Mark Lange, president and CEO, National Cotton Council, readily admits that the U.S. cotton industry faces some tough times. But he doesn't concede that no answers exist to meet the multitude of challenges. An innovative project Lange introduced at the recent Beltwide Cotton Conferences in San Antonio may provide answers to some of the industry's biggest challenges.
“It's clear that the U.S. cotton industry is depressed,” Lange said during a Beltwide media briefing. “We've lost acreage and the domestic textile industry has been decimated. We've changed to an export industry.”
That means changes in the way cotton flows from farm, to gin, to warehouse to mills or shippers, he said. “It used to be smooth; now we see surges and slowdowns and surges and stops.”
Inconsistent cotton movement, cotton's sustainability (the carbon footprint it leaves on the environment) and what is occurring in the largest market (Asia) represent key challenges for U.S. cotton, Lange said.
And those issues lie outside the purview of usual Cotton Council funding.
A new Cotton Foundation project, Vision of U.S. Cotton's 21st Century, will address those three industry issues. Within a year to 18 months, project creators hope Vision 21 will yield enough information to provide the industry with potential solutions to some of cotton's toughest challenges.
Lange said Vision 21 is a Cotton Foundation project that will be managed jointly by the National Cotton Council, Cotton Council International and Cotton Incorporated. The effort is aided by an initial grant from Monsanto with plans for more funding from other Foundation members.
Lange said the first area of study will be the Asian market. A growing middle class in Asia makes that region the fastest growing market for textiles. “U.S. consumption is up but only slightly. The big increase is in Asia where there is potential for economic growth and potential for huge increases in cotton consumption.
“But just because people have more income doesn't mean they will buy more cotton. We need an education effort.”
Vision 21 will help accumulate data on Asian buying habits, consumer preferences and opportunities for U.S, producers. “We will study the patterns,” Lange said. “The fiber situation is different in Asia.” Fiber content in textiles, for instance, may not be listed on fabrics. Also, polyester may be heavily subsidized.
Accumulating information about these and other trends could help the U.S. cotton industry focus marketing programs. Information also will be useful in trade agreement negotiations.
The primary focus will be on India and China's major metropolitan areas. Lange said previous efforts of Cotton Incorporated and Cotton Council International in the Asian market may help focus Vision 21 activities. An earlier program, Gold Seal, was not as successful as the industry hoped, Lange said. “But we learned from the experience and will leverage what we learned and give it another shot.”
The second focus will be on cotton's sustainability and environmental aspects of the U.S. cotton industry, from production to products on the shelf through disposal of used textile products.
Lange said consumers are interested in the carbon footprint left by the products they use. Many observers outside the cotton industry see production as the primary factor in environmental impact. “But a lot of work goes on with cotton beyond producers. At the Council we know it's a mistake to say cotton is sustainable and go just to producers. There are a lot of steps in the system,” Lange said.
Part of the study will identify what happens to products when they are used up. Comparison of cotton to man-made fiber is also important.
“We know that cotton has a lot of positive attributes. It's renewable and natural. But we want to back that up with science.”
The final initiative will be studying the flow and logistics of shipping cotton. “We have a challenge with surges, periods of high shipment and periods of low or no shipments. It will take a lot of good thinking and a logical study of cotton flow from gin to customers.”
Lange said a cotton bale may be handled six or more times from the gin to a mill or port.
“That's too many and makes us less competitive.”
He said the problem results from changes in location of cotton production and with end points for delivery. Texas and Oklahoma now account for 50 percent of U.S. cotton production, up from 25 percent just a few years ago. And most of the U.S. cotton crop goes into the export market. Not too long ago, and for many years, as much as 70 percent of U.S. cotton went to U.S. mills.
Now, cotton must move swiftly to compete in a global market.
Lange said one bottleneck is segregating cotton by quality. Streamlining the flow could mean bundling all cotton without quality differentiation. That would go against the needs of spinning operations, however.
Reduced acreage and potential loss of infrastructure also threatens efficient flow of cotton to mills and ports.
Lange said Vision 21 could be the Council's “most difficult undertaking,” but could also help develop regulations and policies for the next 10 to 15 years. “The last time we did a similar study was 1995 and 1996 and that concerned the ability to compete on a cost basis. That's still an issue, but it's now wider than just cost and concerns long-term viability.”
Lange said the U.S. cotton industry is as productive as any in the world. “We will work with scientists and industry to deal with these issues. We can't dodge them.”