2004 U.S. Organic Cotton Production & Marketing Trends
by Sally Pick, Consultant to the Organic Trade Association
Survey background and overall trends
In 2005, the Organic Trade Association mailed a survey to 52 places believed to be farming organic cotton. Surveys were sent to Arizona, California, Kansas, Missouri, New Mexico, Tennessee, and Texas, thought to represent the states with all 2004 growers of organic cotton in the United States. OTA identified growers from a list of farmers of organic cotton from last year's survey, by contacting accredited organic certifying organizations and agencies, and from organizations in the U.S. that work with organic cotton farmers. Cotton Incorporated funded the survey.
A total of twenty-one farmers from California, Kansas, Missouri, New Mexico, and Texas responded to the survey mail or were contacted by telephone or e-mail. Of the twenty-one respondents, seventeen farmers returned their completed surveys and four answered the survey by phone interviews or e-mail. An additional seven who were sent a survey were reached by phone and found not to be growers. As in last year's survey, only twelve of the respondents qualified for the survey because they grew organic cotton in 2004. Of these twelve, eight members of the Texas Organic Cotton Marketing Cooperative (TOCMC) replied to the survey. Four of the completed twelve qualifying surveys were from farmers not associated with TOCMC. TOCMC had a total of 16 farmers growing organic cotton in Texas in 2005, compared to the 18 members in the previous year. Subtracting out the nine farmers known to have not grown organic cotton in 2004 and the seven surveys sent to non-farmers, the surveyed population totaled thirty-six.
All twelve responding farmers have operated certified organic farms for at least seven years; eleven have been organic farmers for between eleven and fifteen years. Eleven out of twelve surveyed growers farm over 300 acres total, both organically and conventionally. Total acreage of both organic and conventional crops varied from between 201 and 300 on one farm, to 6,000 on the largest farm. Eight farm over 300 acres of organic cotton, growing from 460 to 1,100 acres of organic cotton on these farms. Six responding farmers grow over 300 acres of organic crops other than cotton. Other crops that surveyed farmers produce include: corn, soybeans, small grains such as oats, barley, rye and wheat, fruits, vegetables, meat animals, peanuts, pecans, alfalfa hay, herbs, and sunflowers. Eleven grew organic, upland cotton in 2004, and two grew organic, pima cotton, one of them growing only pima cotton.
Eight of the twelve farmers reported gross, annual farm sales of over $100,000; two reported $50,000 to $99,000 in total gross, annual farm sales. Seven farmers had gross sales from their organic cotton of over $100,000. One reported $50,000 to $99,000 in gross organic cotton sales, another $25,000-49,999 and a third of $5,000-$9,999, which was sold on the conventional market due to quality problems.
Acreage and Production of Organic Cotton
ACRES PLANTED & HARVESTED
According to results of this year's survey of organic cotton farmers, in 2004, farmers planted 5,550 acres of organic cotton, an increase from totals of 4,060 acres planted in 2003, representing a 37% increase over 2003 planting. The survey results indicate that the twelve farmers planted 5,020 acres of upland, organic cotton and 530 acres of pima, organic cotton. Most of 2004 organic cotton was grown in Texas and limited acreage was grown in California, New Mexico and Missouri. To maintain the confidentiality of each farmer, the data do not specify acreage grown on a per state basis. None of the responding farmers grew color grown organic cotton in 2004, though one planted color grown organic cotton in 2005.
Table 1 highlights trends in acreage of organic cotton planted. Acreage planted was the same as that harvested in 2004, according to the data provided by respondents, although one also responded that his harvest was smaller than the amount he planted due to weather problems.
The 2004 acreage listed in Table 1 includes only acres indicated on the survey replies, including eight TOCMC members, but not additional acreage from Texas Organic Cotton Marketing Cooperative farmers who did not reply to the survey. Acreage data is unavailable from TOCMC. In 1994, the total acreage of organic cotton planted was 15,856. In ten years, planted acreage has decreased by 65%. By comparison, the 2004 acres planted was 60% less than 2000 figures of 13,926 acres planted.
OTA's 2003 Beltwide Presentation, listed in the reference section below, provided the acreage data for 2000 and 1994.
Table 1. Estimated U.S. Organic Cotton Acreage Planted: Trends
|Acres Planted in 2005
|Acres Planted in 2004
|Acres Planted in 2003
| Percent Change
2003 - 2004
| Acres Planted in 2000
| Acres Planted in 1994
| Percent Change
1994 - 2004
In 2005, farmers planted 5,919 acres of upland organic cotton (including 330 acres on farms that did not grow organic cotton in 2004) and 658 acres of pima organic cotton. Organic cotton acres planted in 2005 totaled 6,577, an increase of 19% from 2004.
According to this farm survey, a total of 5,550 acres of organic cotton were harvested in 2004. One farmer indicated a decrease in harvested organic cotton as a result of the weather but listed the same amount of cotton planted as harvested. This farmer's yield was very small, probably an indication of the weather problems that affected his production. The survey's harvested acreage data is identical to the acreage planted, as is the individual breakdown of harvested acreage by state and upland and pima cotton.
The total number and breakdown of 2004 harvested bales of organic cotton identified between this farm survey and the TOCMC data are in Table 2. Survey data show a total of 5,455 bales of organic cotton harvested in 2004, with 4,875 bales of upland cotton and 580 bales of pima. Three farmers did not include bales harvested in their survey responses.
In 2004, TOCMC reported a total of 5,347 bales of upland organic cotton from their farmers, in contrast to 2,498 bales recorded by TOCMC in 2003. Accounting for duplication among the survey respondents from Texas who belong to TOCMC, the survey identified an additional 787 bales of upland cotton. A total of 6,134 harvested bales of upland cotton were identified between this survey and TOCMC's data, for 2004. Two respondents who are not members of TOCMC included a total of 160 acres of harvested organic upland and pima cotton, which they did not convert into bales in the survey. One of these farms had quality problems that did not allow the farmer to sell the cotton as organic. Texas harvested the largest number of bales, with New Mexico, California, and Missouri harvesting significantly fewer bales. The harvest data is not provided on a state-by-state basis to ensure the confidentiality of farmers who responded to the survey.
TOCMC farmers grew approximately 100 additional organic bales, but because the cotton was of lower quality, the producers sold them to conventional markets, and this data was excluded from TOCMC's totals. TOCMC does not have an exact tally of the organic bales sold on the conventional market. Adding in approximately 100 bales of upland organic cotton sold on the conventional market due to quality problems, and 580 bales of organic pima cotton, the total bales of both upland and pima harvested in 2004 was approximately 6,814, as indicated in Table 2.
Table 2. Harvested bales of organic cotton in 2004
|Source of data on harvested bales
|Total bales harvested|
|TOCMC upland organic cotton data
|TOCMC upland organic cotton grown by members but not sold to cooperative
|| 100 (approximately)|
|OTA farm survey upland organic cotton data, excluding TOCMC upland cotton data
|OTA farm survey pima organic cotton data
|Total harvested bales of organic cotton in 2004
Comparing the 6,814 total bales harvested in 2004 to the total bales harvested in 2003, 4,628 bales, the total number of bales increased by 47%. This is likely the most accurate reflection of the overall change in production in organic cotton because it reflects data from all TOCMC members. The total acreage planted and harvested
only reflects 2004 data from the survey respondents because TOCMC data on acreage is unavailable.
Sales & Marketing
Seven farmers responding to the survey indicated that they sell their organic cotton directly to the TOCMC, four directly to a mill, and three to a conventional market (two selling only 10% to conventional markets and a the third did not specify an amount). Farmers use the following marketing techniques: six find markets through a cooperative, two from referrals from resource people, and one by exhibiting at trade shows, fairs, and other public events.
Three sell some or all of their organic cotton in the U.S., and three sell 60% or more of their organic cotton to international markets. Data provided by respondents on the percentage of organic cotton sales made to domestic and international markets are in Tables 4 and 5 below (not all farmers responded to these questions on the survey).
Table 3. Percentage of organic cotton sales to domestic market
|Percentage of organic cotton sold to domestic market
Table 4. Percentage of organic cotton sales to international market
|Percentage of organic cotton sold to international market
|| # Respondents|
Nine of respondents indicated that competition from international organic cotton producers presents their biggest challenge in getting their organic cotton to market. One indicated their biggest challenge as finding a market that will pay value-added costs of organic products; another's challenge is that his production is not large enough to meet his buyer's needs. Two others noted that they have no challenges to getting their organic cotton to market. The survey data indicated that the average price per pound received by farmers showed a range, from $0.90 to $1.10 for 2004 organic, upland cotton, compared to a wider range of $0.69 to $1.40 in 2003. Organic pima cotton prices ranged from $1.35 to $1.60 in 2004.
Farmers suggested the following changes to the national organic standards to enhance their ability to market organic cotton: "Change defoliation standard;" "Allow sodium clorate to be used to defoliate;" "Require all certifiers to do residue and/or tissue testing for prohibited materials;" "Reciprocity, foreign trade tariffs, real on farm soil and tissue testing from US and foreign certifiers and do away with the mafia type payola that IFOAM does for itself;" and "None."
Educational and Economic Resources
The survey documented on going educational and economic challenges and opportunities related to organic cotton production. Educational resources on organic farming continue to be lacking at local cooperative extension offices. Only one respondent works with their local cooperative extension agents on organic farming issues; eleven indicated that they do not work with extension. Three respondents felt that their extension agents were not knowledgeable about organic practices, representing a continued opportunity for expanding educational resources on organic production at extension; one farmer checked, "somewhat knowledgeable." Four farmers reinforced this perception, indicating that there has not been an increase in educational resources about the NOP at extension since 2004; one said there has been an increase and seven were not sure. Farmers have stayed current with organic standards using the methods indicated in Table 6 below.
Table 5. How farmers stay current with organic standards
|Methods for staying current with organic standards
|# Respondents |
|Communicate with other farmers
|Read Organic Trade Association resources
|Read trade publications
|Check related websites
| Other methods: TX Dept. of Ag., word of mouth, contact with their certifying agent, meeting with buyers
Organic cotton farmers have used a range of government agencies and programs in relation to organic production, namely, six used the organic certification cost-share program, five used the Farm Service Agency, two used EQIP, and two used the Natural Resources Conservation Service. One noted that they use their county and another their state department of agriculture.
Responding farmers use the following certifiers: Texas Department of Agriculture (a majority of respondents), Organic Crop Improvement Association, CCOF, and New Mexico Organic Commodity Commission.
Farmers rated USDA as somewhat effective (4 respondents) and not effective (5 respondents) in addressing their concerns on organic production. Only one rated USDA as very effective.
When asked what would prevent conventional cotton farmers from adopting organic farm practices or entice them to adopt organic farm practices, they responded with the following comments:
- "Expense of production."
- "1. Threat of elimination by Texas Boll Weevil Eradication Foundation. 2. The 3-year transition period is a hurdle that stops others from becoming organic."
- "Too much risk, too low prices."
- "Transition prices."
- "USDA incentive or tax break."
- "Use of chemicals."
- "Fear of losing chemical control."
- "Fear of change."
- "Lack of guaranteed market - 3 years down the road."
- "Dollars talk - stable premium markets."
The responses to the question regarding what could be done to improve support for the long-term economic sustainability of organic farms were as follows:
- "Stable prices especially cotton price reflecting true cost."
- "Support sustainable prices for the grower."
- "Demand for products continues to grow."
- "Education of consumer and supply chain."
- "Ensure sound markets. Outreach programs to conventional farmers with education and enticements."
- "US companies buying just US farm products."
- "Education on the environmental benefits, and thus the added cost for products. And that cost can be greatly reduced if in each step of marketing, the "middleman" only added his increased costs, rather than use the typical "multiplier" method for determining his price level."
Production of organic cotton in the US is on the rise from 2003, according to this survey. 2004 showed a 37% increase in acres planted over 2003. Four farmers anticipate an increase in acreage for organic cotton of as much as 25% in the next five years and another is planning on a 26-50% increase.
Surveyed farmers planted 19% more organic cotton in 2005 than in 2004, confirming an upward trend in production. Seven farmers plan to keep the same acreage of organic cotton. One of these seven also checked that he planned a change of up to 25%; this farmer did not indicate if the change was an increase or decrease. The most accurate reflection of production changes, total bales harvested, showed an increase of 47% from 2003 to 2004.
Despite this increase in production of organic cotton, economic pressures continue to exert significant influence on organic cotton farmers, and these economic pressures remain a barrier to larger increases in production and adoption by conventional farmers. The survey price data and qualitative answers from farmers indicate that unstable, low prices and weak markets are still major challenges. A majority of surveyed farmers believe that competition from international organic cotton growers is their most significant marketing challenge.
Although organic cotton production in the U.S. has shown an increase over the last year, the overall production is still well below peak production acreage of 24,625 planted in 1995. To increase organic cotton production to 1995 peak rates and beyond, farmers will need the assurance of a stable market in the US that ensures them prices that reflect the cost of growing organically.
Eleven of the twelve respondents were unaware that the Organic Trade Association had been awarded a grant to encourage non-profits to purchase t-shirts made from US grown organic cotton. One farmer expressed skepticism on the potential impact of this grant on US grown cotton sales because mills have no way of tracking organic cotton and therefore cannot be held accountable for using organic cotton.
When asked for additional comments on how to help promote profitable production and marketing of organic cotton in the US, one farmer suggested educating buyers on the importance of a good price for transitional cotton, to encourage new growers. According to surveyed farmers, they will also need an expansion in consumer education to drive an increase in demand for organic cotton grown in the U.S., loan rates which reflect organic cotton prices, crop insurance which reflects the cost of growing organic cotton and perhaps other incentives.
This survey would not have been possible without the generous input provided by farmers growing organic cotton, who took time out of their busy schedules to complete the farm survey and respond to phone calls and e-mails regarding the survey.
Many thanks to Anita Morton, of Texas Organic Cotton Marketing Cooperative, for her time and help with providing data on the Texas Organic Cotton Marketing Cooperative, which were invaluable to developing an accurate estimate of 2004 organic cotton production data.
Thanks also to Dr. Richard Levins, Professor Emeritus of the University of Minnesota, who contributed his clarity and expertise in survey research to the development of this survey.
Of course, thanks go out Cotton Incorporated who made this survey possible with a grant from to the Organic Trade Association.
Organic Trade Association. 2003. 2003 Beltwide Presentation, Organic Cotton: Production and Marketing Trends in the United States and Canada - 2001 and 2002.
Organic Trade Association. 2004. 2003 U.S. Organic Cotton Production & the Impact of the National Organic Program on Organic Cotton Farming.