2008 and Beyond: Associations Prepare For Cotton’s Future
January 27, 2009 International Cotton Association’s new Managing Director Kai Hughes plans for greater membership service and growth for the association in upcoming years, and is currently evaluating how those goals can be achieved. Hughes served the association as general manager several years ago when the organization was the Liverpool Cotton Association, and since that time has worked with two universities in management positions focusing on strategic growth.
Hughes said his first goal would be to implement a plan for organizational development that would give the association the internal mechanisms to achieve its goals. After that structure is in place, he believes the ICA will be able to offer more value to its membership and be poised for growth.
“So my first priority would be to make sure that the organization is fit to purpose, and that is making sure that we have the right people in place to fulfill our strategy. My next goal would be to ensure that everything is done for our membership – that would be our priority. We want to make sure they get good service because the members pay a lot of money (for membership), and they need to get good value for that money,” Hughes said.
“This first year, we will have an internal focus, getting fit to purpose and ensuring that the association has clear goals, performance indicators, understands what the mission and vision is, and progressing that from an internal prospective.”
After that foundation is in place, membership growth, especially on the international front, will also be a top priority. Diversifying the membership to include not only merchants and spinners, but also ancillary businesses that aid the cotton trade, would also be a top priority. But for membership growth and sustainability, Hughes believes the association must adapt and change with the industry – all while remaining true to its fundamental purpose and mission.
“The ICA is an organization that is over 150 years old, and unfortunately, a lot hasn’t changed in those 150 years, and we want to bring it up to date and make sure we can do the business and provide value to members, so they see that this is an organization that is on the cutting edge of technology,” Hughes said.
“If you are going to attract new members, you have to have an organization that is slick, modern and forward-looking, and in order to do that, you have to ensure that the staff is like that, and that they have the systems in place to support them.”
International Cotton Advisory Committee Develops Strategic Objectives
The world cotton industry is witnessing strong demand growth, advances in technology and substantial progress toward liberalized trade in cotton textiles and apparel. By many measures, the health of the cotton industry is good. Nevertheless, many challenges continue, including: the need to encourage universal implementation of sustainable production systems; competition with polyester and the need to boost demand; distortions to production and trade caused by government measures in cotton; and continuing difficulties with contract defaults. In addition, the ICAC faces institutional challenges in boosting membership, a shift in attitudes toward public sector involvement in commodity matters, privatization of national cotton industry organizations and pressures on government budgets.
Cotton is grown in more than 100 countries on about 2.5% of the world’s arable land, making it one of the most significant crops in terms of land use after food grains and soybeans. Cotton is also a heavily traded agricultural commodity, with over 150 countries involved in exports or imports of cotton.
More than 100 million family units are engaged directly in cotton production. When family labor, hired-on farm labor and workers in ancillary services, such as transportation, ginning, baling and storage are considered, total involvement in the cotton sector reaches an estimated 350 million people. It also provides employment to additional millions in allied industries such as agricultural inputs, machinery and equipment, cottonseed crushing and textile manufacturing. Cotton cultivation contributes to food security and improved life expectancy in rural areas of developing countries in Africa, Asia and Latin America.
Cotton played an important role in industrial development starting in the 17th century and continues to play an important role today in the developing world as a major source of revenue. The value of world cotton production is estimated at approximately $40 billion in 2007/08. The economic importance of cotton justifies the involvement of governments in an international cotton organization dedicated to improving the health of the industry.
Because of cotton’s global impact and the importance of the ICAC in maximizing cotton’s development, ICAC current objectives include:
- Facilitating the development and encouraging the implementation of better management practices (BMP) that result in sustainable production of cotton.
- Encouraging increased consumption of cotton at the retail level.
- Encouraging worldwide adoption of a standardized instrument testing system for cotton.
- Supporting a successful outcome to negotiations in the Doha Round that will result in the elimination of all forms of export subsidies, improved market access for agricultural trade and reductions and eventual elimination of domestic support that distort production and trade.
- Insisting on adherence to good trade practices by all members of the cotton trade.
- Increasing membership by 5% to 46 governments within 5 years.
Bremen Could Adopt Arbitration for Instrument Testing
Parallel with the purchase of a new HVI line, the board of the Bremen Cotton Exchange has decided to recommend to the Bremen Cotton Exchange members the adoption of instrument arbitration in the Bremen Rules. So far the rules include only arbitration for micronaire. According to the concept, which will be put to vote on the next General Assembly in June 2008, the parties of a cotton contract basically can include every test parameter they consider appropriate or necessary. If there is a dispute, the rules now include criteria for the admissible test equipment and proceedings like HIVCCS or USDA Colour Calibration Tiles or CSITC arbitration procedures. Moreover, the rules refer to the control limits and deviations, the formalities of an application for instrument arbitration and the details of the testing procedure including an appeal against the first instrument test.
The advantage of the new rules is that additional parameters (such as stickiness or trash) which are currently not considered by the CSITC can theoretically be subject to arbitration with no further amendment of the rules.
It is important to note that the new rules are not mandatory and only applicable in cases in which parties have included instrument parameters in their contracts.
A new Uster HVI 1000 has been delivered and installed recently in the Exchange’s arbitration room. The facility is equipped with the newest air conditioning system in order to serve as a reference model for education and classing. With the new rules, the Bremen Cotton Exchange takes up an initiative by the International Cotton Advisory Committee (ICAC) to support the harmonization of testing procedures on the global level in the trading rules of the cotton associations.
India, Gdynia Associations Elect New Presidents
Marek Dominiak was elected the new president of the Gdynia Cotton Association earlier this year.
A 30-year veteran of the cotton trade, he has been running his own company dealing with cotton trade since 1991. TEXIM Marek Dominiak Registered Partnership is the agent for cotton trading companies such as Weil Brothers & Stern, Societe D’ Importation et de Commission, and Pagysa SA, as well as several Indian and Turkish companies trading cotton yarn and products.
Dominiak has also worked in Textilimpex Co. Ltd. where he was responsible for imports of raw cotton and yarn to Poland and represented Textilimpex’s interests in India, organizing cotton fiber, yarn and other Indian textile product purchases.
Also elected earlier this year, P. D. Patodia is the new president of the Cotton Association of India. He is also the Chairman of the Confederation of the Indian Textile Industry (CITI), an apex body of the Textile Industry in India, and he serves on various textile bodies and trade organizations including government bodies like Cotton Advisory Board and Technology Mission on Cotton.
Patodia has also been the Chairman of the Cotton Textile Export Promotion Council and Federation of Indian Export Organization. He has diverse business interest in cotton ginning, cotton trading in local and overseas markets, textile yarn exports, garment and apparel exports and real estate, with more than 45 years of experience in cotton and textiles.
Captions (2 photos):
Dominiak
Patodia
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