Cotton is the most widely used natural fibre in the textile industry.The cotton industry is worth over US$50 Billion a year and five countries, namely China, India, the US, Pakistan and Brazil – produce the majority of the roughly 26 Million Tonnes of cotton harvested each year.
India alone produces 25% of the world’s cotton, sustaining the livelihoods of 5.8 Million farmers, the majority of whom are small-scale farmers cultivating land less than 2 Hectares in size.
Small-scale cotton farmers, particularly those who grow cotton in the rainfed regions, face extreme risks due to the growing uncertainties caused by climate change today. This risk is heightened for them when the rising input costs of conventional and Genetically Modified cotton cultivation is considered, along with the fact that most of their credit needs for buying inputs are met through private money lenders who charge anywhere between 24% - 120% of annualised interest rates. This high indebtedness along with the high risks in cultivation is a recipe for economic disaster for the cotton farmers.
Fairtrade works with farmers who’ve formed small producer organisations, as well as contract production organisations in the process of forming independent co-operatives. As per the Fairtrade Standards, these farmer organisations create local support mechanisms that facilitate:
Access to markets
Access to finance
Better resource management
Better risk management
Fairtrade seeks to improve the prospects of small-scale farmers by creating access to supply chains and markets for sustainable cotton in both international markets and India.
Both the Fairtrade Minimum Price and the Fairtrade Premium for cotton, as well as targeted support and training for producers - are all aimed at helping producer organizations become stronger and far more resilient as a business.