UNITED NATIONS CONFERENCE ON TRADE AND DEVELOPMENT COMMODITIES AT A GLANCE « Special issue on Cotton in Africa » N°2 - July 2011 Printed at United Nations, Geneva–GE.11-51099–June 2011–250–UNCTAD/SUC/2011/2 UNITED NATIONS CONFERENCE ON TRADE AND DEVELOPMENT COMMODITIES AT A GLANCE « Special issue on Cotton in Africa » N°2 - July 2011 Note INTRODUCTION This issue of Commodities at a Glance has been prepared by the Special Unit on Commodities (SUC) of UNCTAD. This quarterly publication aims to collect, present and disseminate accurate and relevant statistical information linked to international primary commodity markets in a clear, concise and friendly format. Given the recent record rises in cotton prices and wider commodity price volatility, this edition of Commodities at a glance (n°2), will focus on the world cotton industry, with a special emphasis on African cotton producing countries. The cotton sector in Africa is critical to the provision of sustainable rural livelihoods and the economic development of these countries. This issue of Commodities at a glance with its focus on the African cotton sector has been prepared for the Pan-African Cotton Meeting in June 2011, in Cotonou (Benin). For further information about this publication, please contact the Special Unit on Commodities (SUC), UNCTAD, Palais des Nations, CH-1211 Genève 10, Switzerland, telephone +41 22 917 5676 e-mail: commodities@unctad.org. STATISTICAL DATA SOURCES All Statistical data sources for this publication have been indicated under each specific graph. Some discrepancies may appear in this document, especially between production and trade statistics due to the way information is reported by countries. The share of Africa in cotton lint exports both in 1985/86-1989/90 and 2006/07-2010/11 is higher than the share of Africa in cotton lint production. This situation is due to the fact that cotton is mainly grown as an export crop in Africa for international markets, while it is largely processed and domestically used in other regions. COPYRIGHT Material in this publication may be freely quoted or reprinted, but full acknowledgement is requested (UNCTAD, Special Unit on Commodities, Commodities at a Glance). A copy of the publication containing the quotation or reprint should be sent to the UNCTAD secretariat at: Palais des Nations, CH-1211 Geneva 10, Switzerland or by e-mail to: commodities@unctad.org. FREE SUBSCRIPTION The current publication is intended to be published on a quarterly basis. If you are interested in receiving its updated versions by e-mail on a regular basis, please send an e-mail to: commodities@unctad.org and we would be pleased to send it to you as soon as issued. UNCTAD/SUC/2011/2 2 2 Contents Note 2 MAKING NEWS THIS QUARTER 5 Facts and figures: International Cotton Market ____________________________ Fig 1. World cotton production and international cotton prices (1985/86 - 2010/11) Fig 2. (i) Share of cotton trade in global trade of all primary commodities (excl. Fuels), and (ii) ratio of the cotton price index vis-à-vis the price index of all primary commodities (excl. fuels), 1995 - 2009 Fig 3. Crude petroleum and fertilizer prices (January 1985 - March 2011) Fig 4. Euro / US dollar exchange rate (January 2000 - March 2011) 7 8 8 Facts and figures: Cotton Lint Production ________________________________ Fig 5. Average annual cotton lint production by region (1985/86 - 1989/90 and 2006/07 - 2010/11) Fig 6. World and African cotton lint production (1985/86 - 2010/11) Fig 7.a. African cotton lint production, as a Share of world production (1985/86 - 1989/90) Fig 7.b. African cotton lint production, as a Share of world production (2006/07 - 2010/11) Fig 8. Average annual cotton lint production by Africa’s top five producers (1985/86 - 1989/90) Fig 9. Average annual cotton lint production by Africa’s top five producers (2006/07 - 2010/11) 9 9 11 12 13 13 13 14 14 Facts and figures: Cotton Lint Yields ____________________________________ Fig 10. Cotton lint yields by region (1985/86 - 1989/90 and 2006/07 - 2010/11) Fig 11. World and African cotton lint production yields (1985/86 - 2010/11) Fig 12.a. Average cotton yields of African cotton producing countries vs. dependence on cotton exports (1995 - 1999) Fig 12.b. Average cotton yields of African cotton producing countries vs. dependence on cotton exports (2005 - 2009) Table 1. Ratio of average cotton yields of selected African countries to the World’s average (1985/86 1989/90) Table 2. Ratio of average cotton yields of selected African countries to the World’s average (2006/07 2010/11) 15 Facts and figures: Cotton Lint Marketing and Trade ________________________ Fig 13. Average annual cotton lint exports by region (1985/86 - 1989/90 and 2006/07 - 2010/11) Fig 14. Average annual cotton lint imports by region (1985/86 - 1989/90 and 2006/07 - 2010/11) Fig 15. World and African cotton lint exports (1985/86 - 2010/11) Fig 16.a. Africa cotton lint exports, as a share of world exports (1985/86 - 1989/90) Fig 16.b. Africa cotton lint exports, as a share of world exports (2006/07 - 2010/11) Fig 17. Average annual cotton lint exports by Africa’s top five exporters (1985/86 - 1989/90) Fig 18. Five main cotton lint exporting countries and the lowest export quantities in Africa (2006/07 - 2010/11) 19 Facts and figures: Value addition, cotton yarns ____________________________ Fig 19. Average annual cotton yarn production by region (1985 - 1989 and 2007 - 2011) Fig 20. World and African cotton yarn production (1985 - 2011) Fig 21.a. African cotton yarn production, as a share of world production (1985 - 1989) Fig 21.b. African cotton yarn production, as a share of world production (2007 - 2011) Fig 22. Average annual cotton yarn production by Africa’s top 5 producers (1985 - 1989) Fig 23. Average annual cotton yarn production by Africa’s top 5 producers (2007 - 2011) 23 Facts and figures: Value addition, cotton fabrics ___________________________ Fig 24. Average annual cotton fabric production by region (1985 – 1989 and 2007 - 2011) Fig 25. World and African cotton fabric production (1985 - 2011) Fig 26.a. African cotton fabric production, as a share of world production (1985 - 1989) Fig 26.b. African cotton fabric production, as a share of world production (2007 - 2011) Fig 27. Average annual cotton fabric production by Africa’s top 5 producers (1985 - 1989) Fig 28. Average annual cotton fabric production by Africa’s top 5 producers (2007 - 2011) 27 16 16 17 17 18 18 20 20 21 21 21 22 22 24 25 25 25 26 26 28 29 29 29 30 30 3 MAKING NEWS THIS QUARTER... 5 Making news this quarter... This quarter’s edition of UNCTAD’s Commodities at a Glance describes world cotton trade, price, production, and consumption trends, with a particular focus on Africa. The cotton sector is vital for at least 80 countries, of which 28 are in Africa, and accounts for around 2 per cent of the world’s arable land. Cotton production and processing is a critically important source of income and employment in developing countries, including the least developed countries (LDCs) in Africa. China, India, the United States and Pakistan are the main producers in the world, followed by Brazil and Uzbekistan, who altogether account for 80 per cent of world cotton production. African cotton lint production accounts for 5 per cent of world production (see figure 7b). Cotton is also a widely traded commodity, involving over 100 countries in both import and exports. Prior to 2008, the world cotton industry had been experiencing robust demand growth and rising yields. Over the last 60 years, cotton production once almost quadrupled, from 7 million tons in 1950/51 to 27 million tons in 2006/07, but declined thereafter to 22 million in 2009/10 (see figure 6). The introduction and adoption of new technologies and expansion of the area under cotton has resulted in significant production gains in the world. African cotton production peaked in 2004/05 (at around 2 million tons) and then declined by almost 50 per cent over the next five years (see figure 6). The African CFAF zone countries were hardest hit with production declines of 55 per cent between 2004/05 and 2008/09 as compared with a 20 per cent decline in SADC countries. Since 1985, world cotton yields have risen from around 500 kilograms per hectare to 800 kilograms. However, these productivity gains have not materialized in Africa. The productivity gap between world and African cotton lint yields has grown over the past 20 years, with average cotton yields in Africa at about half the world average. Yields in Africa have declined by 10 per cent during this period (see figures 10 and 11). Growth in Africa’s cotton production has not been based on productivity gains with declining yields being a key factor (see figure 10). In 2009/10 African cotton exports accounted for 12.5 per cent of world cotton lint exports, down from the 21 per cent share achieved in 2003/04. This situation represents a substantial loss of global market share over the past 5 years. Again, in terms of export performance, the CFAF zone countries were hardest hit with their cotton exports falling from 14 per cent of world cotton exports (71 per cent of African cotton exports) to 7 per cent (59 per cent of African cotton exports) during 2003/04 to 2009/10[1]. Finding a solution to the cotton issue might facilitate the conclusion of the WTO Doha Round, and help African cotton producers achieve stable, predictable and fair prices on the world market. A particular issue for cotton producing African countries concerns “commodity dependence” as many countries have experienced unbalanced growth patterns due in part to the high concentration of merchandise exports in few commodities traded on often volatile world markets. Relying on a few commodities with uncertain profitability enhances their economic vulnerability. The cotton-led growth of many African countries has been negatively affected by the growing volatility of world prices, competing synthetic fibers, and cotton subsidies in the United States, Europe and China. Nonetheless, there are substantial growth opportunities for African cotton, although some challenges need to be addressed: (i) improving value addition (and quality), (ii) closing the productivity gap between Africa and other world producers through farm-level productivity and ginning efficiency; and (iii) supporting capacities and institutions through the capacity-building of stakeholders, and strengthening of governance structures. In the short-term, the main threats to the sustainability of the African cotton sector include: the US dollar:Euro exchange rate, OECD subsidies, a lack of access to finance and extension services, weak cooperatives / marketing systems and a lack of adapted risk management tools. All of these issues have to be addressed to enhance the prospects for the competitiveness of Africa’s cotton sector. [1] See European Union - Africa Partnership on Cotton update relating to the EU-Africa partnership on Cotton, June 2010. http://www.coton-acp.org/en/update-relating-european-union-africa-partnership-cotton-june-2010. 6 FACTS AND FIGURES International Cotton Market 7 Fig 1. World cotton production and international cotton prices 1985/86 – 2010/11 World cotton prices spiked in 2010/11 to double their average price of the last 35 years (1985/86). World production has increased slightly over the timeframe 30'000 4'000 3'500 25'000 3'000 2'500 15'000 2'000 1'500 10'000 US$ per ton '000 tons 20'000 1'000 5'000 500 World cotton production 2010/11 2009/10 2008/09 2007/08 2006/07 2005/06 2004/05 2003/04 2002/03 2001/02 2000/01 1999/00 1998/99 1997/98 1996/97 1995/96 1994/95 1993/94 1992/93 1991/92 1990/91 1989/90 1988/89 1987/88 1986/87 1985/86 - International cotton prices (right scale) Source: Cotton production: International Cotton Advisory Committee (ICAC) International Cotton Prices: computed from UNCTAD, UNCTADstat Note: Crop season – 01/08 to 31/07 of each year Fig 2. (i) Share of cotton trade in global trade of all primary commodities (excl. Fuels), and (ii) ratio of the cotton price index visvis-à-vis the price index of all primary commodities (excl. fuels), 1995 - 2009 The value of cotton trade has decreased relative to all primary commodities (excl. fuels) since 1995. Furthermore, the price of the cotton has decreased relative to prices of all commodities (excl. fuels). Both the increase in prices of other commodities and the decrease in cotton prices explain this trend. 1.6% 140% 1.4% 120% 1.2% 100% 1.0% 80% 0.8% 60% 0.6% 40% 0.4% 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 0% 1997 0.0% 1996 20% 1995 0.2% (i) (ii) 8 Source: Computed from UNCTAD, UNCTADstat Note: ratio computed from export value data statistics (SITC Rev 3, 263). Data available from 1995. Fig 3. Crude petroleum and fertilizer prices, January 1985 – March 2011 1'400 140 1'200 120 1'000 100 01-2011 01-2010 01-2009 01-2008 01-2007 01-2006 01-2005 01-2004 01-2003 01-2002 01-2001 01-2000 01-1999 01-1998 01-1997 01-1996 01-1995 01-1994 01-1993 01-1992 20 01-1991 200 01-1990 40 01-1989 400 01-1988 60 01-1987 600 01-1986 80 01-1985 800 US$ per barrel US$ per metric ton Fertilizer prices are closely linked to oil prices. They spiked in 2008 and continue to be high. C rude petroleum (right scale) Diammonium phosphates (DAP) Potassium C hloride Urea Source: UNCTAD, UNCTADstat for crude petroleum prices, WORLD BANK for fertilizers prices Fig 4. Euro / US dollar exchange rate January 2000 – March 2011 During most of the last decade, the Euro/US dollar exchange rate has hindered the competitiveness of cotton produced in the CFA region of West and Central Africa 1.5 Euro / US dollar exchange rate 1.4 1.3 Exports from C FA franc area more competitive 1.2 1.1 1.0 Exports from C FA franc area less competitive 0.9 0.8 0.7 0.6 Source: International Monetary Fund, International Financial Statistics 01-2011 07-2010 01-2010 07-2009 01-2009 07-2008 01-2008 07-2007 01-2007 07-2006 01-2006 07-2005 01-2005 07-2004 01-2004 07-2003 01-2003 07-2002 01-2002 07-2001 01-2001 07-2000 01-2000 0.5 9 FACTS AND FIGURES Cotton Lint Production 11 Fig 5. Average annual cotton lint production by region 1985/86 – 1989/90 and 2006/07 – 2010/11 The volume of cotton produced in Asia has increased by ca. 23% from 1985/86 to 2010/11. The volume of cotton produced in Africa has decreased by ca. 10% over the same period 20'000 18'000 16'000 '000 tons 14'000 12'000 10'000 8'000 6'000 4'000 2'000 America Asia 1985/86 - 1989/90 Source: UNCTAD computations from ICAC statistics 12 Africa Europe 2006/07 - 2010/11 Fig 6. World and African cotton lint production 1985/86 - 2010/11 African cotton lint production increased from the mid-1990s to the mid-2000s, but declined to preboom levels after 2004/05. World production rose during this time period. 2'500 30'000 25'000 2'000 1'500 15'000 1'000 '000 tons 10'000 500 5'000 World Africa (right scale) 2015/16 2014/15 2013/14 2012/13 2011/12 2010/11 2009/10 2008/09 2007/08 2006/07 2005/06 2004/05 2003/04 2002/03 2001/02 2000/01 1999/00 1998/99 1997/98 1996/97 1995/96 1994/95 1993/94 1992/93 1991/92 1990/91 1989/90 1988/89 1987/88 1986/87 1985/86 '000 tons 20'000 IC AC forecasts for the next crop seasons Source: UNCTAD computations from ICAC statistics Note: According to ICAC and USDA, world cotton lint production should strongly increase in 2011/12 (+8% for USDA and +10% for ICAC). Fig 7.a. African cotton lint production, as a Share of world production 1985/86 -1989/90 Fig 7.b. African cotton lint production, as a Share of world production 2006/07 – 2010/11 The share of African cotton lint production has contracted in the last 20 years as African production fell by 10% and world production rose by 26% Africa 7% Source: UNCTAD computations from ICAC statistics Africa 5% Source: UNCTAD computations from ICAC statistics 13 Fig 8. Average annual cotton lint production by Africa’ Africa’s top five producers 1985/86 – 1989/90 Cotton lint production volumes exhibit greater uniformity across the top 5 African producers in the last 20 years. 400 The production of the top 5 African producers is equal to 61% of the total African cotton production 350 300 '000 tons 250 200 150 100 50 Egypt Sudan C ôte d'Ivoire Zimbabwe Mali Source: UNCTAD computations from ICAC statistics Note: * 22 countries Average for other African producers* Fig 9. Average annual cotton lint production by Africa’ Africa’s top five producers 2006/07 – 2010/11 Changes in the ranking of the top 5 producers were due to: (i) the onset of civil strife disrupting trade flows in Sudan and Côte d’Ivoire; (ii) the introduction of GM cotton in Burkina Faso; and (iii) supportive sectoral and institutional reforms in Tanzania during the mid-1990s. The production of the top 5 African producers is equal to 54% of the total African cotton production 400 350 300 '000 tons 250 200 150 100 50 Burkina Faso Egypt Mali Source: UNCTAD computations from ICAC statistics Note: * 21 countries 14 Zimbabwe Tanzania Average for other African producers* FACTS AND FIGURES Cotton Lint Yields 15 Fig 10. Cotton lint yields by region 1985/86 – 1989/90 and 2006/07 – 2010/11 Average cotton lint production yields in Africa over the last 20 years were about half the world average. Yields have decreased in Europe and Africa by ca. 10% over the last 20 years. 1'200 1'000 kg/Ha 800 600 400 200 America Asia 1985/86 - 1989/90 Africa Europe World 2006/07 - 2010/11 Source: UNCTAD computations from ICAC statistics Fig 11. World and African cotton lint production yields 1985/86 - 2010/11 The gap between world and African cotton yields has grown over the last 20 years. 900 800 700 kg / Ha 600 500 400 300 200 100 World Africa Source: UNCTAD computations from ICAC statistics 16 2010/11 2009/10 2008/09 2007/08 2006/07 2005/06 2004/05 2003/04 2002/03 2001/02 2000/01 1999/00 1998/99 1997/98 1996/97 1995/96 1994/95 1993/94 1992/93 1991/92 1990/91 1989/90 1988/89 1987/88 1986/87 1985/86 - Fig 12.a. Average cotton yields of African cotton producing countries countries vs. dependence on cotton exports, 1995 - 1999 1'000 900 800 Egypt 150 million US$ C ôte d'Ivoire Ethiopia 300 million US$ Benin 90 million US$ C ameroon Sudan 80 million US$ Madagascar Zimbabwe Senegal Burundi Uganda Nigeria 400 Burkina Faso 135 million US$ C entral Afr. Rep. 20 million US$ Zambia 500 Mali 230 million US$ Togo 300 C had Tanzania 190 million US$ 0% 5% 200 100 Mozambique -5% 600 Yield (kg/Ha) 700 10% 15% 20% 25% 30% 35% 40% 45% 50% 55% 60% 65% 70% 75% 80% 85% 90% C otton export dependence (see notes) Source: UNCTAD computations from ICAC statistics (yields) and UNCTADstat (export revenues) Note: Dependence on cotton exports is calculated based on SITC rev 3: 263. The size of the bubbles is proportional to total cotton export revenues in US$. Data are available from 1995. Fig 12.b. Average cotton yields of African cotton producing countries countries vs. dependence on cotton exports, 2005 - 2009 1'000 Egypt 180 million US$ 900 Since 1985, Egypt is the African country with the highest level of productivity. Its crop is mainly based on irrigation. 140 million US$ C ameroon Sudan 170 million US$ Mali 230 million US$ Zimbabwe Nigeria Uganda Cotton lint exports account for a large share of total exports in Benin, Burkina Faso and Chad. Burkina Faso C ôte d'Ivoire Senegal 700 C had 100 million US$ Togo Mozambique Tanzania 40 million US$ 0% 5% 500 400 300 200 100 A large number of African countries rely upon cotton exports. -5% 600 Yield (kg/Ha) 300 million US$ Benin 800 10% 15% 20% 25% 30% 35% 40% 45% 50% 55% 60% 65% 70% 75% 80% 85% 90% C otton export dependence (see notes) Source: UNCTAD computations from ICAC statistics (yields) and UNCTADstat (export revenues) Note: Dependence on cotton exports is calculated based on SITC rev 3: 263. The size of the bubbles is proportional to total cotton export revenues in US$. 17 Table 1. Ratio of average cotton yields of selected African countries countries to the World’ World’s average (1985/86 – 1989/90) Rank Country Ratio compared to the world Rank Country Ratio compared to the world 1 Egypt 1.48 15 Zimbabwe 0.68 2 Morocco 1.08 16 South Africa 0.67 3 Côte d'Ivoire 1.04 Africa 0.66 World 1.00 17 Niger 0.54 4 Cameroon 0.93 18 Chad 0.51 5 Mali 0.90 19 Ghana 0.51 6 Tunisia 0.87 20 Zambia 0.36 7 Madagascar 0.84 21 Central Afr. Rep. 0.35 8 Ethiopia 0.80 22 Angola 0.35 9 Sudan 0.80 23 Kenya 0.31 10 Togo 0.79 24 Tanzania 0.27 11 Senegal 0.76 25 DRC 0.21 12 Burkina Faso 0.76 26 Nigeria 0.17 13 Benin 0.75 27 Mozambique 0.15 14 Burundi 0.73 28 Uganda 0.05 Source: UNCTAD computations from ICAC statistics Table 2. Ratio of average cotton yields of selected African countries countries to the World’ World’s average (2006/07 – 2010/11) 20 years ago, Egypt, Morocco and Côte d’Ivoire had production yields above the world average. Today, only South Africa and Egypt have production yields above the world average. However, yield disparities between African countries appear to have reduced. Rank 18 Country Ratio compared to the world 1 South Africa 1.25 2 Egypt 1.11 World 3 Rank Country Ratio compared to the world Africa 0.43 15 Malawi 0.39 1.00 16 Angola 0.38 Benin 0.58 17 Zimbabwe 0.37 4 Niger 0.57 18 DRC 0.35 5 Cameroon 0.56 19 Togo 0.35 6 Sudan 0.53 20 Guinea 0.34 7 Ghana 0.53 21 Central Afr. Rep. 0.32 8 Mali 0.51 22 Nigeria 0.29 9 Senegal 0.51 23 Tanzania 0.28 10 Burkina Faso 0.50 24 Uganda 0.26 11 Côte d'Ivoire 0.48 25 Kenya 0.26 12 Ethiopia 0.44 26 Zambia 0.24 13 Madagascar 0.44 27 Chad 0.23 14 Burundi 0.44 28 Mozambique 0.18 Source: UNCTAD computations from ICAC statistics FACTS AND FIGURES Cotton Lint Marketing and Trade 19 Fig 13. Average annual cotton lint exports by region 1985/86 – 1989/90 and 2006/07 – 2010/11 African cotton lint exports to the world has increased by ca. 26% over the last 20 years; exports from America increased by ca. 95%. 4'000 3'500 3'000 '000 tons 2'500 2'000 1'500 1'000 500 America 1985/86 - 1989/90 Asia Africa Europe 2006/07 - 2010/11 Source: UNCTAD computations from ICAC statistics Fig 14. Average annual cotton lint imports by region 1985/86 – 1989/90 and 2006/07 – 2010/11 The volume of cotton lint imported by Asia has more than doubled in the last 20 years, mainly due to Chinese imports. African imports continue to be marginal 7'000 6'000 '000 tons 5'000 4'000 3'000 2'000 1'000 America 1985/86 - 1989/90 20 Asia 2006/07 - 2010/11 Source: UNCTAD computations from ICAC statistics Africa Europe Fig 15. World and African cotton lint exports 1985/86 - 2010/11 In line with the fall in production, African cotton lint exports increased from the mid-1990s to the mid-2000s, but have declined to pre-boom levels since 2005/06. 12'000 1'800 1'600 10'000 1'400 1'200 1'000 6'000 800 4'000 '000 tons '000 tons 8'000 600 400 2'000 200 World 2010/11 2009/10 2008/09 2007/08 2006/07 2005/06 2004/05 2003/04 2002/03 2001/02 2000/01 1999/00 1998/99 1997/98 1996/97 1995/96 1994/95 1993/94 1992/93 1991/92 1990/91 1989/90 1988/89 1987/88 1986/87 1985/86 - Africa (right scale) Source: UNCTAD computations from ICAC statistics Fig 16.a. Africa cotton lint exports, as a share of world exports 1985/86 -1989/90 Fig 16.b. Africa cotton lint exports, as a share of world exports 2006/07 – 2010/11 The share of Africa in world cotton lint exports both in 1985/86-1989/90 and 2006/07-2010/11 is higher than the share of Africa in world cotton lint production. This situation is due to the fact that cotton is mainly grown as an export crop in Africa and exported as such to international markets, while it is largely processed and internally used in other regions. Despite an increase in export quantities by ca. 20’000 tons, the share of African cotton lint exports has contracted in the last 20 years. During the “boom period” (1995/96 – 2005/06), Africa’s export share in the world was 18%. Africa 15% Source: UNCTAD computations from ICAC statistics Africa 13% Source: UNCTAD computations from ICAC statistics 21 Fig 17. Average annual cotton lint exports by Africa’ Africa’s top five exporters 1985/86 – 1989/90 The exports of the top 5 African exporters was equal to 61% of total African cotton exports. 250 200 '000 tons 150 100 50 Sudan Egypt C ôte d'Ivoire Mali Zimbabwe Average for other African exporters* Source: UNCTAD computations from ICAC statistics Note: * 18 countries Some discrepancies may appear in this document, especially between production and trade statistics due to the way information is reported by countries. Fig 18. The Five main cotton lint African exporting countries 2006/07 – 2010/11 Changes in the ranking of the top 5 exporters were due to: (i) the onset of civil strife disrupting trade flows in Sudan and Côte d’Ivoire, and (ii) the introduction of GM cotton in Burkina Faso. The exports of the top 5 African exporters was equal to 58% of total African cotton exports. 250 '000 tons 200 150 100 50 Burkina Faso Mali Benin Zimbabwe Egypt Average for other African exporters* Source: UNCTAD computations from ICAC statistics Note: * 19 countries Some discrepancies may appear in this document, especially between production and trade statistics due to the way information is reported by countries. 22 FACTS AND FIGURES Value addition – Cotton Yarns 23 Fig 19. Average annual cotton yarn production by region 1985 – 1989 and 2007 - 2011 Cotton yarn production has been multiplied by 3.6 in Asia/Oceania over the last 20 years. This is mainly due to: (i) the rapid growth in demand for cotton products in Asia (especially, China); and (ii) improved infrastructural, industrial and technological conditions. In contrast, in Africa the volume of yarn production remains marginal relative to the continent’s lint production. 35'000 32'090 30'000 '000 tons 25'000 20'000 15'000 8'928 10'000 5'000 3'821 2'298 2'429 472 330 788 America 1985 - 1989 Asia / Oceania 2007 - 2011 Source: UNCTAD computations from ICAC statistics 24 Africa Europe Fig 20. World and African cotton yarn production 1985 - 2011 While the volume of yarn produced in the world has almost tripled over the last 20 years, production in Africa has halved since the early 1990s, largely due to the low adoption of new technologies, declining yields, climatic variability and low ginning capacity. 40'000 600 35'000 500 30'000 400 20'000 300 15'000 '000 tons '000 tons 25'000 200 10'000 100 5'000 World 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1991 1990 1989 1988 1987 1986 1985 - Africa (right scale) Source: UNCTAD computations from ICAC statistics Fig 21.a. African cotton yarn production, as a share of world production 1985 - 1989 Fig 21.b. African cotton yarn production, as a share of world production 2007 - 2011 The share of African cotton yarn production has contracted in the last 20 years to 1% of global production Africa 3% Source: UNCTAD computations from ICAC statistics Africa 1% Source: UNCTAD computations from ICAC statistics 25 Fig 22. Average annual cotton yarn production by Africa’ Africa’s top 5 producers 1985 – 1989 The yarn production of Africa’s top producer, Egypt, has fell by 50% over the last 20 years. This is mainly due to: (i) the decrease in demand for Egyptian cotton (considered a luxury product); (ii) a decline in the amount of land under cotton; and (iii) the removal of subsidies and privatization of the sector in the mid-1990s. The production of the top 5 african producers accounts for 88% of total African cotton yarn production. 300 250 '000 tons 200 150 100 50 Average for other African cotton yarn producers* Cote d'Ivoire Algeria South Africa Morocco Egypt - Source: UNCTAD computations from ICAC statistics Note: * 10 countries Fig 23. Average annual cotton yarn production by Africa’ Africa’s top 5 producers 2007 – 2011 Nigeria and Tanzania have joined the ranks of the top five producers. In Nigeria, this was due to: (i) higher cotton seed prices; (ii) lower producer prices for competing crops since 2000; and (iii) various government stimulus measures for cotton producers. In Tanzania, sectoral and institutional reforms have been implemented during the 1990s. The production of the top 5 african producers accounts for 86% of total African cotton yarn production. 300 250 '000 tons 200 150 100 50 South Africa Tanzania Nigeria Source: UNCTAD computations from ICAC statistics Note: * 13 countries Average for other African cotton yarn producers* 26 Morocco Egypt - FACTS AND FIGURES Value addition – Cotton Fabrics 27 Fig 24. Average annual cotton fabric production by region 1985 – 1989 and 2007 - 2011 Cotton fabric production has almost tripled in Asia/Oceania over the last 20 years. This is mainly due to: (i) the rapid growth in demand for cotton products in Asia (especially, China); and (ii) improved infrastructural, industrial and technological conditions. In contrast, in Africa, the volume of cotton fabric production has increased only slightly and remains marginal relative to the volume of lint produced. This is largely due to the low adoption of new technologies, declining yields, climatic variability and low ginning capacity. 18'000 15'728 16'000 14'000 '000 tons 12'000 10'000 8'000 5'566 6'000 4'000 2'391 2'000 1'381 1'324 241 260 701 America 1985 - 1989 Asia / Oceania 2007 - 2011 Source: UNCTAD computations from ICAC statistics 28 Africa Europe Fig 25. World and African cotton fabric production 1985 - 2011 The volume of fabric produced in the world has almost doubled over the last 20 years. Production in Africa has remained relatively stable with a significant dip in the late 1990s and a speedy recovery in 2004, mainly due to the reduction of cotton lint and yarn production in Africa (see figures 6 and 22). 25'000 300 250 20'000 15'000 150 10'000 '000 tons '000 tons 200 100 5'000 50 World 2'010 2'009 2'008 2'007 2'006 2'005 2'004 2'003 2'002 2'001 2'000 1'999 1'998 1'997 1'996 1'995 1'994 1'993 1'992 1'991 1'990 1'989 1'988 1'987 1'986 1'985 - Africa (right scale) Source: UNCTAD computations from ICAC statistics Fig 26.a. African cotton fabric production, as a share of world production 1985 - 1989 Fig 26.b. African cotton fabric production, as a share of world production 2007 - 2011 The share of African cotton fabric production has contracted in the last 20 years to 1% of global production. Africa 3% Source: UNCTAD computations from ICAC statistics Africa 1% Source: UNCTAD computations from ICAC statistics 29 Fig 27. Average annual cotton fabric production by Africa’ Africa’s top 5 producers 1985 – 1989 Cotton fabric production is highly concentrated in Africa and this trend has increased over the last 20 years. The production of the top 5 african producers accounts fo 75% of total African cotton fabric production. 140 120 '000 tons 100 80 60 40 20 Average for other African cotton fabric producers* Zambia Tanzania Morocco South Africa Egypt - Source: UNCTAD computations from ICAC statistics Note: * 10 countries Fig 28. Average annual cotton fabric production by Africa’ Africa’s top 5 producers 2007 – 2011 Cotton fabric production has tripled in Tanzania and dramatically declined in Egypt and South Africa. Nigeria has emerged as a significant producer of fabric. In Egypt, the decrease is mainly due: (i) the decline in the demand for Egyptian cotton; (ii) a decline in the amount of land under cotton; and (iii) the removal of subsidies and privatization of the sector in the mid-1990s. 140 The production of the top 5 african producers accounts for 90% of total African cotton fabric production. 120 '000 tons 100 80 60 40 20 30 Average for other African cotton fabric producers* South Africa Source: UNCTAD computations from ICAC statistics Note: * 11 countries Nigeria Morocco Egypt Tanzania - UNITED NATIONS CONFERENCE ON TRADE AND DEVELOPMENT COMMODITIES AT A GLANCE « Special issue on Cotton in Africa » N°2 - July 2011 Printed at United Nations, Geneva–GE.11-51099–June 2011–250–UNCTAD/SUC/2011/2