Interview with Fritz Grobien

Fritz Grobien
President
Bremen Cotton Exchange

Whole textile industry is always a mirror image of the global economy...

With fibre2Fashion Correspondent Cindrella Thawani, Fritz Grobien opines that global cotton production is heterogeneous as well as great challenge to farmers. In addition, he tells about China’s stock policy and its impact on world cotton market. Synopsis: The Bremen Cotton Exchange is an international association with members ranging from the cotton source to well into the supply chain. Our position as arbitrator obliges us to remain neutral. We provide our members with information, data and knowledge. Fritz Grobien became President of the Bremen Cotton Exchange in 1991. From 1992 to 1994 he held the position of Chairman at CICCA (Committee for International Co-operation between Cotton Associations). He became the Vice-President of the newly established German/Uzbekistan Association, Bremen in 2000. Since 1998 he is member of the Board of The Liverpool Cotton Association Ltd. Excerpts:

Inflated price rise destructing demand of cotton, thus mainting reserves can be a solution? What is your outlook?

The prices have gone decreased again after the strong movements. As cotton is a natural fiber and thus depending on climatic conditions. In addition to this cotton is a commodity and object to speculation. Some parts of the market are difficult to control others are very much riddled with market and trade distortions. Estimates are not easy to give but in the long term we expect an increase of cotton use as well as an increase of competing fibers.

Cotton being a sustainable fibre from the primitive age is no more sustainable. What are your guidelines for this?

How do we define sustainability? If we take the three pillars of environment, economy and social issues, then we can see a lot of sustainability in 90 percent of the cotton grown around the world. The majority of the world’s cotton production is already classified as good or very good in all areas. The old customs of the 1970s are long gone, as in the last 30 – 40 years there has been great progress in the field of agricultural technology, whether in terms of inputs or the use of water. We must also not forget the enormous economic significance of cotton farming: more than 250 million people earn their living with cotton from the growing stage to the cotton bale, especially small farmers. The most pressing task for the cotton sector is to replace out of date or wrong information with up to date facts.

What are those potential trade risks and threat issues that have encircled to cotton, globally?

Good trading practices and maintaining trading rules is a problem that is discussed worldwide. There is always black sheep who do not play by the rules. In addition to the publication of a blacklist, we are working on further sanctions, together with 15 other international cotton exchanges in the CICCA. Mutual respect and dependability are vital for the international cotton market to be able to survive in the global supply chain.

Do you think that world’s macroeconomic instability especially in USA and Europe is a major issue of concern for cotton?

Whole textile industry is always a mirror image of the global economy, which not only affects cotton but influences the overall usage of raw material. Both USA and Europe are still important consumer markets – even if demand in Asia is growing strongly.

Why cultivation of organic farming is an exigent way for farmers and buyers?

Global cotton production is totally heterogeneous. There is not just one way to grow cotton. The so-called “identity cottons”, such as organic cotton production, Cotton made in Africa, Fairtrade or BCI are ways to produce cotton, which can provide opportunities in the respective regions. Growing organic cotton is a great challenge for farmers, as it is accompanied by a several year long period of changeover and increased work input. In view of the volatile price situation, it would be important to have set customers and guaranteed premiums. However, these are not always available.

What kind of support you provide for the cultivation of organic farming? What is your overview?

As an internationally active cotton organisation, our position is neutral. This means that we collect the data available and are in dialogue with many organisations, from the growing stage through to the supply chain. We neither support only one direction of cotton productions systems nor any particular country of cotton production but we speak in the name of all cotton production methods. Cotton as the most important natural fiber needs one voice only. As cotton association and arbitration body we provide our members and clients with data, neutral judgements, and juridical services. Here, we support with services that do not distinguish between organic and non organic.

As an imperative international cotton trade association, please tell us how Bremen Cotton Exchange is beneficial to the cotton consumers, buyers and sellers?

Our position as arbitrator obliges us to remain neutral. We provide our members with information, data and knowledge. Our cooperation with the ICA in the form of the ICA Bremen is enabling us to develop into an international centre for quality testing and training. The current project, the certification of cotton laboratories all over the world, will further increase our significance. In cooperation with other international organisations and working groups such as SEEP or the IFCP, we are working for cotton. In view of the changing fibre market, we will certainly increase our involvement here too.

Do you think that uncertainty over China’s reserved cotton stock is affecting export and imports, globally?

China’s stock policy has a significant influence on the global cotton trade pattern. If you look back into the past you have the proof of the effect the Chinese impact on the world cotton market in general as well as the impacts of any stock policy. Future development is of course a crucial question.

Published on: 16/11/2012

DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.