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  • 6.6.7-MARKET PROFILES-POSSIBLE NICHE MARKETS AND PRODUCT GROUPS

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  • Possible niche markets and product groups

    Chapter 6 - Market profiles - South Africa 

     
     
    The movement towards the use of organic cotton is being led by the South African retail chain, Woolworths who is currently the third largest consumer of certified organic cotton globally.* According to a report in Business Report (June 25 2007), the chains organic cotton clothing range is expected to turnover R30 million (US$4.3 million) in 2007 with a targeted turnover of R400 million (US$57.1 million) by 2012. At present the organic cotton for Woolworths is being sourced from India because there are no organic cotton farmers in South Africa. Woolworths is therefore working with Cotton South Africa to establish a commercially viable local organic cotton farming sector.

    Woolworths in partnership with Cotton South Africa will be launching experimental organic cotton trials in South Africa in 2008 in order to establish guidelines for growers. The process is expected to take time and production of commercially viable organic cotton could take up to 3 years. Woolworths will contract directly with these farmers to secure supply of quality product.

    Given the current status of the South African cotton industry, it is unlikely that the local industry will ever be able to satisfy the demand for organic cotton which creates a niche opportunity for suppliers who are able to meet Woolworth's stringent quality requirements. In the short term the opportunity is greater as at present there is no organic cotton grown in South Africa. Regionally, where there would be a tariff advantage, supply is also limited with Tanzania being the only SADC country capable of supply.

    *Woolworths press release, 19 November 2007.