By: Dr. K.P. Chellamani and Mr. M.K. Vittopa

The South India Textile Research Association
Coimbatore � 641 014

Introduction

Traditionally, Indian textile industry has been very strong in fine and superfine varieties of textile products in the global market. The fine and superfine cotton fabrics fetch very high value addition.

Promotion of ELS cotton would have great impact on the development of the handloom sector and fulfil the requirements to develop the �HANDLOOM MARK� announced in the Union budget 2006-07. The handloom weavers would be able to get the fine and superfine count cotton yarns at a competitive price and produce a large number of value added apparels.

Fine and super fine cotton yarns are also used for knitting fashion garments and kids wear.

Foreign demand for ELS cotton fibre is on the increase; ELS cotton consumption is surging in China because of the investments that have been made in the Chinese textile industry over the past few years. Currently, India has over 40% share in the global yarn trade of fine and superfine counts and most of the mills producing fine counts have already established their �Brand� in the global market.

In order to face the global competition, it is essential to make ELS cotton available to the Indian mills with price levels at par with the International prices. Hence, it is imperative for India to give priority in increasing the ELS cotton production to retain the market share and to improve the fortunes of the farming community.

This paper deals with how contract farming through mills association can help to promote ELS production in India.

2.0 Decline in ELS Cotton Production in India over the Years

As per projections made by Arindam Basu & K. P. Chellamani[3], the ELS cotton requirement at the terminal year of the 11th Five year plan period (2011-12) will be around 20 lakh bales.

During 1983-84, India achieved a record production of 11.46 lakh bales in ELS varieties. During the year 1987-88, India could produce 12.21 lakh bales in DCH 32 variety alone. In Suvin, the country could produce 0.44 lakh bales in the year 1989-90. Now, the production in ELS varieties has come down drastically and India could produce hardly 2000 bales in Suvin and 3.11 lakh bales in DCH 32.

2.1 Why Salem Cotton Farmers gave up �Suvin� Cultivation?

- A Quote from News Item Appeared in Business Line[4]

The one common factor among Mr. E.R. Sakthivel, Mr. M. Govindaraj and Mr. D. Durai Ganapathy, all farmers from Athur in Salem District, is that they were all, once upon a time, loyal growers of the �Suvin� cotton, for which Athur is well known. The �Suvin� variety has been considered as an equivalent to the finest Egyptian cotton. And today all of them have given up cultivating this cotton variety to take up the other less known long/medium staple cotton varieties.


The reason is the decline in yield suffered during successive years by Suvin, which is capable of spinning fine and super fine yarns. From what had been the original growing tract of some 12,000 acres plus in Athur and surrounding regions in Tamil Nadu, the Suvin cotton tract has now shrunk to less than 1,500 acres.

The per acre yield of Suvin, which was 10 � 12 quintal during 1980-90, gradually started declining and today the farmers cultivating this variety hardly get 2 � 3 quintals. The economic loss suffered by farmers by raising Suvin became too staggering for anyone in the region to continue cultivating this variety.

At the height of the yield decline seen in the variety, Suvin farmers were confronted with the phenomenon of formation of very few bolls in the plants and non-bursting of the bolls till the end, which often made the farmers force-open the petals of the bolls to release the cotton fibre.

�There was no on-farm guidance available to tackle this problem, essentially related to the quality of the seeds. To counter the poor quality of seeds, farmers raising the Suvin took to excess spraying of pesticides to address the sucking pests (white fly afflictions), which again had widened the cost benefit ratio in cultivating this particular cotton variety�, said Mr. Govindaraj, who maintained that against the price realisation of Rs.1,000 a quintal, the high production cost involved in Suvin cultivation (about Rs. 5,000 an acre) had practically deprived the farmer�s enthusiasm.

�Ryots� Ignorance Hampering DCH 32 Cotton Cultivation

- A Quote from News Item appeared in Deccan Herald[5]

Cultivation of DCH 32 cotton in India has suffered a severe setback due to lack of scientific training and ignorance among farmers about export possibilities. According to analytical reports, farmers are yet to understand completely the scientific method of cultivating DCH 32 cotton. Lack of interest among corporates and agricultural colleges in training farmers, especially the cotton growers has made farmers to loose interest in opting DCH 32, a high commercial value crop. Usage of more quantity of pesticides and development of resistant power among insects have results in steep downfall in the cultivation of extra long staple variety like DCH 32.

The factors responsible for the downfall in the production of ELS cotton in India as quoted in sections 2.1 and 2.2 can effectively be tackled through contract farming.

Integrated Cotton Contract Farming (ICCF) - An Effective Mean to Increase the Production of ELS cotton in India

Integrated Cotton Contract Farming (ICCF) has established itself as one of the effective means to reduce contamination in cotton. Some of the benefits that accrued to the textile mills through ICCF are given in Table 1.


The working model of ICCF consists of 4 participants as given in Table 2.

* Self help groups

The respective roles of co-ordinator, grower, financial and consumer in ICCF set-up are enumerated below:

Role of Co-ordinator

� To campaign, educate and convince potential formers to form SHGs.

� To arrange bank credit at affordable interest rate.

� To arrange crop insurance at affordable premium.

� To propagate one variety one group/village concept

� To implement synchronised sowing among SHGs.

� To educate SHGs about best farm practices

� To adopt Integrated Pest Management (IPM) and Integrated Nutrient Management (ICM) to lead the SHGs to lower the cultivation costs

� To help SHGs source quality inputs at competitive rates

� To help SHGs achieve improved quality and yield

� To facilitate assured buy-back of harvested products of SHGs at remunerative prices

� To provide pre-harvest and post-harvest training to collect contamination free cotton.

� To make use of cloth bags to pack and transport cotton to avoid contamination.

Role of Grower (Farmer SHGs)

� To join SHGs as recommended by Co-ordinator

� To adhere to all norms of Co-ordinator

� To grow the mutually agreed cotton variety

� To assure and adhere to all bank norms for financial help

� To find source farm inputs only Co-ordinator recommendation farm service providers

� To adhere to integrated pest management programme recommendations

� SHGs to collectively sell their produce, only to Co-ordinator recommended/facilitated purchasers.

� To reply the lending bank

Role of Financier (Banks)

� To co-ordinate with Co-ordinator to enlist the SHGs.

� To extend credit to the enlisted SHGs at lowest possible interest

� To monitor, co-ordinate and interact frequently with co-ordinator

� To collect sale dues from the SHGs, facilitated by Co-ordinator, upon sale of cotton

� Recover the credit before disbursement of balance payment

Role of Consumer (Textile Industry)

� To make contracts with SHGs, facilitated by Co-ordinator, the quantity and quality of cotton is required.

� To give assurance to participate actively in the Integrated Cotton Contract Farming Programme.

� To participate and procure the contracted quantity, as per the guidelines of Co-ordinator.

From the working model of ICCF it is clear that

� ICCF is helpful to the farmers, among other things,


To reduce the cost of production
to avoid uncertainities involved in marketing their produce

� ICCF is helpful to the textile mills,

To acquire required quality and quantity of cotton which helps for planning their production pattern for domestic and export markets

Hence, ICCF is recommended as a major strategy for increasing the production of ELS cotton in India. In ICCF, a close relationship between the producer and consumer is achieved for mutual benefit.

Currently, ELS cotton contract farming projects are being implemented by

M/s. Appachi Cotton Co., Pollachi,

M/s. Super Spinning Mills Limited, Coimbatore,

Karnataka Textile Mills Association, Bangalore and few others in the Southern states with input supply and services from Bayer Crop Science, Mumbai.

Experiences in ELS Cotton Contract Farming

Contract Farming projects carried out by M/s. Super Spinning Mills Limited, Coimbatore have resulted an increase in yield of 1 to 2 quintals/hectare for TCHB � 213 cotton. Contract farming projects of Karnataka Textile Mills Association, Bangalore have shown encouraging results for DCH 32 cotton. M/s. Appachi Cotton Co., Pollachi have tied up with Bayer Crop Science, Mumabi for contract farming of DCH 32 and Suvin cottons in Tamil Nadu.

5.0 Essential Measures for the Continued Success of ICCF for ELS Cotton

�Farmers Default� in contract farming has occurred in a few cases in Tamil Nadu. Here, the farmers break the contract and sell their produce in alternative markets. This tendency has to be arrested by appropriate interventions, a few of which are suggested below:

� Organising farmer�s associations

� Good communication and close monitoring of farmers

The modalities for successful implementation of ICCF projects need to be worked out between the various stakeholders and the same has to be religiously adhered to. Textile mills should whole-heartedly welcome the ICCF mode as a means to produce world-class yarns, rather than treating it as an unnecessary binding on their part.

Acknowledgement

The authors are thankful to Dr. Arindam Basu, Director, SITRA for his guidance at various stages of preparation of this paper. Thanks are also due to Ms. Indra Doraiswamy, Research Advisor, SITRA for her valuable suggestions, which has helped the authors in consolidating the ideas put-forth in this paper. The authors are thankful to Mr. P.V. Ramasamy, Chief Executive, The South India Cotton Association (SICA), Coimbatore, Mr. K.R. Seethapathy, Executive Director, Super spinning Mills Ltd, Coimbatore and Mr. Mani Chinnaswamy, Managing Partner, Appachi Cotton Co., Pollachi for providing us the necessary information, which were made use of in preparing this paper.

References

1. SIMA Review, Vol. XI, July 2006, No. 7, pages 17 � 27

2. CI World Report, April 2006-09-04

3. Arindam Basu & K.P. Chellamani, �Present Status and Future Requirement of ELS Cotton�, paper presented at the National Workshop on Increasing ELS Cotton Production in India� held at Tamil Nadu Agricultural University, Coimbatore during 29th and 30th September 2006.

4. �Business Line�, 10th January 2006

5. �Deccan Herald�, 26th August 2006

About the author:

Dr. K.P. Chellamani and Mr. M.K. Vittopa are associated with SITRA

The south Indian Textile Research Association,

P.B.No.: 3205, Coimbatore Aerodrome Post, Coimbatore - 641 014, Tamil nadu, India.
Phone : 91 - 422 - 2574367-9,
Fax : 91 - 422 - 2571896,
Email : sitra@vsnl.com


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