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C O T T O N Export Market Potential for Smallholder Farmers in Haiti DEDICATION

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C O T T O N Export Market Potential for Smallholder Farmers in Haiti DEDICATION Impact Farming November 2016 C O T T O N Export Market Potential for Smallholder Farmers in Haiti DEDICATION Gérard Nozine 1946 - 2016 This study is dedicated to one of its three principle authors, Gérard Nozine, who passed away prior to publication. An agronomist by training, Gérard ’s professional life was in service to Haiti’s agricultural community. Early in his career he was involved in cotton—both growing it and providing various forms of support to other farmers who were growing it. Gérard had an encyclopedic memory of what many thought to be the lost legacy of cotton production in Haiti. Now his own legacy will include an invaluable contribution to reintroducing cotton to once again become an important cornerstone of the country’s agricultural community. ACKNOWLEDGEMENTS This study was commissioned by Impact Farming (IF) to look into This study was authored by Chris Kaput*, Remillot Levielle the feasibility of reintroducing cotton to Haiti as an export crop and Gérard Nozine. Hugh Locke of Impact Farming and the for smallholder farmers. Smallholder Farmers Alliance served as senior editor, assisted by Timote Georges of the Smallholder Farmers Alliance. Ryan The authors would like to gratefully acknowledge the study’s Lasnick provided research support. sponsors, the Smallholder Farmers Alliance (SFA) and Tim- berland. Thanks is also due to the following individuals and/or This is an independently drafted study and consequently all organizations who were very generous in sharing data, source views expressed are those of Impact Farming and do not material and technical information: necessarily represent the views of the study’s sponsors. Arun Chandra Ambatipudi, Chetna Organic - India Better Cotton Initiative Anne-Katrien Denissen, Solidaridad – The Netherlands Zerihun Desalegn, Solidarid - Ethiopia Patrick Desources, Root Capital - Haiti Simon Ferrigno Laure Heilbron, Organic Cotton Accelerator – The Netherlands Vladamir Laborde, AVENIR Haiti Charles Oboth, GADC - Uganda Martin Slawek, The Initiative for Smallholder Finance Brad van Voorhees, VF Corporation www.ImpactFarming.org | www.HaitiFarmers.org | www.Timberland.com *www.thegrowingdutchman.com ACRONYMS ABRAPA Brazilian Cotton Growers Association AbTF Aid by Trade Foundation BCI Better Cotton Initiative BCSS Better Cotton Standard System CIRAD International Cooperation Centre of Agricultural Research for Development CmiA Cotton made in Africa CNCRC China National Cotton Reserves Corporation COMPACI Competitive African Cotton Initiative COAPCL Chetna Organic Agriculture Producer Company Ltd COROS Common Objectives and Requirements of Organic Standards CRDC Cotton Research and Development Corporation FAO Food and Agriculture Organization of the United Nations FiBL Swiss Research Institute of Organic Agriculture FLO Fairtrade Labeling Organizations International FT Fairtrade GADC Gulu Agricultural Development Company GHG greenhouse gas GIZ German Agency for International Cooperation GOTS Global Organic Textile Standard ICAC International Cotton Advisory Committee ICCO Interchurch Cooperative for Development Cooperation (Netherlands) LDCs Least Developed Countries IDH Sustainable Trade Initiative (Netherlands) IFOAM International Federation of Organic Agriculture Movements ILO International Labor Organization IPM Integrated pest management ITC International Trade Center NCC National Cotton Council of America NORAD Norwegian Agency for Development Cooperation NPMi Non-Pesticide Management Initiative OE Organic Exchange OECD Organisation for Economic Co-operation and Development SIDA Swedish International Development Cooperation TE Textile Exchange UN United Nations WTO World Trade Organization WWF World Wild Fund for Nature 4 TABLE OF CONTENTS Executive Summary 5 Chapter 1: International Cotton Production and Trade 7 Introduction to Cotton 7 Global Cotton Market and Trends 10 Market for Sustainable Cotton 18 Chapter 2: Access to International Markets — Regulations and Standards 22 Regulations Applying to Growing and Selling Cotton 22 Cotton-Specific Voluntary Sustainability Initiatives and Frameworks 28 Better Cotton Initiative 28 Cotton made in Africa 31 Organic Cotton 32 Fairtrade Cotton 34 Global Organic Textile Standard (GOTS) 36 SA8000 (Social Accountability) 37 Chapter 3: Smallholder-Grown Cotton — Challenges, Opportunities and Best Practices 38 Current Best Practices in Smallholder-Grown Organic Cotton 39 Challenges and Key Success Factors in Organic Cotton Production 47 Chapter 4: History of Cotton Growing in Haiti 53 Rise and Fall of Cotton: 1737–1980s 53 Reasons for the Final Collapse of Cotton in Haiti 55 Chapter 5: Reintroducing Cotton to Haiti as a Smallholder Crop for Export 57 Potential Sites for Renewed Cotton Cultivation 57 Climate Change Considerations 57 Projecting the Potential Scale of Cotton Production in Haiti 62 Adding Cotton Processing Capacity 63 Conclusion and Recommendations 64 Annex 1: List of Companies Dedicated to Buying Fairtade/Organic/Sustainable Cotton 66 Annex 2: Overview of Minimum Ginning Requirements 68 Annex 3: Support Networks for Smallholder-Grown Cotton 74 Annex 4: Smallholder Farmers Alliance Model in Haiti 77 Date of Publication: November 9, 2016 EXECUTIVE SUMMARY 5 EXECUTIVE SUMMARY Cotton was once the fourth largest agricultural export from Haiti cerns about the resulting pollution and its contribution to climate before it all but disappeared by the late 1980s. Its demise was change have led to several standards being developed in order due largely to external pressures and internal politics, not climate to improve sustainability in the cotton sector. Key among these or environmental concerns. are 1.) Better Cotton Initiative (BCI), 2.) Cotton Made in Africa (CmiA), 3.) organic cotton, and 4.) Fairtrade cotton, with BCI This study begins with a global overview of cotton production and being by far the largest in scope. markets, and then sets out to address three fundamental questions: Along with the development of sustainability standards in the • what are the current best practices in the production of cotton sector, demand for more sustainable cotton has seen sustainable smallholder-grown cotton? a strong increase: major brands and retailers like Adidas, C&A, H&M, IKEA, Nike and Timberland have committed to sourcing • why did cotton production stop in Haiti and what are the key 100% of their cotton from more sustainable sources by 2020. lessons from that experience? On the production side, supplies of more sustainable cotton have • is it feasible to reintroduce cotton to Haiti by building on the increased significantly in the last few years, reaching unprece- sustainable, smallholder-driven agroforestry model devel- dented volumes and accounting for about 8% of global produc- oped by the Smallholder Farmers Alliance (SFA)? tion in 2014 (projected to be around 13% in 2015). Market pressure for sustainable cotton has coincided with The social and economic importance of cotton on a global scale significantly increased awareness and support for smallholder is self-evident: it is grown on approximately 33 million hectares farming in developing countries—across all categories of (2.5% of global arable land) in over 75 countries with more than agriculture—in recent years. As a result there is an unprece- 250 million people involved in its production and processing. dented body of new best practice experience from smallholders Sixty percent of the world’s cotton is grown in developing in Africa and Asia who are producing cotton in a more environ- countries by, among others, more than 100 million smallholder mentally friendly and ethical way. farmers whose livelihoods and wellbeing depend on the crop. Most of these new best practices aim to lower or eliminate Conventional cotton production has traditionally relied on highly completely the use of chemical pesticides and at the same time intensive farming methods. Consumer and manufacturer con- decrease farmers’ dependence on other costly inputs. They 6 EXECUTIVE SUMMARY also seek to improve working environments and improve health Africa) and there are large numbers of smallholder farmers issues commonly associated with conventional cotton production interested in cultivating this crop again; methods. The organic approach in particular is interesting for smallholders as it relies on an integrated approach that uses • the reality that most farmers in the country are already locally available inputs, incorporates natural methods to control organic by default, and so certification will not be as onerous pests, and requires less water. Other best practices not specific as on chemically-treated land; and to cotton, but widely used by smallholders, include soil fertility • with the introduction of 3 anchor operations of 500 small- management, crop rotation and intercropping, utilizing green holder farms each, and with a conservative projected catalytic manure to build soil, and pest control regimens that use locally impact of 5,000 additional farms per operation, the projected available, natural resources. output within 5 years could be 8,185 US tons annually Despite promising growth, the market for sustainable cotton is (based on a maximum of half of any one farmer’s land being still facing several challenges. Principle among these is that the assigned to cotton) with a total value conservatively estimated gap between purchase and supply is widening as production at between US$11.5 million and $14.3 million depending on grows faster than demand. The result is that the bulk of sustain-
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