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Increase in production costs, yield stagnation and volatile output prices have adversely affected the livelihoods of more than 6 million cotton farmers in India, who are mostly small and marginal. There is a growing discontentment among cotton growers because their net incomes have declined over the years. Costs incurred in cotton cultivation affects the profitability of cotton farmers. Various cost factors involved are: human labour, animal labour, machine labour, seed, fertilizer, manure, insecticides, irrigation charges and interest on working capital. It is estimated that the total cost of cotton production comprises of 74% operational cost and 26% fixed cost. Human labour accounts for about 30% of the total cost in cotton cultivation.
The price at which farmers have to finally sell their produce is quite uncertain and volatile. It fluctuates depending on the demand-supply factors and also the minimum support price (MSP) declared by the government. This is the price at which the government buys cotton directly from the farmers. In addition, the government’s export-import policies have a direct bearing on the farmers’ ability to fetch a fair and remunerative price. Ultimately, the cotton farmers have to totally depend on the large consuming mills, big buyers and traders as well as government’s overall policies with regard to MSP and the export-import trade in cotton.
The topic of ‘Cotton Value Chain’ is very hot these days. You can see lot of debates, high powered meetings and inter/national seminars taking place on this subject. Some events are covered on page 69 and page 76 of this issue. India is hosting the 81st Plenary Meeting of the ICAC from 2nd to 5th December 2023 in Mumbai with the theme “Cotton Value Chain- Local Innovations for Global Prosperity.”
With the above introduction, I wish to end this editorial by reproducing below some random thoughts of a blogger who covered the 11th ATEXCON organized by CITI in Coimbatore. I feel the industry and all stakeholders have to seriously look into the issue brought out by this blogger (www.contestedrealities.com). I was very impressed to read his thoughts which reveal the value of farmers in the cotton value chain!
“The conference had all the big names of the textile industry from the southern states of India. The participation was dominated by Tamil Nadu. There were spinning and weaving companies, machinery suppliers, ready made garment makers and a few representatives from sourcing outfits that intermediate the big fashion labels and brands from EU, US and India. Clearly, not a farmer’s space, especially an Indian farmer with holdings that can never get them to the conference halls and meeting rooms of decision makers in this country. Meeting place for the farmers continue to be Jantar Mantar or the Red Fort in New Delhi, perched atop their tractors, camping in their trolleys, with a mobile kitchen at the picket line.
“We have the entire textile industry leadership here on the dais’, was heard often. The ministers and bureaucrats were urged to secure more free trade agreements (FTAs), provide specific incentives to encourage various segments of the value chain, set up integrated textile parks and facilitate exports. In the conference, while there were frequent references to the cotton value chain, there was no reference to cotton farming or farmers. Perhaps, the agenda was to focus on higher end of the value chain. However, the omission is symptomatic of industrial planning and policy making. There are significant connections with agriculture sector in terms of raw material supply as well as labour supply. The assumption seems to be that cotton prices will be controlled or moderated in the interest of textile industry. Farmers’ returns are not a consideration. The new productivity paradigm appears to be not inclusive. This will create more losers on an already distressed base of low-income population.”
Managing Editor
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