By David Gill
The tightness in global cotton supplies and rising prices for all kinds of cotton have become key concerns for vendors who are marketing organic cotton textiles.
The supply shortage and the price spikes could not have occurred at a worse time for this segment. Consumers are clearly showing an increased interest in organic products in all categories. They have increased their demands for products that are made through sustainable practices, with little or (if possible) no damage to the environment.
But since early last year, cotton supplies have been drawn down drastically due to poor harvests around the world, a reduction in acreage and larger orders from customers that had drawn down their inventories during the recession of 2008 and early 2009. Prices have also risen as a result, with futures quotes from the International Cotton Advisory Committee ranging above 90 cents per pound as of late May.
“Consistent with the non-organic cotton situation, on the organic cotton side, issues of price challenges and lead times are definitely piggybacking,” said Gregg Haft, president of Portico, which has licensed collections in organic bedding and bath with Home Source International and United Feather & Down.
For some forms of cotton, the price differential between organic and non-organic is huge. “The cost of the raw (Supima) cotton is almost twice the price of regular Supima cotton,” said Jesse Curlee, president of Supima, the organization that promotes and licenses the Supima brand.
This is a major concern for textiles vendors that are offering organic programs. “Consumer studies indicate that there are consumers who are interested (in organic cotton), but are unwilling to pay a premium for the product,” said Bob Hamilton, director of marketing for Welspun India—whose licensed Amy Butler designer collection includes bed ensembles made of organic cotton.
Yet some vendors in this market are soldiering on. “We haven’t run into any effects from the cotton shortage,” said John Fraley, chief operating officer of Home Source International. “In actuality, organic cotton supplies have been increasing, with more acreage being put into it in China and India.”
Fraley said several other developments have helped boost the market. “The increased planting acreage has made the cost for organic cotton more reasonable,” he said.
In addition, technological advances have made the textiles products more fashionable. “The technology as it relates to dyestuffs and printing has caught up now to where you can do fashion products in full color palettes with GOTS (Global Organic Textile Standard) certified dyes,” Fraley said. “You can produce product that is more fashionable and at a more reasonable price than what was done before.”
Even so, organic cotton products have their naysayers. “Brands and, to some degree, consumers are interested in organic cotton, but I personally think it is a rather thin allegiance, at least in textiles,” Curlee said. “Organic is about one-half of 1 percent of the entire production of Supima cotton. It is probably a little more in regular cotton, but still a very small amount.”
Hamilton agreed. “Organic cotton is a very small part of the total cotton acreage under cultivation,” he said. “As a category, it is not growing and has probably peaked as a share of the total.”
However, Fraley believes that the future is bright for this category. “I think it could become a core program at retail,” he said. However, he acknowledged that the category needs some attention from consumers. “There has to be a series of success stories at retail,” he said. “Ultimately that will drive more consumers to look for the product, and it means the stores will want to carry more.”
In addition, consumers need more in the way of information about organic cotton, according to Haft. “They relate to callouts (on packaging) that say organic products are not grown using pesticides,” he said. He also thinks that signage and in-store videos could help in this effort. “The callouts of no harsh chemicals, no harmful dyes, no pesticides, no herbicides,” Haft said. “These provide the definition of what organic is, and it makes it easy for consumers to relate to the brand and these products.”