Friday, June 01, 2012

India to give major boost to Africa's cotton output

Accra, June 1 (IANS) India has set in motion a $4.66 million programme to develop the cotton industry across the African continent, which has faced a combination of problems over the years.
The plan will initially cover seven countries across the continent, S.K. Makhijani, economic counsellor in the Indian High Commission in Abuja, Nigeria, told IANS.
The seven countries are Benin, Nigeria, Chad, Burkina Faso, Mali, Malawi and Uganda, Makhijani said in an email message, adding: "The entire project is valued at $4.66 million and it covers the three-year period from January 2012 to December 2014."
Experts claim African producers have not been able to improve their production over the past few decades. Alejandro Plastin, an economist of the International Cotton Advisory Council (ICAC), said African cotton production declined from a peak of two million tonnes in 2004-05 to just a million tonnes in the three seasons up to last year.
"African cotton accounted for seven percent of world cotton production at its peak, while it accounts for only five percent now," Plastin added.
Notwithstanding the low production, he said, "African cotton is perceived to be of higher quality than cotton from many competing origins and to have fewer neps because of hand picking. However, African cotton has a strongly negative perception for contamination and delays in delivery linked to poor roads, railroads and ports."
"Furthermore, most African cotton is still hand-classed, while competing exporters make full use of high volume instruments (HVI). However, the greatest challenge for African cotton is its declining international competitiveness due to declining yields," Plastin said.
"World cotton production increased from 13.8 million tonnes in 1980-81 to 24.9 million tonnes in 2010-11 and is expected to reach 26.8 million tonnes in the current season, as a reaction to the record prices observed last season."
Despite the increase in production observed over the last three decades, the total area under production globally always fluctuated around 33 million hectares.
"Consequently, increase in production was driven by increase in yields. In particular, increases in yields from the 1990s to the 2000s were driven by the adoption of better production practices around the globe, but mainly by the adoption of biotechnology in major producing countries. This is what kept Africa's production very low because it had not been able to keep up with the changes in the sector," Plastin added.
Last year, Payhounni Bebnone, vice president of the African Producers of Cotton Association (AProCA), told a meeting of the Africa cotton producers in Cotonou, Benin, that the industry across the continent was "facing many different challenges. Efforts in some countries to find solutions have rather contributed to worsening of the situation."
He identified access to land for production as one of the main problems.
"Most of the land was leased and there was insecurity to tenure. This has affected programmes to promote better farming practices," Bebnone said.
He said return to yield has also been greatly affected. "There has been a steady decrease in average yield. Whilst it peaked around 1,150 kilograms per hectare some 10 years ago, it hovers around 900 kilograms per hectare today."
It is against this background that the Indian initiative has been formulated.
"This is an Indian initiative under the aegis of the second India-Africa Forum Summit aimed at strengthening the competitiveness of the cotton sector," Makhijani said. This is to be done through training, transfer of technology and ICT-based interventions in production.
In addition, "training in extension technology, training in post-harvest management as well as pilot projects on crop residue-based industries" will be conducted.
It is also expected there would be the establishment of skill schools, exposure visits, advisory support for policy framework and investment promotion.
"It is hoped that these initiatives would change the face of an industry that has suffered a myriad of problems over the years," Makhijani said.
Over the last 20 years, the world cotton yield has climbed from 600 kg of lint per hectare to 750 kg per hectare, while the yield in Africa has declined from about 400 kg per hectare to 315 kg per hectare now. The keys to increasing yields are strong regulatory systems to ensure credit recovery and prevent pirate buying and increased research and extension.
At current prices, African cotton production is valued at approximately $3 billion. As a general guide, $1 spent in research and extension yields $6 in increased productivity.
"If Africa is to double production by 2020, investments of $500 million need to be made. This is an achievable increase in investment in the cotton sector when spread over a number of years and across several African countries," Plastina said.
With world cotton yields rising slowly during the 2010s and competition for land with biofuels limiting the area for cotton, the ICAC expects nominal cotton prices to be higher this decade than was the case in previous decades.
Some experts say Africa has the potential to raise production to three million tonnes by 2020. Thus, there will be opportunities for income growth in the African cotton sector if yields and logistics can be improved.

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