Organization and Performance of Cotton Sectors in Africa ... - infoDev

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to reach 25 million tons of lint in 2006, up from 10.2 million tons in 1960.Most of this growth came from China and India, whose production quadrupledduring that period. Today, these two countries account for almost 45 percentof world cotton production and more than half of global consumption.Other countries that significantly increased their production shares during thisperiod were Brazil, Greece, Pakistan, and Turkey (see table 2.1). Some newentrants also contributed to this growth. Australia, for example, which producedonly 2,000 tons of cotton in 1960, averaged 0.5 million tons between1995 and 2005. Francophone Africa produced less than 100,000 tons in the1960s and now produces 10 times that much. The United States and the CentralAsian republics, two of the four dominant cotton producers during the1960s, have maintained their production at about the same levels, effectivelyhalving their global output shares. A number of Central American countries thattogether accounted for 250,000 tons during the 1970s now produce virtually nocotton at all.About one-third of cotton production is traded internationally. The threedominant exporters—the United States, Central Asia, and FrancophoneAfrica—account for more than two-thirds of global exports. Overall, Sub-Saharan Africa (SSA) increased its share in world cotton trade from 7 percentin 1960 to 15 percent in 2006. However, the export performances of West andCentral Africa (WCA) and East and Southern Africa (ESA) differ considerably.In 1960, WCA accounted for a little more than 1 percent of global exportswhile today it accounts for more than 11 percent. Exports from ESA, however,have declined from 6 percent in 1960 to 4 percent today.World prices for cotton have been declining mostly as a result of competitionon the supply side, which has driven down production costs; such reductionshave been associated primarily with technological improvements resulting inyield increases from 300 kilograms of lint per hectare in the early 1960s to about700 kilograms of lint per hectare in 2005 (world average). This yield increasereflects the introduction of improved varieties and increased use of irrigationand chemical fertilizers. The spread of genetically modified (GM) seed technologyin developing countries and precision farming in developed countries isexpected to reduce the costs of production even further.More than one-quarter of the area allocated to cotton is currently plantedusing GM varieties, accounting for almost 40 percent of world production. GMcotton in the United States—where it was first introduced in 1996—currentlyaccounts for about 80 percent of the U.S. area allocated to cotton. Other majorGM cotton producers are Argentina (70 percent of its cotton area), Australia(80 percent), China (60 percent), Colombia (35 percent), India (10 percent),Mexico (40 percent), and South Africa (90 percent). 12 Countries at a trial stageinclude Brazil, Burkina Faso (the only SSA country), Israel, Pakistan, andTurkey (Cotton Outlook 2005).Although the past decade has witnessed the expansion of the organic movementin other commodities, cotton has not enjoyed much success. Organic12 BAFFES AND ESTUR
Table 2.1 Global Balance of the Cotton Market (thousand metric tons)Country or Region 1960 1970 1980 1990 2000 2005 2006 2007ProductionChina 1,372 1,995 2,707 4,508 4,417 5,714 6,729 8,078India 1,012 909 1,322 1,989 2,380 4,148 4,590 5,355United States 3,147 2,219 2,422 3,376 3,818 5,201 4,731 4,182Pakistan 306 543 714 1,638 1,816 2,089 2,115 1,845Central Asia 1,491 2,342 2,661 2,593 1,412 1,828 1,719 1,788Brazil 425 549 623 717 939 1,038 1,381 1,556Turkey 192 400 500 655 880 800 850 675Francophone Africa 63 140 224 562 728 937 888 571Greece 63 110 115 213 421 430 300 300Australia 2 19 99 433 804 589 253 116World 10,201 11,740 13,831 18,970 19,437 24,775 25,312 26,213ExportsUnited States 1,444 848 1,290 1,697 1,472 3,821 3,048 3,092Central Asia 381 553 876 1,835 1,203 1,454 1,467 1,324India 53 34 140 255 24 800 1,050 1,300Francophone Africa 48 137 185 498 767 1,013 928 609Brazil 152 220 21 167 68 429 300 500Australia 0 4 53 329 849 628 483 270Greece 33 0 13 86 244 355 243 223Egypt, Arab Rep. of 346 304 162 18 79 100 100 125Syrian Arab Rep. 97 134 71 91 212 191 100 65World 3,667 3,875 4,414 5,081 5,857 9,801 8,270 8,247Source: ICAC various issues.Note: Bangladesh is included in Pakistan through 1970. Francophone Africa comprises Benin, Burkina Faso, Cameroon, the Central African Republic, Chad,Côte d’Ivoire, Guinea, Madagascar, Mali, Niger, Senegal, and Togo. Central Asia comprises Azerbaijan, Kazakhstan, the Kyrgyz Republic, Tajikistan, Turkmenistan,and Uzbekistan. Years refer to marketing seasons, for example, 2006 is 2006/07 (August through July).13
Page 1: AGRICULTURE AND RURAL DEVELOPMENTOr
Page 4 and 5: AGRICULTURE AND RURAL DEVELOPMENTSe
Page 6 and 7: © 2009 The International Bank for
Page 8 and 9: Section II. Historical Background a
Page 11 and 12: BOXES, FIGURES, AND TABLESBoxes2.1
Page 13: 5.2 Summary of Pricing Mechanisms i
Page 16 and 17: eference are limited to neighboring
Page 19 and 20: ACKNOWLEDGMENTSThis study was carri
Page 21 and 22: ABBREVIATIONS¢ U.S. centACPAgricul
Page 23: US$U shWAEMUWCAWTOU.S. dollarUganda
Page 26 and 27: output markets, improving productiv
Page 28 and 29: etween these competing needs, provi
Page 30 and 31: ■■■■■competition increase
Page 32 and 33: monopolies range from 0.98 to 1.15,
Page 34 and 35: macroeconomics, developments in com
Page 36 and 37: central body and that the state nee
Page 39 and 40: CHAPTER ONEIntroductionDavid Tschir
Page 41 and 42: The debate about how to deal with t
Page 43 and 44: Figure 1.1 Map of Africa Highlighti
Page 45: hypotheses about sector performance
Page 50 and 51: cotton production was introduced in
Page 52 and 53: Figure 2.2 Nominal Cotton Prices (U
Page 54 and 55: Box 2.1 (Continued)Togo, 39 percent
Page 56 and 57: Box 2.2 Cotton SubsidiesCotton subs
Page 58 and 59: efers specifically to the presence
Page 60 and 61: picking, storage, handling, or tran
Page 62 and 63: national monopoly (state-owned or p
Page 65: SECTION TWOHistorical Background an
Page 68 and 69: shares belonging to governments, an
Page 70 and 71: Changes Made Since the End of the 1
Page 72 and 73: long-term development strategies, (
Page 74 and 75: possible link between price-setting
Page 76 and 77: production fell further, to lows of
Page 78 and 79: all aspects of the chain from input
Page 80 and 81: suggestions (a) of establishing fas
Page 82 and 83: Figure 4.1 Decision Tree for Cotton
Page 84 and 85: Figure 4.2 African Cotton Sector Ty
Page 86 and 87: Box 4.1 Is This Typology Specific t
Page 88 and 89: 52Table 4.1 Trading Off: Strengths
Page 90 and 91: CONCEPTUALIZATION OF THE LINKS BETW
Page 92 and 93: chosen in this book and the impact
Page 94 and 95: Table 4.3 Expected Performance alon
Page 96 and 97: Box 4.2 (Continued)Second, farmers
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SECTION THREEComparative Analysis:C
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PRICING MECHANISMS IN WCAPricing me
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efore planting, price risk in the s
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Table 5.3 Summary of Producer Share
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Finally, FOT price shares in WCA ro
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MALI AND CAMEROON: GOVERNMENT MONOP
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Significant in Mozambique, the comp
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Zimbabwe transitioned during the 19
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Box 6.1 (Continued)A move from a co
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82Table 6.1 Summary of Input Supply
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84Table 6.1 (Continued)IndicatorsCo
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CHAPTER SEVENQuality ControlGérald
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Tanzania Competitive 1 2 Very lax n
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Figure 7.1 Estimated Premium for To
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all fiber coming from Africa—are
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Box 7.1 (Continued)newly liberalize
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CHAPTER EIGHTValorization of SeedCo
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competitive market in some of the o
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a few years, it indicates that some
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should eventually make a difference
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CHAPTER NINECotton ResearchDuncan B
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With regard to human and financial
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■■■Be involved in setting res
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made royalty payments to CRI. When
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and to identify complementary inves
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CHAPTER TENYields and Returns toFar
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fact that 55 percent of cotton is p
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Yields by Farmer TypeTo assess perf
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Factors beyond company services als
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Table 10.1 Summary Crop Budgets by
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According to the focus group inform
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Figure 10.6 Net Margins after All C
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All other variables in the budgets
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Table 10.2Summary of Average Yield
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■■■■impression is given tha
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were based on a 2005 cotton farmer
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more recent data are not available
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Figure 11.1 Estimated Average Ginni
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to buy seed cotton immediately afte
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146Table 11.3 Overall Competitivene
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148Table 11.4 Total Value Added per
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Figure 11.3 Total Value Added per c
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CHAPTER TWELVEConclusionsPatrick La
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Table 12.1 Summary of Expected and
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Valorization ofby-productsValue of
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Macro impact■ Total value addedpe
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across concession zones, with newer
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high yields. However, a mixed pictu
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governance and regulatory structure
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against price and exchange rate ris
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Improvements in the Delivery of Ext
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esistant, “stacked” genes), and
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Just as improved sector management
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More-competitive systems are perhap
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■■■■Interprofessional commi
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were to occur, it would most likely
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APPENDIX AStatistical Tables181
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1989/90 43 111 383 40.7 95 0.491990
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1989/90 62 150 416 41.0 95 0.671990
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1989/90 43 89 482 41.3 95 0.651990/
Page 225 and 226:
1989/90 99 189 521 42.8 85 0.541990
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1997/98 31 327 95 33 to 35 2,950 83
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1994/95 82 344 238 33 207.0 40.0119
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Table A8 ZambiaSeasonLint productio
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Table A9 ZimbabweSeasonLint product
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Table A10 Ginning and FOB-to-CIF Co
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1997/98 1.64 598 210 75 49 74 7.619
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1987/88 17,609 31,238 564 414 911 4
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206 NOTES11. Important cotton secto
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208 NOTES47. Benin is not included
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210 NOTES79. In Zimbabwe and Zambia
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BIBLIOGRAPHYBadiane, Ousmane, Dhane
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and Instability, ed. A. Sarris and
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World Bank. 2007. Strategies for Co
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CFA exchange rate, 17-18b, 19fcompa
Page 258 and 259:
input credit and extension in, 77-8
Page 260 and 261:
firm types, 211n93fixed prices, for
Page 262 and 263:
productivity, 119, 121f, 205n8,209n
Page 264 and 265:
key indicators, 56-58, 57-58t,155-5
Page 266 and 267:
focus group discussions by farmerty
Page 268 and 269:
technology transfer, 170-71by typol
Page 270:
ECO-AUDITEnvironmental Benefits Sta
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