Climate change is coming for fashion’s supply chains #587

2022/14/11

Extreme and unpredictable weather events are becoming increasingly common, with knock-on effects for fashion’s natural fiber supply. Experts say regenerative agriculture, circular business models, and increased traceability could help mitigate risks.

Ahead of the United Nations climate change conference, COP27, which kicked off in Sharm-El-Sheikh last week, the UN World Meteorological Organization released a provisional report on the state of extreme weather events. The outlook is bleak. According to the report, extreme heatwaves, drought, and devastating flooding have affected millions and cost governments, citizens, and businesses billions this year — and the impact of climate change is only set to intensify without radical action.

These extreme events are already affecting fashion’s supply chains. Unusually strong monsoon rains ravaged Pakistan between June and September this year, with floods affecting over 30 million people and around 40 percent of the annual cotton yield, according to the Government of Pakistan. Meanwhile, in the US — the largest cotton exporter globally — the Department of Agriculture is forecasting a 28 percent annual decline in supply due to drought in Texas. Other top-producing countries, including India, Brazil, China, and Turkey — which produce silk, wool, and forest fibers — are at risk, as well as South Asia and Africa, where cashmere, sisal, and jute are produced, says Shameek Ghosh, co-founder, and CEO of supply chain traceability platform TrusTrace.

“Right now, we’re seeing the volatility of natural fiber supply increase due to extreme weather,” says Ghosh. “We need to wake up to the fact that everything is at risk, and we will need to continuously manage and work on step-by-step reduction of this risk going forward.”

Potential risks vary by fiber, according to the Just Fashion Transition report compiled by think-tank and management consulting company The European House – Ambrosetti for the inaugural Venice Sustainable Fashion Forum. Cotton is often described as a thirsty crop, with lower yields caused by high temperatures or limited water availability. There could be fewer cows to produce leather if areas are subject to extreme and prolonged droughts, and sheepskin is vulnerable to pests and diseases with temperatures rising. Cashmere goats, pashmina goats, and vicuña — which produce some of the world’s most expensive natural fibers — could see their habitats restricted and degraded due to climate change. Silk is jeopardized by temperature rises and humidity fluctuations, too.

The impact of climate change on fashion supply chains reaches far beyond fiber production; there is also a potential humanitarian crisis at hand, Better Cotton said in an update posted to its website. In light of recent events, farmers reliant on cotton production for their livelihoods will receive support from Better Cotton and its partner organizations, including financial assistance to help fund field workers’ home rebuilds, medical support through mobile clinics, mosquito nets (due to a high outbreak of dengue fever in flooded areas), and seeds for farmers for the next cotton season.

In addition to these short-term fixes, experts say, fashion will need to implement future-facing solutions, including regenerative agriculture, diversifying supply chains across climates, and reducing its use of new natural fibers.

Extreme weather events might destroy part of a harvest, or impact the ability of a region to transport, use and sell harvested goods,” says Gregor Leckebusch, professor of meteorology and climatology at the University of Birmingham and co-chair of the The Met Office Academic Partnership, a collaboration between UK academics and the weather forecasting agency to help build resilience to high-impact weather events and climate change. “The severity also depends on a region’s ability to rebuild after these events happen, which is generally reduced in areas with more intense or frequent events.” Brands can assess the climate resilience of producing regions and their ability to bounce back or endure extreme weather, but predicting exactly when and how these will strike is not yet possible.

Mapping climate risks

To understand the climate risks in their supply chains, brands first need to invest in transparency and traceability, says Ghosh. This can help them map vulnerable regions, as well as ensure ethical practices.

Mapping risks is complicated by the fact that extreme weather events can be triggered by neighboring regions and earlier events, says Leckebusch. “If there is less precipitation from Spring into Summer, the soil will be dryer. If you then have a lot of sun, there is less water in the soil to evaporate and less ability to produce clouds, so more radiation reaches the ground and a heatwave builds up. Added to that, a heatwave may affect more than one country.”

Whether growers can maintain their yield is only one part of the equation, continues Leckebusch. Extreme weather could also impact where garments are sold, and how people in those regions need to dress.

Building climate resilience

Brands can diversify their supply chains, so extreme weather in one region doesn’t undermine their entire supply of a certain fiber. Following floods in Pakistan and drought in Texas, Better Cotton will be supplementing the shortfall with imports from Brazil, Australia, and the US. While flexibility helps brands endure supply chain disruptions, they also have a responsibility to support growers, says Ghosh. “Moving towards sustainable supply chains is not just securing supply, it’s ensuring sustained health and livelihoods in all the communities involved.”

Once brands have oversight of their supply chains, they can start to form closer relationships with growers, gathering data on changes in climate and extreme weather risks as they unfold. “Establishing these relationships and building trust will require a new approach, where it is a partnership with a win-win mentality,” says Ghosh

The wool supply chain is leading in this approach. The New Zealand Merino Company is developing ZQRX, a network of wool growers using regenerative practices and connecting them with brands looking for traceable supply chains and lower impacts. Its growers report increasingly unstable and unpredictable weather conditions, which is affecting supply. Richard and Annabelle Subtil, who run 19,000 Merino sheep across 12,000 hectares on Omarama Station, are long-term suppliers of VF Corp-owned brand Icebreaker. They say in 2022, historic flooding wrecked the area, and $150,000 NZD of repairs are needed to their farm and property.

“A big part of our work is building more resilient farms and supporting growers to bounce back after those events, to disrupt the supply chain and farm business as little as possible,” says Dave Maslan, general manager of markets and sustainability for ZQRX. To help temper extremes, the organization is helping growers transition to holistic farming methods, focusing on soil resilience. This includes shifting grazing practices, so soil retains moisture and can store more carbon. One of the challenges is measuring impact — there is currently no agreed methodology for this in regenerative agriculture, but Maslan says perfection shouldn’t hinder progress. “It’s hard to manage what you can’t monitor, but we know we can create net positive outcomes, even if we can’t measure them to three decimal places.”

In the UK, a certification body and non-profit Pasture for Life works with regenerative farmers rearing pasture-fed livestock. British brand Peregrine has committed to using 100 percent regenerative wool from Pasture for Life farmers by 2026. On leather, Pasture for Life is working with a new venture Grady + Robinson, which is building a regenerative, transparent, and traceable supply chain from scratch. “Weather patterns have changed and we don’t get as much summer rain as we used to, so we’ve had to adapt our practices,” says UK farmer Edward Langrish, one of 900 members in Pasture for Life’s growing network. The farm now has more chicory, clover, and plantain, deeper-rooting grasses that benefit from rest time to grow, and new water systems in place. “It’s completely changed our pastures. Land that previous tenants told us was rubbish — nothing grew, sheep didn’t do well — now looks amazing and grows crops most of the year.”

Pasture for Life executive director Jimmy Woodrow says the knock-on effects of these changes are significant as well. Drought-impacted soil can’t sustain as many animals or requires feed to be transported, which requires fossil fuels. Animal nutrition is affected as well, with sheep raised on dryer land producing finer fibers, says Woodrow.

farmers need to be incentivized to change their practices. One of the key issues right now, says Woodrow, is that eco-labelling — voluntary labels marking products as ethical or sustainable — generally uses global data on the impact of agriculture, so statistics for cow leather might factor in rainforest deforestation in Brazil to make space for cattle and apply these globally, and local changes UK farmers are making won’t be factored in. This means farmers aren’t necessarily recognized for the work they’re doing to minimize negative impacts and brands struggle to make claims about their products. Brands forming longer-term partnerships with farms can include transitioning to regenerative practices in the contracts, and supporting growers with the necessary investments by promising to buy a certain percentage of their yield for a certain number of years. “If brands don’t provide long-term stability for growers, they won’t have wool to buy,” adds Woodrow.

In Mongolia, extreme climate events are becoming more frequent, increasing mass livestock mortality and biodiversity loss, and making cashmere herders more vulnerable to food insecurity and forcing them to migrate to the outskirts of the capital city where their job prospects remain low, says Zara Morris Trainor, head of research and policy at Sustainable Fibre Alliance (SFA). Through its SFA Cashmere Standard, the organization has been training herders on rangeland management and risk preparedness, as well as providing microfinance solutions and preferred loans for certified herders. Cashmere brand Oyuna has committed to only using SFA-certified cashmere, and donates one percent of each online sale to member herders, says founder Oyuna Tserendorj.

Moving away from natural fibers, responsibly

As natural fiber production becomes more volatile, the competition for productive land between food and fibers is also increasing. Brands might consider reducing new fibre production and investing more in next-gen and recycled alternatives, says Nicole Rycroft, founder and executive director of environmental non-profit Canopy. “With climate change and the biodiversity crisis, the natural world is less resilient and able to meet the volume of demand.” She recommends brands look to reduce their new fiber consumption, switch to circular business models, and — when new fibers are necessary — use lower impact materials as feedstock.

As fashion reckons with its over-reliance on cotton, man-made cellulosics including viscose have become increasingly popular, but Rycroft says this is putting pressure on forests, which we should be protecting instead. “Forests are 30 percent of the climate solution and 80 percent of the habitat for terrestrial biodiversity globally. What’s projected is spikes in the cost of wood, so textiles like viscose — unless there’s a transition to more circular feedstock like agricultural residues, industrial food waste products, or waste textiles — will also be a shrinking pool. This linear, extractive model will be increasingly prone to failure,” she says.

According to Canopy, 200 million trees are cut down to make viscose, rayon, and manmade cellulosic every year, slated to at least double in the next decade. Ancient and endangered forests are especially important for climate resilience and biodiversity, including Indonesia, Southeast Asia, Brazil, and the Democratic Republic of the Congo, as well as temperate forests in Chile and Canada. In October, over 500 brands, including Stella McCartney, H&M, Zara, PVH, and Kering, committed to the CanopyStyle pledge to keep forests out of their supply chains.

Many forest landscapes are rich in carbon, so carbon credits could be a critical tool in ensuring long-term stewardship, says Rycroft. Right now, this industry is a Wild West, she says, but with reform, it could secure livelihoods for local communities. She also suggests building next-gen fiber facilities next to these areas, so there is a profitable alternative to logging and prosperity is shared with communities on the ground.

“Brands should be investing in supply chain transformation, regenerative agriculture, securing the conservation of forest ecosystems, and growing next-gen material companies.”

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