07-10-2020

Challenges and opportunities with cotton sourcing – going local

It is no great surprise that the global textile industry is facing many challenges with hyper-globalized supply chains and production. At the same time, consumer-demand for responsibly produced goods is increasing every day. Despite the major challenges that the textile and fashion industry are facing, the current situation with Covid-19 also creates an opportunity to reconsider how supply chains are constructed. Rethinking the way we do business offers an opportunity to do better. One of those opportunities already exists in the Ethiopian cotton and textile sector.

Challenges to the global model

Companies in the textile and fashion industry who are looking to change their global supply of cotton and textiles face complex sets of challenges.

Producing cotton is in itself a challenging process, and may have negative effects on people and environment. Some of the main environmental issues are water consumption and pollution, as well as excessive use of pesticides and soil depletion. Additionally, the cotton sector also faces serious violations of human rights, such as forced labour and child labour, as well as low income for small farmers.

Adding to this, after cotton is grown there is still a chain of challenges before we have a (sustainable) t-shirt in our hands. In most textile supply chains the processed cotton travels to several different countries and often between continents for production of textiles, before it eventually reaches its final destination. On this journey, the supply chain again faces a number of challenges for the environment and the people involved.

Global companies have an opportunity to source responsibly by using their financial capacity and power to make a change. How can we rethink this global supply chain to make that change?

Choosing a local model: Ethiopia as an opportunity for forward thinking businesses

One way of rethinking the global textile supply chain and get an opportunity to do better is trying to combine the two major challenges of cotton sourcing and production. Ethiopia is one example of a country with great potential to combine these two challenges. Being a relatively ‘young’ production country, the opportunity is there for companies to engage in building up a strong and sustainable cotton growing industry as well as textile production, by placing a large number of supply chain links in the same geographical area.

However, the Ethiopian industry is facing a number of capacity challenges such as unskilled workers and unsteady cotton supply, which needs strengthening. The textile industry is new and fragile in Ethiopia, yet with the right investment of time and money, the global textile industry has an opportunity to embed a more local and sustainable textile supply chain in Ethiopia and the surrounding countries. The new market in Ethiopia is a chance for global and powerful textile brands to help design and foster a local textile-sourcing sector with the right values and requirements in place from the beginning with workers’ rights and new technology.

The global textile company Scan-Thor / Otto International is an interesting case study for companies looking to begin a new sustainable sourcing adventure in Ethiopia. Scan-Thor has been working in Ethiopia for three years on building up their supply chain with sustainability initiatives such as the standard Cotton Made in Africa, in order to secure a higher standard of cotton in terms of both environmental and social matters, as well as product quality. According to Scan-Thor, they operate from the recognition, that sourcing from Ethiopia is not a quick-win, but a long-term investment that requires the right attitude, time and money to engage with the local community. Cotton is an important crop and source of income in a range of African countries, and Cotton Made in Africa is working to protect the environment, while improving working and living conditions for smallholder farmers and ginnery workers.

Today we celebrate International Cotton Day. Danish Initiative for Ethical Trade is collaborating with Cotton Made in Africa, Solidaridad Network and MVO Netherland in the Bottom UP! project to strengthen the growing textile industry in Ethiopia.

Read more about the project here: https://www.dieh.dk/projekter/bottom-up/ or dig deeper in the project report ’Sourcing textile and garments in Ethiopia A new sourcing destination’ to get an overview and understanding of the business potential and challenges in the Ethiopian textile industry. 

 

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