Cotton Supply Chain Risks Persist Despite Sustainability Push

Environmental and social risks in the global cotton industry remain deeply entrenched despite growing momentum behind circular fashion models, according to a comprehensive lifecycle assessment published by Textile Exchange.

The study, which evaluates cotton production and recycling systems across major producing countries, highlights fertilizer use, irrigation and energy consumption as the primary drivers of environmental impact, underscoring the structural challenges facing the industry.

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Nitrogen-related emissions from fertilizer application were identified as a major contributor to both climate change and eutrophication, while irrigation practices significantly influence water consumption and energy demand. These impacts vary widely depending on local climate conditions, water-use efficiency and farming techniques, complicating efforts to standardise sustainability benchmarks globally.

“Environmental impacts associated with cotton cultivation are shaped by systemic drivers that cut across impact categories,” the report said, noting that yield levels play a key role in determining per-unit environmental performance.

Pesticide use further adds to the complexity, particularly in relation to ecotoxicity, with outcomes highly sensitive to both chemical inputs and modelling assumptions.

The study also maps the geographical scope of cotton systems, showing significant variation in production types and recycling streams across countries. Major producers such as China, India, Türkiye and the United States feature across multiple categories, including conventional, organic and regenerative systems, while recycled cotton streams, particularly post-industrial and post-consumer waste, are unevenly distributed across regions.

Geographical Scope of Cotton Systems

Source:  Textile Exchange

Also read: Cotton Brazil Engages Global Industry Leaders at Bremen Cotton Week Conferences

The table highlights that countries such as Türkiye have the broadest coverage across all categories, including post-consumer recycling, while others like Bangladesh and Pakistan are more concentrated in specific waste streams. This uneven distribution reflects differences in infrastructure, industrial capacity, and waste management systems, which in turn influence environmental outcomes.

Recycled cotton, often positioned as a lower-impact alternative, was found to face its own set of constraints. Electricity consumption and transportation emerged as the dominant drivers of environmental impact, particularly for post-consumer waste, which requires additional sorting, cleaning, and processing steps.

These additional stages increase energy demand and material losses, challenging assumptions that recycled fibres consistently offer lower environmental impacts. The study also noted that international transport of textile waste can significantly increase emissions, pointing to the need for more localised recycling systems.

Beyond environmental metrics, the report highlights persistent social risks within cotton supply chains. While progress has been made in areas such as gender equality, awareness-building and efforts to address child labour, challenges remain.

The study identifies ongoing concerns related to forced labour, wage disparities and geopolitical instability, alongside the growing impact of climate change on farming communities. These factors continue to shape the social dimension of cotton production and complicate sustainability efforts.

The lifecycle assessment also incorporates broader indicators such as soil health and biodiversity. Using soil organic carbon as a proxy, the study suggests that practices such as reduced tillage and increased organic inputs can improve long-term soil resilience. However, it cautions that these findings are based on generalised assumptions and may not capture local variability.

Biodiversity impacts were assessed indirectly through indicators such as land use, water consumption and pesticide use. While reducing these pressures is expected to lower biodiversity risks, outcomes remain highly site-specific and difficult to quantify.

A key limitation identified in the report is the variability and uncertainty in data. Differences in regional datasets, methodological assumptions and system boundaries make direct comparisons between conventional, organic and regenerative cotton systems challenging.

For recycled cotton, the lack of standardised data and inconsistencies in defining system boundaries further complicate analysis. The study cautions against simplistic rankings or claims based on lifecycle results, noting that outcomes are highly sensitive to context.

To address these challenges, Textile Exchange recommends improving input efficiency in cotton cultivation, particularly through better nitrogen management, reduced reliance on high-impact fertilizers and wider adoption of integrated pest management practices.

Reducing water and energy use in irrigation systems is also identified as a priority, alongside the transition to renewable energy in processing stages such as ginning.

In recycled systems, the study highlights the importance of shifting to renewable electricity and increasing domestic processing of textile waste to reduce transport-related emissions.

The findings come as the fashion industry accelerates its transition towards circular business models, including rental and resale, aimed at extending product lifecycles and reducing dependence on virgin materials.

However, the report suggests that these downstream innovations may not be sufficient to offset the environmental impacts embedded in upstream production systems.

Cotton remains one of the most widely used fibres in the apparel industry, making its environmental footprint a critical factor in achieving broader sustainability goals. As a result, addressing production-level impacts will be essential to ensuring that circular models deliver meaningful environmental benefits.

While the study represents a significant step forward in improving data transparency and methodological consistency, it concludes that meaningful progress will require coordinated action across the entire value chain, from farm-level practices to processing infrastructure and global logistics.