**TESTIMONY OF LA RHEA PEPPER**

**PRESIDENT, ORGANIC ESSENTIALS**

**BEFORE THE**

**HOUSE AGRICULTURE COMMITTEE, SUBCOMMITTEE ON HORTICULTURE AND ORGANIC
AGRICULTURE**

**WEDNESDAY, APRIL 18, 2007**

Good morning, Mr. Chairman, and members of the Subcommittee. My name is
LaRhea Pepper and I am the CEO of Organic Essentials in O'Donnell,
Texas. Organic Essentials manufactures organic cotton personal care
products such as cotton balls, swabs, and rounds. Until our recent sale
of part of our business, Organic Essentials was also the U.S.'s leading
manufacturer of organic cotton feminine hygiene products.

I am also an organic cotton farmer. My husband, Terry, and I farm 1,100
acres of organic cotton near Lubbock, Texas.

As such, I am very familiar with both the production and processing of
organic cotton and related products.

Many people are surprised when they hear about organic cotton. They know
about organic food, but apparel, home textiles and personal hygiene
products? You can't eat them, so why make them? So I'd like to step back
a bit and tell you about what organic cotton is, why it is so important
to the global environment, and how rapidly the market for organic fiber
products (note that other organic fibers are also available including
organic wool, organic linen, and organic silk).

How did my husband and I get into organic cotton production? Frankly, we
couldn't help ourselves. Stewardship of the land is my heritage and part
of my legacy.

By way of background, family farming in the early 1900's and through the
1960's brought health, wealth and prosperity to America. There was a
time when the farm supported the family.

When my grandfather started farming in the 1920's, he bought everything
he needed for \$1200. Over the years he sold the cotton he grew for
about 50 cents a pound. When my father started farming in the 1950's,
the situation had started to change. He had to pay \$4,500 for one
tractor and a cultivator and planter and sold his cotton for 35 to 50
cents. In 1979, Terry and I started farming and were able to buy one
used tractor for \$37,000 and sold cotton for 47 cents. Today, if we
could buy a new tractor, it would cost over \$100,000 and conventional
cotton is selling at

53 cents per pound. The reality is that the cost of cotton production
has increased significantly while the return has actually gone down
despite the technological advances.

In the 1980's, our family had to have someone working off the farm in
order to bring in enough income. This was a reality with many other
families as well. Times were changing and we needed to change as well.
But we didn't just leave one foot on the farm -- we started looking into
how to diversify the farm itself.

Given our commitment to being stewards of the land, and our concern
about the extensive use of pesticides on the 3.4 million acres of
conventional cotton all around us in the Lubbock area, we became
certified organic farmers in 1991. Organic production is based on a
system of farming that maintains and replenishes soil fertility without
the use of toxic and persistent pesticides and fertilizers and
genetically modified seeds. Our organic cotton is certified by the Texas
Department of Agriculture.

Since 1992, we have worked with other farmers in our area to establish a
market and educate consumers, brands and mills about the value of
organic agriculture and its products.

In 1993, we and a handful other family farmers came together to form the
Texas Organic Cotton Marketing Cooperative, or TOCMC ("TOKMAK").
Collectively, we grew about 1,000 acres of organic cotton that first
year, with a yield of 400 bales (roughly 200,000 pounds). Since then,
TOCMC has expanded to 30 family farmers growing 8,000 acres of organic
cotton in addition to 12,000 acres of organic corn, soybeans, and sesame
planted as part of the crop rotation which is required by law to build
the soil and reduce pest risks brought about from field after field of
the same crop (monocropping). Planting other crops also enables us in
our effort to remain diversified for economic reasons.

*The High Plains of Texas has since become the largest organic cotton
growing region in the United States and one of the largest organic
cotton growing regions in the world.*

From the beginning of the cooperative, TOCMC has sold our cotton for 75
cents to \$1.25 cents a pound based on quality and quantity. We do not
consider the higher price for organic a "premium," but instead a fair
return on the cost and the investment we have made in our crop. We have
openly communicated with our customers, letting them know we're not
profiting- we are covering our costs which include greater labor costs
and greater risks than in conventional cotton production.

We also work hard to educate brands about the value of organic cotton
production-- in order to be sustainable, agriculture must be
economically viable. Part of the sustainability equation has been that
the farm must be economically viable or it simply cannot operate! One of
the ways we educate brands is by holding annual Fall Field Days on our
farms.

The photo below shows representatives from companies including Nike,
Patagonia, Sportif and The Timberland Company attending these tours and
learning about organic cotton production.

![](media/image1.jpeg){width="5.3805555555555555in"
height="2.7604166666666665in"}

My husband, Terry, fourth from the left in the top row above, and
showing organic cotton seeds to representatives of Mountain Equipment
Coop, Nike and Sportif in the photo below (with another TOCMC organic
cotton grower Betty Bingham), loved to talk with the brands and was
proud that the organic cotton we and the other hardworking members of
TOCMC grow is making its way into apparel, home textiles and personal
care products sold across the nation and around the world.

![](media/image2.jpeg){width="3.8541666666666665in"
height="2.5972222222222223in"}

## 

## Unfortunately, Terry since developed a very aggressive form of brain cancer and passed away last Sunday which is why I cannot be with you today. Still others in our organic community may well be affected soon as well -- our neurosurgeon told us last week he is diagnosing new cases of brain tumors every week in the Lubbock, Texas area. 

## 

I note that according to the U.S. Department of Agriculture (USDA),
fifty five million pounds of pesticides were sprayed on the
approximately 12.4 million acres of conventional cotton grown in the
U.S. in 2005 (the most recent data available). This amounts to
approximately 5.8 pounds per acre treated, ranking cotton *third* behind
corn (162,424,000 pounds) and soybeans (77,203,000 pounds) in total
amount of pesticides sprayed in the U.S.[^1]

While we cannot prove that Terry's cancer stems from the millions of
pounds of pesticides used on cotton and other crops around us, we do
believe the federal government should be seriously investing in
alternative agricultural systems that are healthy for farmers, farm
families and communities across the country.

Not only would expanded organic cotton production help manufacturers
meet their need for organic cotton, but it will also help the nation
reach its goals of reducing air and ground and surface water pollution
while improving soil quality for future generations.

One of the unique attributes of the organic farmers that make up TOCMC
is that they are forward thinking and visionary. One of the first
initiatives they undertook was to develop the company "Organic
Essentials"
([www.organicessentials.org](http://www.organicessentials.org/)) in 1996
to create value-added products including feminine hygiene products,
cotton balls, swabs, and rounds (for make up removal) to use the 10% of
short staple (length) cotton fiber that falls outside of the spinning
qualifications and which we formerly had to sell at low prices on the
conventional market.

![](media/image3.jpeg){width="3.4993055555555554in"
height="2.6243055555555554in"}

By creating these products, we:

1.  Ensure diversification. We wanted to have a finished product in the
    marketplace so we could control sales from fiber to the finished
    product, and

2.  Educate consumers about the benefits of organic cotton. Products
    hold a lot of visual real estate on a store shelf making it a
    wonderful venue for educating the public.

I am proud to tell the Subcommittee that these products are now
available nationwide in venues ranging from natural food stores such as
Whole Foods and Trader Joe's to CVS and Wal-Mart.

In the late 1990's, I joined the Organic Trade Association's (OTA:
[www.ota.com](http://www.ota.com/) ) Fiber Council Steering Committee
and then the OTA Board where I shepherded the effort to create standards
that would govern the *processing* of organic cotton and other fibers.
The goal was to enable manufacturers to create finished garments and
home textiles that could be considered "organic" from field to finished
product. OTA finalized its Organic Fiber Processing Standards in 2003
and they have since been incorporated into the new Global Organic
Textile Standards or "GOTS"
(<http://www.imo.ch/imo_services_textile_gots_en.html>) just agreed to
by trade and certification organizations from Japan to the U.S. and
Europe. As such, there are now new and strong international voluntary
guidelines governing the processing of organic fiber products that cover
all stages of textile processing, from post-harvest handling, to:

-   Wet processing (bleaching, dyeing and printing)

-   Fabrication

-   Product assembly

-   Storage and transportation, and

-   Labeling of finished products.

That project in motion, the next step was to unite apparel and home
textile companies not only in the U.S. but around the world so as to
steer the organic fiber sector forward in a collaborative, coherent
fashion. In 2002, I helped co-found a non-profit organization, the
Organic Exchange (www.organicexchange.org), the goal of which was to
facilitate expansion of the global organic cotton fiber supply by
working closely with farmers, leading brands and retailers and their
business partners to develop organic cotton programs.

Organic Exchange has helped facilitate the use of organic cotton by
holding over 15 organic cotton conferences and trainings in supply chain
centers, including China, India, the Netherlands, Paraguay (this very
day!), Peru, Tanzania, Thailand, Turkey, the United Kingdom and the
United States. This year, we will also hold a regional training in South
Africa and our annual conference in Monterey, CA to which you are all
invited ([www.organicexchange.org](http://www.organicexchange.org/)).

As a result of the efforts of both the Organic Trade Association and the
Organic Exchange, use of organically grown cotton by retail titans,
fashion designers and small and medium size companies has resulted in a
dramatic growth in global retail sales of products containing organic
cotton.

According to the OTA, sales of U.S. and Canadian organic fiber products
jumped *40* percent in 2005, amounting to a \$160 million.

Furthermore, according to an OE report, in the four-year period of 2001
to 2005, *global* organic cotton product sales increased an estimated 35
percent annually, from \$245 million in 2001 to \$583 million in 2005.
OE projects global organic cotton product sales to skyrocket to \$2.6
*billion* by the end of 2008, reflecting a *116 percent average annual
growth rate.*

According to the report, the five brands using the most organic cotton
globally in 2005 were (in order by quantity): Nike (Oregon), Coop
Switzerland and Patagonia (California), Otto (Germany), and Sam's
Club/Wal-mart (Arkansas).

The names of companies using organic fiber today read like a Who's Who
in the apparel and home textiles industry: American Apparel
(California), Eileen Fisher (New York), Gaiam (Colorado), GAP
(California), Hanna Andersson (Oregon), H&M (Sweden), IKEA (Sweden),
Indigenous Designs (California), Loomstate (New York), Maggie's Organics
(Michigan), Marks & Spencer (United Kingdom), Monoprix (France),
Mountain Equipment Co-operative (Canada), Nordstrom (Washington), Norm
Thompson/Sahalie (Oregon), Of the Earth (Oregon), Organic Essentials
(Texas), People Tree (United Kingdom), Prana (California), REI
(Washington), Sportif USA (Nevada), The Timberland Company (New
Hampshire), Under the Canopy (Florida), Whole Foods (Texas) and
Woolworths South Africa.

Organic Exchange also identified more than 1,200 small and medium sized
brands and retailers offering organic cotton products in North American,
European and Asian consumer markets in 2005. Examples of some of the
wonderful organic cotton apparel available for children, women and men
are below (L-R, children's - Hanna Andersson; women's - Eileen Fisher;
men's - Patagonia).

![](media/image4.jpeg){width="1.3770833333333334in" height="1.625in"}
![](media/image5.jpeg){width="1.8611111111111112in" height="1.49375in"}
![](media/image6.jpeg){width="1.6597222222222223in"
height="1.6597222222222223in"}

In addition, designers such as Rogan Gregory, Katharine Hamnett and
Stella McCartney have included organic cotton garments in their
collections, while rock star Bono and his wife Ali Hewson, use organic
cotton in their Edun brand co-created with Gregory and launched in
2005. 

Sales locations include not only boutiques and specialty stores, but
also department stores such as Nordstrom's, natural food independent
grocery stores such as Whole Foods, the Internet, catalogs, and even
"Big Box" stores.

The tide is turning. More and more consumers, once they learn about the
impacts of conventional production systems, want to support products
that protect the highest quality of life. And unlike in the organic food
industry, where many manufacturers only got involved as a result of
consumer pressure, it is the CEO's, designers and product developers of
small to massive companies that are driving the increased use of organic
fibers.

All together, brands and retailers incorporated an estimated 19,945,200
pounds (or 42,552 bales) of organic cotton fiber into the products they
offered to consumers in 2005 from the 2004 harvest. We will have 2006
data this summer.

Organic cotton production and fiber sales to manufacturers also grew
during the 2001-2005 time period. Organically grown fiber production
increased from 14,285,938 pounds in the 2000-01 harvest to 68,380,699
pounds projected for the 2005-06 harvest, reflecting an average annual
growth rate of 76%.  Organic cotton was grown in 22 countries in
2004-05, led by Turkey (40 percent), India (25 percent), the United
States (7.7 percent -- grown in Texas, California, New Mexico and
Missouri) and China (7.3 percent). In 2005-06, these four countries are
expected to grow 79% of the global organic fiber crop. 

*Manufacturer demand for organic cotton fiber increased an estimated 93%
per year during this time period.*

The irony? There isn't enough organic cotton available today for the
number of brands that want to use it.

Another irony? The United States (led by Texas) used to be tied with
Turkey as the largest organic cotton production area in the world. But
the U.S.'s ranking has slipped and the growth in acreage today is
happening in Turkey, India and China. Quite frankly, everywhere *but*
the U.S.

Why is this incredible "growth" opportunity passing by the U.S.? We face
barriers such as:

1\. Insurance Policies:

Organic farmers pay a 5% higher multi-peril insurance premium for the
same coverage as conventional growers, which are based on conventional
cotton prices. Organic producers need an optional organic coverage level
reflecting the higher value of the organic crops.

2\. Risk for newcomers of having their crops decertified if sprayed by
the Boll Weevil Eradication Program:

Many of the farms where organic cotton is being grown in Texas and
Missouri are in Boll Weevil Eradication Zones. As most of the current
TOCMC member farmer families were already certified organic before the
eradication program was implemented, under the program's regulations
they would be compensated if their organic crops were treated. However,
until the boll weevil is determined *fully* eradicated, new farmers in
the area wishing to get into organic production would not receive
compensation for their monetary losses if their crops are treated with
the conventional pesticides that are prohibited in organic agriculture.

We were told it would take 4 years and now, almost a decade later the
eradication program is still there -- instead of declaring the boll
weevil "eradicated," the Boll Weevil Eradication Foundation is saying
that these zones are only "functionally" eradicated.

*Interestingly, while millions of pounds of insecticides are sprayed on
the fields all around us, our organic crops have survived the Boll
Weevil threat without any of those chemicals.*

3\. Very limited research and support for organic production practices.

One of the reasons organic cotton production is expanding overseas is
that the cotton is still hand-picked. We need to come up with products
that meet organic standards but work with the domestic, more
industrialized, methods of production. Organic Trade Association surveys
over the years have consistently found that organic farmers are calling
for weed and insect management products that can help control pests
while meeting the organic restrictions.

4\. Lack of support by existing national cotton groups.

Virtually every "upland" (vs. pima) cotton farmer in the U.S. must pay
Cotton Board assessments on the cotton they market. (Organic farmers are
exempted if their farm operations are 100% organic; however, most
farmers in TOCMC have mixed organic and conventional operations so have
continued to pay the assessment.) The Cotton Board collects these funds,
the majority of which are then passed on to Cotton Incorporated whose
role it is to provide research and promotional support for "upland"
cotton.

The production of organic cotton is creating a positive opportunity for
U.S. farmers and could have an even greater impact. However, several
times and as recently as just last Fall, those of us in the organic
cotton community, Organic Exchange and OTA have had to bring to the
USDA's attention the fact that Cotton Incorporated *is actively
denigrating* organic cotton production, even though its role is to
promote a particular variety of cotton - upland cotton -- *regardless of
the method of production.*

We hope Congress and USDA will ask Cotton Inc. to stay fast to its
mandate and provide research and promotional support for all upland
cotton production practices *equally*. This would include providing
research and promotional dollars to help organic cotton production
expand in the U.S.

I note that this need for support from the commodity boards is not only
for organic cotton. USDA needs to work with *all* the commodity boards
to ensure they provide equal research and promotional opportunities to
all growers regardless of production method.

Another positive component that would support organic production
practices would be to allow certified organic producers to automatically
qualify for Tier 3 under the Conservation Security Program.

Lastly, in addition to helping with the specific obstacles we outlined
above, we ask you to support OTA's requests to:

1 -- Foster the transition to organic agriculture and trade

2 -- Eliminate hurdles to organic agriculture and trade

3 -- Initiate and fund organic agriculture and economic research, and

4 -- Maintain and enhance current agency programs.

Mr. Chairman, I would like to thank you for your interest in supporting
and promoting organic agriculture in the United States. Organic farmers
are looking forward to having the tools and opportunities that will
allow us to take advantage of the growing organic marketplace. To do so
will allow us to provide a healthy, sustainable farming system that has
positive impacts not only for the environment, but for all of us that
are working and living in these rural communities.

I hope you and the others on the House Agriculture Committee will do
anything and everything you can do support and expand organic production
in the U.S. in the years to come. We will look forward to working with
you in any way possible to help you reach our mutual goals.

Thank you.

[^1]: <http://usda.mannlib.cornell.edu/usda/nass/AgriChemUsFC/2000s/2006/AgriChemUsFC-05-17-2006.pdf>