are various initiatives from governments and international agencies in West Africa, focusing
on value addition. However, given the small size and under performance of existing industries, the
costs of plant, and the energy supply problems in the region, it is not clear there should be much
focus in the short term on textiles processing from a fair trade point of view, although it makes
sense from a long term perspective, if reliable and affordable energy supply can be developed in
the region, alongside reliable and affordable logistics. However, the short term should focus on
reliable supplies against long -term business partnerships of fairly trade raw material to global
markets, with some attention to artisanal and small scale processing where quality can be assured.
Here, the experiences of Burkina Faso with Faso Dan Fani, and some work in Senegal working
with textiles designers can be harnessed. Initiatives like Africa Fashion Guide, which focussed on
promoting the work of African designers and manufacture in textiles can be useful16.
2.3.6 Research
Agricultural and cotton research institutions in the region have the skills, knowledge and
seed/germ-plasm banks to support more sustainable practices through adapted seed and
developing sustainable farming practices, but are under-funded. With the impacts of climate
change growing, cotton farming needs adapted and resilient seed, preferably needing fewer inputs.
Collaboration with other initiatives to support research would make sense (Fairtrade, organic, BCI,
CmiA). It is urgent to secure sustainability of future production by addressing various problems
such as soil fertility, independence of local research and seed breeding, reduction in environmental
damage, security of livelihoods, reduced fragmentation of land holdings, improved rights to land
use and tenure.
Unfortunately, Producer Organisations are still captured in a vision of intensive production – should
more freedom over production methods and even seed be devolved (although seed is an issue as
countries try to export consistent seed characteristics)? At least some devolution on production
16 http://www.africafashionguide.com/
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methods, certification schemes and diversification could be considered even if quality and seed
characteristics still need some central coordination.
2.3.7 Finance
Banks and other credit institutions are also bodies which could support more sustainable and fair
practices, if the policy framework supports it. More capital could lead to more investment, and
support moves for example to maintain supply of Fairtrade cotton, and to pre-finance growth
against demand, secured through contracts or other means.
2.3.8 AProCA
AProCA could support and promote a lot of initiatives and campaigns, but is short staffed and
under-funded. It might be possible however for them to get staff seconded for specific activities,
whether from traders, financial institutions, cotton companies or producer organisations, as well as
IT companies to develop information systems, for example. International brands buying in West
Africa might also have something to offer.
2.3.9 Producer organisations
POs need time to spend on Fairtrade and other initiatives, and to be able to support change. This
applies to POs at local, regional and national level as well as to AproCA. Time means money, but is
essential to free resources to improve practices, to nurture economic benefits to farmers,
communities and governments. Potential supporters of more Fairtrade and fair trading also need to
see change in action, in order to lobby for appropriate government policies. From this could follow
moves for Producer organisations to set up of trading cooperatives, owned by producers, but
perhaps (indeed, ideally) employing professional managers and staff with the right skills to lead
marketing, promotion and quality control.
2.3.10 Subsidies and interventionist policies in other countries
Of particular importance for fair trading would be for the C4 and Senegal to resist further pressures
for reform and liberalisation from outside as long as rivals and richer nations continue to support
their cotton sectors. They should also lobby for the same kind of compensation received by Brazil,
and that any aid in kind, such as donations of plant or seed come with technical training and
support.
2.3.11 UEMOA interventions in the West African Cotton sector
The commission of the West African Economic and Monetary Union (UEMOA) is an economic
integration body set up in 1994 between 8 West African countries (Benin, Burkina Faso, Côte
d’Ivoire, Mali, Niger, Senegal, Togo, Guinée Bissau). As cotton is one of the most important
commodities in the region, UEMOA developed programmes to address sector constraints. These
include interventions on the consequences of deteriorating terms of trade, and especially the
distortions caused by subsidies paid to producers in Western countries.
Three important initiatives have been developed by the UEMOA commission in West African
cotton, namely: the cotton-textiles agenda, PAFICOT and the Fairtrade-organic cotton collaboration
with the Bretagne region of France.
The Cotton-Textile Agenda
The Agenda for the competitiveness of the Cotton & Textiles sector of UEMOA was initiated in
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2003, following the complaint by the C4 to the WTO. Its objective was to ensure value addition for
25% of fibre production by 2010, creating 50,000 jobs in industry. However, the deadline passed
without any concrete signs of the target being met. The agenda was then revised in 2010 to a
deadline of 2020 (this reinforces the point made above about how much effort in the short term
should go on value addition strategies).
The agenda in its current form includes 5 strategic objectives:
-
Improve the productivity of cotton-textiles supply chains in the UEMOA region
-
Improve the quality of cotton in the UEMOA region
-
Support the development and promotion of cotton and textiles in the UEMOA region in
regional and international markets
-
Develop local processing of cotton fibre
-
Support development and promotion of the cotton seed oil chain
AProCA has been involved in the implementation of the programme and in key activities.
PAFICOT
The Support Programme for the Cotton-Textile Supply Chain (PAFICOT) was developed by
UEMOA out of the Cotton-Textile Agenda. It has been active since 2007 in the C4 countries (Benin,
Burkina, Mali, Chad), but not Senegal. It is funded by the African Development Bank with
objectives to secure and improve the revenues of stakeholders in the cotton and textiles sectors in
a sustainable way, and to stimulate local cotton processing. Its specific objectives are grouped into
four headings:
- Improve the production conditions for seed cotton in productivity, cost reduction,
environmental impacts, human health impacts and cotton quality.
- Improve revenue distribution in the sector by improving producer negotiation capacity
- Create a competitive framework for seed cotton chains, for textiles and cut and sew.
- Improve marketing of seed cotton and cotton lint
We can also see here that producer income and their negotiation capacity are priorities. Thus,
there are actions on capacity building for AProCA. The second objective aiming to improve
producer revenues shows UEMOA progressing towards sustainable cotton initiatives, especially
Fairtrade cotton.
Fairtrade-organic Programme
Organic and fair trade production became a reality in West Africa from 1994 at Koussanar in
Senegal and in Benin in 1996 (Fairtrade certification arrived later). Programmes were later
extended to Mali and Burkina Faso (and for a time to Cameroon). Organic and Fairtrade cotton has
been supported by several organisations and donors. In particular, UEMOA has supported the
strengthening of the organic Fairtrade project in Mali by facilitating cooperation with the Bretagne
region of France. Fairtrade-organic production from Mali and Burkina Faso is purchased by five
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French manufacturers in Bretagne, who market the finished products in France. Between 2008 and
2010, 4,800 tonnes of organic Fairtrade cotton were bought in Mali and 1,175 in Burkina Faso.
This should have contributed to improving the livelihoods of at least 5,300 producers in both
countries.
As well as the contribution from French Development Cooperation of which AProCA is the
implementer, It is also involved in the UEMOA initiative. AProCA is a critical organisation whose
presence in these fora ensures the views and interests of producers are taken into account.
However, the capacity building of AProCA to date is still insufficient given the many roles it already
has. Thus, to ensure organic and Fairtrade cotton is delivering the benefits expected, more
capacity building should be offered to AProCA, to support its structures and capacity, especially in
lobbying and advocacy.
Support by UEMOA to the Fairtrade-organic cotton sector is also a good way for producers to gain
more advantages from their geographic position, and achieve their priority to reduce poverty.
AProCA can lobby UEMOA to get a directive or regulation leading to governments paying more
attention to sustainable and niche cotton in future.
2.3.12 African Union
Although the African Union (AU) has no specific cotton programmes, it has not stayed away from
debates concerning cotton. The various commercial agreements which affect trade between Africa
and the rest of the world have attracted the attention of the AU commission, which has helped
various regional economic Unions (CEDEAO, COMESA and SADC) gain a voice, especially at the
WTO. The AU is in particular a stakeholder in the Steering and Monitoring Committee for Cotton
(COS Cotton), which was initiated in 2004 in the EU-Africa cotton partnership17, to prepare African
actors for commercial negotiations. This is to help them better defend the interests of stakeholders,
and especially producers. During the 20th meeting of the COS Cotton in Cotonou in March 2015,
one recommendation was to support the wish of members to develop a cotton agenda for the AU,
in order to take the whole sector into account (including development and the textiles industry).
The social and environmental problems of the sector are also taken into account by the AU
Commission. It has an active programme on child labour, an area in which cotton weighs. Further,
within the CAADP (Comprehensive African Agriculture Development Program), the Commission
supports a programme called EOA (Ecological Organic Agriculture), which aims to encourage
countries to institutionalise organic and ecological practices in their agricultural development
policies. Cotton is one of the crops considered here in order to reduce the environmental impacts
of its production.
2.3.13 OHADA
The Organisation pour l’Harmonisation en Afrique du Droit des Affaires18 (OHADA, or Organisation
for the Harmonisation of Business Law in Africa) is active in 17 African countries (Bénin, Burkina17 The
EU-Africa Partnership on cotton was concluded between the EU and African countries in July 2004
(Paris Forum). Its global aim is to “enhance the competitiveness, added value and viability of the African
cotton sector, so as to maximise the impact on local producers' income”. While the current version of the
ACP has seen its sustainability efforts focused on COMPACI and BCI, rather than Fair Trade and organic
cotton, there is scope to include more in the new round due for development in 2016. Recommendations
are covered in Section 4.7
18 See more at http://www.ohada.com/accueil.html
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Faso, Cameron, Central African Republic, Côte d'Ivoire, Congo, Comores, Gabon, Guinée,
Guinée-Bissau, Equatorial Guinea, Mali, Niger, Democratic Republic of Congo, Senegal, Chad and
Togo). Under this process, a unifying law relating to cooperative societies became a reality in 2011.
It is a great help in strengthening the governance of Producer Organisations (including those
involved in cotton). It is the proper application of the law's stipulations that is the subject of debate.
Various interpretations have led to dysfunctions, especially in Mali, with controversy over the
renewal of the mandates of elected farmers.
Informed observers of the corporate life of producer groups recognise the value of producers and
their organisations. However, poorly governed organisations are not to the benefit of most
producers. If there are genuine difficulties in implementing the law (especially financial), AproCA
needs to become more involved in monitoring it, and raising awareness of producers in West
Africa.
2.3.14 Other international initiatives
While there are few concrete pro-sustainability cotton policies in place that could help fairly traded
cotton from West Africa, there are various schemes and initiatives that offer ideas. The most
obvious, and with some existing examples, is to use public procurement to enhance demand, or
other demand models, such as the already mentioned cooperation with Region Bretagne. Sourcing
of Fairtrade-organic cotton for police uniforms in Switzerland is also already a reality. Thus, a push
to make sure fair trading is part of EU procurement rules is worthy of attention, as could be
attempts to work with cities or states in the US (e.g., Berkeley, Seattle, Portland...strongly Liberal
cities).
But there are also models that could be used to develop cotton legislation, in this case, the EU
timber regulation. This regulation came into force in 2013, and sets out to eliminate illegally
harvested timber and timber products onto the EU market (FSC, 2015). The regulation requires
organisations to ensure they have practices in place to ensure this (it bears some similarities to the
Modern Slavery Act in the UK). It is essentially a due diligence requirement. The US already has
guidance for cotton based on where labour abuses are common, but an EU cotton regulation could
do much to promote sustainable cotton and fair practices, for example by requiring some
disclosure of origins for fibre. Sustainable cottons could also receive some access benefits such as
reduced duties, where cotton without any guarantees of good practice could be banned or
penalised.
Companies could also take a lead on sourcing from the C4 and Senegal, but few seem willing to
consider this. However, stimulating shareholder advocacy, a common enough practice today, could
be a way to improve market access in the C4 and Senegal. Fair trade promoters and supporters
could lead campaigns on this, seeking allies among brand shareholders, or becoming shareholders
themselves. This could be done in conjunction with consumer awareness campaigns by AProCA
and NGOs. Opportunities may exist also to work with international organisations like the
International Cotton Advisory Committee, whose new metrics for cotton are being piloted among
other countries in Benin. Collaboration by sustainable cotton programmes could help benchmark
performance, while increasing the power of sustainably certified producers in international debates
on cotton.
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3. Conclusions
Cotton production in the C4 countries and Senegal has had many years of ups and downs, with
production overall increasing, but declining terms of trade, rising costs of production and inputs,
and so an overall poor performance, exacerbated by policies and actions elsewhere, notably on
subsidies. Much that could have been in terms of development and improved rural livelihoods has
thus not come to pass, while the introduction of sustainable and Fairtrade production has yet to
occur on such a scale as to make a dent in the prevailing poverty among cotton producers,
communities and workers.
There has been progress on producer power within cotton sectors with the creation of Producer
Organisations, a regional body (AproCA) and producer participation in sector governance and as
shareholders in cotton companies. However, the real power on West African cotton lies in global
markets and prices and policies. The power that could lead to change, brands consciously buying
and sourcing in the C4 and Senegal, has yet to come to pass. Thus there are twin strategies for
improving the situation: one is continued lobbying for change by producers and local stakeholders
in the C4 and Senegal, and the other to promote cotton from the region that meets sustainable and
Fair criteria to brands, to build a demand alliance for it. A possible third option is also to lobby for
change, targeting first countries that distort the market (USA, China, India), and secondly bodies
that can lead to substantial change (EU, G7), and donors willing to support sustainability or
campaigns.
There is also much to do in Africa. In terms of policies, this means improving further participation
by producers, as well as embedding sustainability into the sector – including ensuring economic
security by looking to improve price stabilisation mechanisms and making more use of forward
contracts to secure assured and thus predictable prices, to enable solid and long term financial
planning, as well as the security that keeps farmers in cotton. But farmer livelihoods and economic
development can also be assured by more diversification, embedding cotton within a system where
it is no longer the only reliable cash crop. It is also important to build the capacity of local producer
organisations, but also of local NGOs and businesses.
Removing bottlenecks and gatekeepers between local actors and the market is also vital, and this
could be done by creating dedicated fair and sustainable trading entities working with the cotton
sector and its governance structures. Governments must also act to remove barriers to trade within
Africa, to enable development of cross-border value chains as well as to make exports easier from
landlocked countries.
A report for the Fair Trade Advocacy Office
59
Power in West African Cotton Supply Chains
4. Recommendations
The recommendations below are aimed at policy makers in national governments and the AU, and countries in the EU and G7, as well as the Fair
Trade movement, and NGOs engaged in cotton. They cover both structural questions (e.g., governance and institutions) and possible interventions
(building support for Fair Trade, improving Fair Trade implementation and development of Fair Trade strategies).
Each recommendations section includes a summary and a detailed table showing actions, its time-scale and urgency, and which stakeholders need
to be involved.
4.1 Production
Recommendations on production focus on the strategies of cotton production (quality and profitability first), the roots of good yields (soils and seeds),
and diversification (more livelihoods opportunities for producers). They then focus on the Fairtrade and sustainable cotton sectors, to look at
improving trading and market access, support to producers, collaboration and more producer participation in designing production systems that work.
Action
Time-scale
Fair Trade
movement
Focus on quality,
profitability,
sustainability,
resilience, not
volume and yield
alone, to support
producers as well
as cotton
companies (see
Section1)
Short to long-term Support quality
drive by
programmes
Emphasise and
support
sustainable
production by
supporting
-research and
dissemination
A report for the Fair Trade Advocacy Office
Local
National
stakeholders
Governments
(e.g., producer
groups, AProCA)
Regional and
Pan-African
institutions
Work to
demonstrate
benefits in terms
of balance of
payments and
cotton company
bottom line
Make sustainable
production an AU
and UEMOA
strategy
Ensure sufficient
funding of cotton
research and
Ensure
sustainability
research is a core
activity
International
Institutions and
NGOs
Donors to support
African cotton
research and
focus on quality,
profitability,
Promote results in sustainability,
external promotion resilience
of regional
commodities
Reserve funding
(Africa Cotton:
for Fair and
Fair and Clean,
sustainable
EU
G7
Support research
with funding and
Promote
investment in
Africa – Trade and
Aid
Support fair and
sustainable cotton
through
procurement
programmes and
other measures
60
Power in West African Cotton Supply Chains
Improve soil
fertility (See
Section 1)
Immediate action
(soil fertility,
already poor, is
rapidly declining,
and erosion
increasing)
e.g.)
interventions
alone
Ensure sharing of
information
between national
research
institutions
Support:
knowledge and
funding
Push for relevant
actions and
policies with
governments,
cotton companies,
donors and others
Ensure action and
investment by
revising regulatory
frameworks
Invest in resilient, Immediate for
Advocacy
locally adapted
medium/long term
seed |(whether for results
sustainable cotton
or for adding Bt
genes) (See
Section 1)
Need funding:
POs, cotton
companies,
research
institutions (levies)
Ensure seed
research is in
policies, and
funded
Cotton
diversification
through crop
rotation and
valorisation of
whole farm output
to improve farm
sustainability and
producer and
worker incomes
(See Sections 1
and 2)
Investigate
programmes to
use sustainable
food for example
in school meal
programmes (exist
in some East
African countries)
Investigate
Remove barriers
programmes to
to trade between
use sustainable
African countries
food for example
in school meal
programmes (exist
in some East
African countries)
Immediate action
for
promotion/lobbyin
g, long term
planning for large
scale results
Support marketing
of crops with
potential markets
in organic,
Fartrade, WFTO
and other projects
A report for the Fair Trade Advocacy Office
Offer support and
advice and
training on market
access and
requirements
Offer support and
advice and
training on market
access and
requirements
Plan for
development of
infrastructure for
other commodities
to match cotton
infrastructure
(processing,
61
Power in West African Cotton Supply Chains
transport, storage,
marketing) with
private sector
Develop national
and regional
trading platforms,
owned by
producers,
separate from
cotton companies
but regulated by
and participating
in cotton sector
regulation (See
Section 1 and 2)
Immediate to
medium term
Support capacity
building and
development
Develop business
plans
Create legal
framework within
cotton and other
regulatory
frameworks
Facilitate access
to capital
Promote
investment by
large investors
and funds
Identify skilled
staff
Invest in extension Immediate
and training –
many programmes
have poor
productivity, low
yields (See
Section 1 and 2)
Collaborate with
other sustainable
cotton initiatives:
information
sharing for
example on
Promote and
lobby for idea
Immediate
Support training of Ensure national
agents, lead
systems are
farmers
supported and
funded
Respect best
practice
Establish
guidelines for best
Ensure sufficient
practice (working
and qualified staff with other
(cotton
stakeholders)
companies)
At high level –
exchange and act
on common
interests (lobby,
advocacy,
A report for the Fair Trade Advocacy Office
Producer Unions
and AProCA –
information
exchange, even
sharing technical
Support and be
willing to pay for
extension
(companies and
international
promoters)
Host forum
perhaps via
regulatory
agencies/interprofessional
62
Power in West African Cotton Supply Chains
research,
extension best
practice, lobbying
where common
interest exists
(Section 2)
communications)
Initiate dialogue
with producers
over production
goals, methods,
strategies – what
alternatives to
uniform, mass
production vision?
(Section 1)
staff and tools
associations
Take part, survey Participate, listen,
producers, present amend strategies
results
Adopt policies
supportive of
producer needs
Work with POs
and others to
manage producer
needs and support
4.2 Further research
Recommendations in this section address gaps in knowledge that need to be cleared. Producer groups involved in Fairtrade cotton are often
disconnected from markets, and from market information, which is a factor in low volumes of Fairtrade cotton sold, as new clients need to be found.
Another knowledge gap is over the potential impact of trade deals, notably bilateral deals which may slow or sideline processes at the WTO. Another
knowledge gap is over the potential macroeconomic benefits of more sustainable cotton farming, for example through reduced use of imported inputs.
Action
Time-scale
Fair Trade
movement
A report for the Fair Trade Advocacy Office
Local
National
stakeholders
Governments
(e.g., producer
groups, AProCA)
Regional and
Pan-African
institutions
International
Institutions and
NGOs
EU
G7
63
Power in West African Cotton Supply Chains
Market research
(Section 2)
Immediate
Disseminate
information of
sustainable
markets and
opportunities
Impact of
Immediate
international trade
deals (WTO, TTIP,
TPP, etc.) on C4
and Senegal
(Section 1.2)
Commission
research
Push for attention Immediate
to multilateral
trade deals that
include LDCs and
address their
problems (Section
1.2)
Campaign
Calculate and
Short to medium
promote potential term
economic benefits
of large scale
Fairtrade/organic:
reduced imports,
Higher profits,
more tax revenues
(Sections 1 and 2)
Support
AProCA: Maintain
information
resource,
disseminate
information to
members
Companies: share
information and
research
Evaluate impacts
Evaluate impacts
EU
G7
Campaign
A report for the Fair Trade Advocacy Office
Take part in
research, and
advocacy on
results
Act on results
Act on results
Promote results
Support research
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Power in West African Cotton Supply Chains
4.3 The Fair Trade movement
Recommendations to the Fair Trade movement include those designed to back up suggested actions in the region by governments and others
(campaigns around subsidies, consumer awareness, creating a demand alliance, promoting the new Fairtrade textile standard and campaigning
against companies with poor records).
Action
Time-scale
Fair Trade
movement
Local
National
stakeholders
Governments
(e.g., producer
groups, AProCA)
Regional and
Pan-African
institutions
International
Institutions and
NGOs
Campaigns: no
Immediate
liberalisation in
WA without reform
to subsidies and
cotton support
elsewhere and
compensation for
losses (Sections 1
and 2)
Lead campaign
Support
Support in
international
events
Support
Support
Consumer
awareness
(Section 2)
Campaign and
promote fair
trading and
consumption of
products made
with fairly traded
cotton
Provide
information and
material to
campaign
Take part
Take part
Take part
Promote African
investment
Take part
Short to medium
term (when supply
is beginning to
enter markets)
Build a demand
Immediate
alliance for fair
traded cotton from
the C4 and
Senegal (Section
Sign up brand
supporters to buy
Fairtrade
A report for the Fair Trade Advocacy Office
EU
G7
Join events
65
Power in West African Cotton Supply Chains
2)
Promote the new
Fairtrade Textile
Standards
(launched March
2016) to increase
Fairtrade cotton
use (Section 2)
Campaign against
companies caught
in bad practices,
including on new
modern slavery
and child and
forced labour
(Section 2)
Lead; all national
Fair Trade
movements
Medium to long
Monitor
term (it will be
information
hard to link brands
to C4 and Senegal
cotton)
Back
Monitor
information
Legislate for
disclosure of
information on
ultimate buyers of
their cotton
Legislate for
disclosure of
information on
ultimate buyers of
their cotton
Push for
disclosure of
information on
ultimate buyers of
their cotton and
transparency in
cotton supply
chains
Push for
disclosure of
information on
ultimate buyers of
their cotton and
transparency in
cotton supply
chains
4.4 Capacity building
Capacity building recommendations are aimed at producers, women producers, producer groups, and local producer focussed organisations
(AproCA). Recommendations focus on farmer owned trading, capacity building for AproCA, and for producer representatives, women's groups and
producer organisations, aiming to improve their capacity to engage with markets, institutions and cotton sector platforms.
Action
Time-scale
Fair Trade
movement
A report for the Fair Trade Advocacy Office
Local
National
stakeholders
Governments
(e.g., producer
groups, AProCA)
Regional and
Pan-African
institutions
International
Institutions and
NGOs
EU
G7
66
Power in West African Cotton Supply Chains
Support
Immediate start
development of
farmer owned
trading companies
(Sections 1 and 2)
Support
Support: business Back and amend
plan, capacity
cotton sector
building
regulation
Support
Build capacity of
Immediate
AproCA in
advocacy,
lobbying, market
information,
promotion and IT
(Sections 1 and 2)
Support/fund
Take part
Support (funding,
in-kind, e.g.,
secondments)
Build capacity of
Immediate
Producer
representatives to
participate in
cotton company
work, in interprofessional
associations and
in AProCA –
especially small
farmers, women
and minorities
(Sections 1 and 2)
Support
Implement
Build capacity of
producer
organisations in
fair trading and
related
certifications and
Implement
Immediate
A report for the Fair Trade Advocacy Office
Finance
67
Power in West African Cotton Supply Chains
criteria (Section 2)
Women's groups
(for roles in POs
and to take
advantage of
diversification
options) (Section
2)
Immediate
Support
Implement (POs,
AProCA, local
NGOs)
4.5 Markets & Finance
Recommendations on markets and finance deal with market information gaps, closer collaboration with physical cotton traders, the need to bring in
more investment, value addition, the need to have direct relationship with cotton spinning mills and improving government oversight and facilitation of
private sector involvement.
Action
Time-scale
Improve market
Immediate
information (niche,
sustainable and
global) to local
stakeholders,
producer
organisations and
producers
Fair Trade
movement
Local
National
stakeholders
Governments
(e.g., producer
groups, AProCA,
cotton
companies)
Provide
information
Seek, analyse and
disseminate
information
A report for the Fair Trade Advocacy Office
Regional and
Pan-African
institutions
International
Institutions and
NGOs
EU
Provide
information
Provide
information from
EU research
G7
Build IT and
communication
systems
68
Power in West African Cotton Supply Chains
(Section 2)
Work with small,
still physical
traders: Plexus,
Devcot – explore
use of forward
contracts in
sustainable
cottons to secure
prices (Section 1
and 2)
Medium term
Use markets to
stabilise prices
and income
Investigate
whether ethical
investors could
invest in these or
in existing cotton
companies to
support Fairtrade,
organic cotton
(Rabobank, Root
Capital). This
should include
exploring all and
any options for
more value
addition to create
income and
employment
(Section 2)
Immediate to
medium term
Support
Build more
relationships with
Short to medium
Support
A report for the Fair Trade Advocacy Office
Implement and
promote
Implement
(AProCA, cotton
Support
Support
69
Power in West African Cotton Supply Chains
Mills – e.g.,
term
Turkish companies
often enquire
about African
cotton but rarely
have direct
connections
(Section 2)
companies)
Seek
Immediate
commitments for a
demand alliance
of traders, buyers
and consumer
groups…and
campaign and
promote it
(Section 2)
Lead
Support
Support
Facilitate more
Medium to long
private sector
term
participation but
better government
regulation/oversig
ht (investment in
plant, equipment,
efficiency,
diversification,
processing)
(Section 2)
Support
Promote and
Support
create appropriate
legal and financial
frameworks
Invest
A report for the Fair Trade Advocacy Office
70
Power in West African Cotton Supply Chains
4.6 National governments (in West Africa and in consumer countries that purchase form them or are potential markets)
Recommendations in this section are squarely aimed at policy makers in West Africa, with a view to pushing for explicit laws and policies in support
for Fairtrade, and Fair Trading. As well as the adoption of supportive policies for sustainable cotton and its trade, recommendations cover the problem
of subsidies, foreign aid, including in-kind, and barriers to trade.
Action
Time-scale
Adoption of
Short to medium
specific
term
sustainable cotton
policies and Fair
trading laws and
practices by
national
governments,
including actions
to redress
imbalances of
power (Section 1
and 2)
Fair Trade
movement
Local
National
stakeholders
Governments
(e.g., producer
groups, AProCA)
Regional and
Pan-African
institutions
Promote
Advocacy and
lobbying
Adopt legislation
Adopt policies and
legislation
Lead and act
Support
Create space for
Fairtrade and
other sustainable
options – nurture
economic benefits
to farmers,
communities and
governments
A report for the Fair Trade Advocacy Office
International
Institutions and
NGOs
Support and
promote in
activities
EU
G7
Promote in
regional activities
Promote
and in
procurement
Promote
consumption
71
Power in West African Cotton Supply Chains
(Section 1 and 2)
State can also
Short to medium
favour
term
liberalisation
through supporting
alternatives
including trading
coops with 80100% producer
ownership – but
professional
management and
staff (Section 1
and 2)
Analyse benefits
to cotton
companies
Lobby and
Adopt in cotton
promote (POs and sector regulatory
AProCA)
frameworks
Analyse benefits
to cotton
companies
Invest in
infrastructure,
energy and
processing and
create appropriate
regulatory
frameworks
(Section 2)
As long as rivals
Immediate
and richer nations
offer policy and
export support and
subsidies, C4 and
Senegal should
resist externally
imposed reforms
that limit their
Support
A report for the Fair Trade Advocacy Office
Support
Campaign
Campaign
Lobby EU to
support
G7 should
campaign for
global reform and
action
72
Power in West African Cotton Supply Chains
ability to support
cotton sector
(Section 1)
Ensure foreign 'in- Medium term
kind aid' comes
not just with kit but
with training and
skills – e.g.,
factory equipment,
seed – needs
know how
(Section 1)
Local barriers to
Immediate
trade – removal
imperative to
support both local
trade development
and regional value
addition and
international trade
(Sections 1 and 2)
Lobby
governments
Lobby
governments
More stringent
controls and
transparency on
aid in-kind
Monitor
Lobby
governments
Open barriers
Push more
opening of borders
within Africa
Participate in AU
and other regional
processes to
improve interAfrican trade
Support policy
process and
negotiations
Support policy
process and
negotiations
This includes
looking at
transport
infrastructure and
development,
including
coordination of
road, rail and port
transport and its
development for
A report for the Fair Trade Advocacy Office
73
Power in West African Cotton Supply Chains
ports such as
Abidjan, Dakar,
Cotonou, etc.,
Back initiatives to
develop textiles
processing
capacity and
integration of
Fairtrade and
sustainable raw
materials (Section
1 and 2)
Back
Back
Lead
Back
Back
Back
Back
4.7 EU
Recommendations to the European Union focus on supportive actions and policies for research and trade, as well as compensation for the impacts of
subsidies.
Action
Time-scale
Fair Trade
movement
Local
National
stakeholders
Governments
(e.g., producer
groups, AProCA)
Support
campaigns and
policy research by
C4 and Senegal
and compensate
for losses (Section
1 and 2)
Immediate
(support,
research) to
medium term
(compensation)
Lobby
Lobby
A report for the Fair Trade Advocacy Office
Lobby
Regional and
Pan-African
institutions
International
Institutions and
NGOs
EU
G7
Support research
and agree
compensation
74
Power in West African Cotton Supply Chains
Support trade in
Immediate
fair and
sustainable cotton
and textiles
(Section 2)
Support
investment in
infrastructure and
the textiles
industry
Lobby and
research potential
support
mechanisms
Investigate fiscal
measures to
support fair traded
cotton and
sustainable cotton
Include fair and
sustainable criteria
in procurement
rules
Long term
The EU should
Immediate action
prioritise support
under the next
phase of the ACP
towards the AUs
efforts to develop
its own cottontextiles agenda, as
well as to
including more
focus on
supporting Fair
Trade and
sustainable cotton,
with a view to
improving
livelihoods and
protecting the
production base
(soil, water,
landscape…). This
focus should be
strictly integrated
Lobby
A report for the Fair Trade Advocacy Office
Lobby
Lobby
Lobby
Lobby
Implement
75
Power in West African Cotton Supply Chains
with relevant EU
activities such as
on public
procurement.
The EU should
Immediate action
seek to ensure
funding is more
cross-cutting and
not single
programme
focused (e.g.,
CmiA, BCI, IPPM)
to ensure there is
funding for all
sustainability
initiatives and
proper sharing of
useful information
and research.
Lobby
Lobby
Lobby
Lobby
Lobby
Implement
The EU should
Immediate action
also ensure
African cotton
research sectors
are funded, based
on African defined
(with producer
input) research
needs, and not on
supporting
imported
technology (see
the problems with
Lobby
Lobby
Lobby
Lobby
Lobby
Implement
A report for the Fair Trade Advocacy Office
76
Power in West African Cotton Supply Chains
Bt cotton in
Burkina Faso).
4.8 G7
Recommendations to the G7 focus on collective action on trade inequality and the need for them to rank their national performances on the issues as
a group.
Action
Time-scale
Take on cotton
Immediate
and trade
inequality (Section
1 and 2), in
partnership with
Fair Trade
movement
Fair Trade
movement
Local
National
stakeholders
Governments
(e.g., producer
groups, AProCA)
Campaign
Join and support
campaign (POs,
AProCA)
Raise issue in
international fora
and meetings
Regional and
Pan-African
institutions
International
Institutions and
NGOs
EU
G7
Campaign (NGOs)
Raise issue in
international fora
and meetings
Including national
level policy action
and promotion of
Modern Slavery
Act in UK and its
replication in other
countries
Promote 'living
income' for
A report for the Fair Trade Advocacy Office
77
Power in West African Cotton Supply Chains
farmers
G7 countries
Immediate
follow up on Action
for Fair
Production,
including support
for Fairtrade and
organic farmers
Campaigns
Campaigns
Lobby
Rank members on Medium to longperformance
term
Provide
information,
Provide
information
Provide
Information
Lobby
Provide
information
Provide
information
Campaign
Lead
Could do same as Annual report on
G7
member
performance on
critical issues in
cotton and actions
to improve
situation: labour,
child labour,
environment,
sustainable
trade/sustainable
cotton use and
imports in country,
4.9 International Institutions
Recommendations to international institutions are focussed one area, the cotton sustainability metrics developed by the ICAC. Joining national
programmes could allow Fairtrade and sustainable cotton products to be benchmarked and compared to conventional cotton.
Action
Time-scale
Fair Trade
movement
A report for the Fair Trade Advocacy Office
Local
stakeholders
(e.g., producer
National
Governments
Regional and
Pan-African
International
Institutions and
EU
G7
78
Power in West African Cotton Supply Chains
groups, AProCA)
Use ICAC metrics
to show progress
on sustainability
performance
(annually)
Medium to longterm (Benin is
already trialling)
Support data
collection by Fair
trade and
sustainable
projects
A report for the Fair Trade Advocacy Office
Support data
collection by Fair
trade and
sustainable
projects
institutions
Collate data and
report
NGOs
Lead data
management and
analysis (UN FAO
with ICAC)
Use to promote
sustainable and
fair cotton use by
companies and
brands
Use to promote
sustainable and
fair cotton use by
companies and
brands
79
Power in West African Cotton Supply Chains
List of persons interviewed or contacted
Mr Bachir Diop, SODEFITEX, Senegal - interviewed
Mr Wilfried Yameogo, Burkina Faso - Interviewed
Mr Youssef Sidibe, AproCA, Mali – interviewed
Mr Moussa Sabaly, AproCA, and farmer, Senegal - interviewed
Mr Francois Traore, farmer, Burkina Faso – Not available due to election campaigning
UNPCB – not available for interview during research window (however, we had interviewed them
on another project recently, and were able to draw on useful material)
Helvetas Burkina and Mali – did not reply to interview request (however, we had interviewed them
on another project recently, and were able to draw on useful material)
SOFITEX – did not reply to interview request (however, we had interviewed them on another
project recently, and were able to draw on useful material)
OBEPAB, Benin: Davo Simplice Vodouhe and Delphine Bodjrenou
Eugene Padonou, SNV-Benin
Evelyne Sissonto, Helvetas Benin
Lazare Akomagni, Office National de Stabilisation et de Soutien des Prix et des Revenus Agricoles
AIC Benin, SONAPRA – currently not in operation. No interviews.
Federation Yakaar Niani Wulli. No interview
CMDT: No interview (however, we had interviewed them on another project recently, and were able
to draw on useful material)
Mission de Restructuration du Secteur Coton, Mali
References and bibliography
AfD (2008). Developper la filiere de coton equitable et bio-equitable en Afrique de l’Ouest et de
Centre. AfD, Afd , 2 pages, 2008
AICB (2006). Application du modele de lissage a la filiere coton Burkinabe. AICB
Aideenvironment (2016, forthcoming March 2016). Baseline Study of Fairtrade Cotton in West
Africa. Aideenvironment.
Andersen S., Lau C., Schropp S., Sumner D.A. (2015). How could the 2014 US Farm Bill affect the
world cotton for cotton?. Cotton Bridges Africa Volume 4 Number 8.
AproCA, ENDA Diapol, Comic Relief, Oxfam (2014). Cotton growers' opinions on the cotton
sectors' reforms. Chad – Central African Republic. AproCA.
Burkina Faso (2014). Protocole d'accord portant cahier des charges applicables aux opérateurs de
Power in West African Cotton Supply Chains
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About the commissioning party:
The Fair Trade Advocacy Office (FTAO) speaks out for Fair Trade and Trade Justice with the aim
to improve the livelihoods of marginalised producers and workers in the South. The FTAO is a joint
initiative of Fairtrade International, the World Fair Trade Organization-Global and the World Fair
Trade Organization-Europe. More information under: www.fairtrade-advocacy.org
Acknowledgements:
The Fair Trade Advocacy Office would like to thank TransFair Germany, AProCA and the French
Development Agency (AFD) for the financial support provided to make the research study possible.
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