Interview with Adam Kay

Adam Kay
CEO
Cotton Australia

Australia grows more cotton crop per drop than any other nation

The Australian cotton industry is the highest yielding cotton industry of the world. In an interview with Fibre2Fashion.com, Adam Kay, CEO of Cotton Australia unveils the strengths and weaknesses, current market opportunities, and the contribution of the organisation towards the uplifting of the Australian cotton industry.

Given that there is an increasing number of alternatives to cotton fibre for the textiles industry, how important is it to ensure security of cotton supply?

Ensuring the supply chain for cotton is very important, which is why Cotton Australia has engaged several programmes in this area over the past two years. It includes our participation in the Cotton Leads programme, which ensures and promotes the availability of responsibly produced cotton. We are also active in the Better Cotton Initiative, again ensuring responsibly produced cotton is available. All these programmes have a role in promoting best practice in cotton production.

Ensuring that China has a resilient cotton supply chain is in the interest of the global textiles industry. Do you agree?

Chinese textiles and related industries are the world's biggest consumers of cotton, and more than 60 per cent of Australia's cotton crop is exported to China. For these reasons, it is important for Australian cotton growers that China's access to global cotton supplies is resilient and efficient. Cotton Australia is doing its part to ensure China retains access to our cotton by directly promoting our excellent fibre to Chinese spinners and manufacturers and advising the Australian government on trade negotiations and agreements in order to maintain the supply chain.

According to you, what exactly is the market opportunity for brands in the Australian cotton industry?

We see enormous opportunity for global brands to select Australian cotton for its many excellent properties - it is strong, white, contamination-free, and responsibly produced. All qualities are desirable - manufacturers favour our fibre's strength and colour in their processes, and retail brands are increasingly selecting natural fibres that are produced in an ethically and environmentally sustainable way. Within Australia, we also see an opportunity for Australian and global brands to use cotton grown in the country, and Cotton Australia is working hard to make that happen.

Organic cotton is set to witness greater demand in future. Are major cotton producing countries geared up for the same?

I can't speak on behalf of cotton growers in other countries, but I can say that a few cotton growers in Australia have experimented with organic cotton production in the past. It has not been economically viable to pursue organic cotton production in Australia. Here, organic cotton yields about one-third of conventional cotton, but uses the same amount of water. In Australia, water is precious and the major limiting factor to growing a crop. Producing a crop three times less water-efficiently doesn't make sense to Australian growers.

What are the challenges facing production of organic cotton?

Organic cotton production in Australia has been extremely limited in the past, and cotton growers who experimented with organic cotton production found that market demand and premiums were limited at the time. Unfortunately, the yields produced by organic cotton in the Australian growing environment were a fraction of those produced by more traditional methods and cotton varieties. The Australian cotton industry's commitment to science, technology and excellent farm and water management means: we are the highest-yielding cotton producer in the world, growing more crop per drop than any other nation. Much of our research efforts have been directed at improving water efficiency and maximising yield. So, unless demand for organic cotton increases dramatically over the short term, it is likely that Australian cotton growers will continue to produce high-yielding crops with current technology and methods rather than low-yielding, water use-inefficient organic cotton.

World cotton prices are predicted to fall in 2015, and consumption is expected to go up. Can we expect cotton consumption to grow as much as synthetic fibres on a global level?

Till date, price has been a significant factor in the consumption of fibres. When the price of cotton is lower than competing synthetic fibres, cotton consumption increases. However, we are starting to see new dynamics emerge in the world fibre market -- that is a growing preference by western consumers for sustainably and responsibly produced natural fibres. Although global economic and fibre market dynamics are far too variable to enable reliable prediction of cotton demand and pricing over the medium to long term, I am confident that this growing consumer trend will mean cotton will compete ever more effectively against synthetic fibres.

What is the consumption of cotton in Australia, and how are the prices behaving in Australia as compared to other parts of the world?

More than 99 per cent of Australia's cotton crop is exported to spinners and manufacturers overseas. Australian growers, via their merchants, participate in the global cotton market. So, growers here are directly impacted by world pricing mechanisms for cotton.

What are the biggest challenges for the cotton industry in Australia?

Cotton Australia works hard, on behalf of Australian cotton growers, to anticipate and overcome the big challenges facing the industry. Over the next year, the biggest challenges will include: 1. Water availability in cotton-producing regions; 2. Guiding research and development in order to increase efficiency and profitability of cotton production; 3. Maintaining and protecting grower access to key land and water resources; 4. Reducing the cost of key inputs such as electricity, which has been rising astronomically in recent years; 5. Building demand for our excellent fibre, both in Australia and around the world; 6. Advocating for favourable trade terms as the Australian government negotiates with trade partners.

What can be done to limit the impact of climate change on cotton yield?

Cotton Australia has an important role in guiding the cotton industry research and development, and we have helped the industry pursue scientific research into improving yields in order to make Australian cotton growers even more water-efficient. We are confident that these developments will continue to improve our growers' ability to make yield improvements, even as our climate evolves and access to water may become less certain. Last season, irrigated cotton in Australia averaged more than 11 bales per hectare.

What steps does Cotton Australia take to ensure greener footprint?

Since 1991, Australia’s cotton industry has been conducting independent audits and assessments of its environmental performance. Cotton Australia, in partnership with the Cotton Research & Development Corporation, late last year launched the Australian Grown Cotton Sustainability Report, the first report to be prepared according to Global Reporting Initiative guidelines. This report assesses the Australian cotton industry’s advancements in sustainable, water-efficient cotton production, and demonstrates the commitment to continuous environmental improvement by our growers.

How has the growth of e-commerce impacted marketing and communication?

Electronic marketing and communication have greatly increased our ability to tell the Australian cotton story to a global audience. While our electronic communication platforms can't replace valuable face-to-face contact, Cotton Australia has been able to use them to reach and communicate with completely new audiences. This has been particularly valuable for our Cotton to Market programme (which includes Cotton Leads and BCI), as this has enabled us to promote our responsibly produced fibre to the world via key retailers and brand owners.

What are the new trends expected to shape up marketing and communication in the next one year or so?

Cotton Australia remains committed to its Cotton to Market programme. Over the coming year, we will be attending numerous fibre and textile conferences and trade shows in order to share our story with people from around the world about Australian cotton's excellent qualities and the advantages of specifying it in their manufacturing and retailing processes. We'll also be expanding our electronic reach through websites, social media and active communications to reach an even wider audience.

Published on: 15/07/2015

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.