According to KSA Technopak, consumer spends on textile and apparel, which was one of the key categories of spends sometimes back, is shrinking in the face of demand for new categories like mobile phones, entertainment, vacations and household help, seriously impacting the sale of cotton products in India.
The consumer is spending less on textile and apparel as a percentage of total spend though in absolute terms the spend may be marginally increasing. The entire textile and apparel category as a whole is under pressure, says Baqar Naqvi, manager of KSA Technopak.
He added that within textile and apparels, in the last 20 years, the share of cotton in the total fibre consumption has come down from 80% to about 55% losing its share to synthetics, primarily polyester.
From the data compiled by KSA Technopak, in 2000 consumption of manmade fibre was 1.55 kg per capita, as opposed to 1.92 kg per capita for cotton. According to KSA Technopaks estimates, by the year 2007-2008, share of manmade fibre would be equal to the share of cotton and that by the year 2010 the consumption of manmade fibre would be 2.6 kg per capita as opposed to 2.1 of cotton.
This shows that while cotton production continues to grow, consumption will not grow at the same pace and will shift towards manmade fibres. Cotton thus will be doubly impacted, losing share in a market which is itself under pressure, says Mr Naqvi.
He said the CGA, which aims to increase consumer preference for cotton fibre over synthetics thereby increasing the sale of 100% cotton products, has so far been fairly successful. Working together with textile and retail partners in India, the CGA serves as a catalyst for increasing demand for pure cotton.
The CGA had launched programmes like The New Face of Cotton recently which was aimed at increasing preference for cotton products which will result in increased consumption at the consumer level and increased sales of products from participating firms.
India has traditionally been a strong market for natural fibres, cotton being one of the key crops and climate-wise the most suitable fibre for use in apparels. However, globally the consumption of manmade fibres has a larger share of consumption primarily because of price and availability. Cotton being a natural product and requiring valuable resources like land and water for cultivation, there is only a limited quantity that can be grown, that too in countries with the right climate.
On the other hand, production of manmade fabrics canbe increased or decreased as desired. Also a good amount of research and development have made synthetic fibres cheaper and more functional over time. These reasons have constrained the growth of cotton.
India is also following many other countries globally where consumption has shifted from cotton to manmade fibres. However many of these countries did not have a large back-end cotton industry and cultivation and thus felt little effect of this change. In India, this shift is believed to radically impact farmers and the industry, which employs more than 30 million people.
In 2005, the CGA claims it will become more bullish on its campaign. We plan to carry on with a series of campaigns with a view to increasing awareness about cotton products in the domestic market. Through the Seal of Cotton, we have tried to provide product differentiation to quality 100% cotton products. The Seal of Cotton is a well recognised mark today and consumers understand the products with the mark of higher quality, says Mr Naqvi.
The CGA is not happy with the efforts to incentivise cotton growers. As of now, cotton growers are incentivised only in the sense that the market for their products is secured. If at this point, when technology is helping production increase radically, the demand goes down the prices will drop.
This will become a serious problem for the farmers and the government. Sustenance of demand is perhaps the only way to save the farmers as well as millions of people involved in the cotton supply chain.