Forced Labor and Banned Cotton, 19th Century Style
Forced labor in the world’s cotton supply chain continues to make headlines. Major apparel brands, including LL Bean, Hugo Boss, and Uniqlo, are taking a hard look at their cotton supply chains for chain-of-custody failures associated with forced labor. Dependable raw cotton supply persists as an ongoing challenge for sourcing managers from Europe to the Americas to Asia.
The U.S. government has now blocked Chinese cotton exports here. This move against China is serious - it's the world’s #1 cotton producer - and was applied because of China's continued use of forced Uighur labor to produce Xinjiang cotton. Other cotton producing countries, including Uzbekistan and Turkmenistan, also have forced and child labor issues. Meanwhile India (the world’s #2 cotton producer) struggles with its high cotton farmer suicide rate, which NGOs link to the systematic removal of indigenous varieties, and the shift to biotech seed monopoly “enslavement”. Human rights groups have responded, with measures such as the Cotton Campaign, the Uzbek Cotton Pledge and other responsible sourcing measures.
The problem of forced labor in the world’s cotton supply chain is not a new one, nor is a ban on imports as a social justice response.
Over 150 years ago, the Lancashire Cotton Famine made worldwide headlines and was part of the textile industry’s worst depression up to that time.
In 1861, cotton was “king”. As the basis for the world’s greatest manufacturing industry, it helped employ over 20 million people globally. In England, the richest country at the time, about 1 in 4 families depended on the cotton textile industry for survival. Over 2,500 factories, located primarily in the north (Manchester and Lancashire), produced so much cotton yarn and fabric it comprised fully one-half of England’s total exports for the year.
Where did England get its raw cotton? America’s plantation system supplied over 75% of it. Our long staple “Sea Island Cotton” was coveted then (as it is today).
When the American Civil War started that year, it marked the end of the South’s plantation cotton economy, which was based on the unpaid labor of nearly 2 million enslaved people. The U.S. government employed its vast navy to blockade all southern (Confederate) ports. Cotton rotted on the docks. Within a year the world’s most valuable supply chain was devastated, and England’s economy plunged into crisis. An unprecedented depression followed.
What is most fascinating today, perhaps, is not the ruin and subsequent rebuilding that ensues after the Civil War, but how social dynamics helped shape the economy which emerged afterwards. For even though the factory workers of Lancashire were literally starving, they supported the abolition of slavery, and thus the U.S. embargo on southern cotton. After months of famine and mass unemployment, widely publicized at the time, the workers of Manchester and Lancashire held fast to their anti-slavery beliefs. In 1863, the depths of the Civil War and its carnage, President Lincoln wrote a stirring letter thanking these factory workers for their “heroism” on behalf of “human rights.”
By 1864, the price of raw cotton had quadrupled. British supply managers in India forced small farmers to convert to cotton. When U.S. sources came back online after the American Civil War ended in 1865, the price of raw cotton collapsed. The small cotton farmers of India were left destitute. Part of the old story of how volatility can lead to supply chain uncertainty, price spirals, and a changed marketplace.
Some other aspects of the Lancashire Cotton Famine remain pertinent today:
Industrial globalization suffers due to instability in faraway nations
A rush to counter-source, to the benefit of emerging suppliers
Workers revolt to protest inept or missing government leadership
The world’s apparel supply chain remains in the public eye, which comes with the job if you are a sourcing professional these days. Doing this requires up-to-the minute information on politics, public health, commodities, top-and-bottom line thinking - and an appreciation for textile industry history comes in handy, too.