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The Australasian Journal ofNatural Resources Law and Policy [Vol. 9, No.2, 2004J
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COTTON, HEALTH AND ENVIRONMENT: A CASE STUDY OF SELF-REGULATION
NEIL GUNNINGHAM" ABSTRACT: The Australian cotton industry confronts a range of serious environmental challenges, many of which relate to the use and misuse of agricultural chemicals, This article asks which policy instruments are likely to be most effective and efficient in addressing those challenges. Is government regulation a credible option or would industry self-regulation achieve better results? Is there a role for environmental management systems or is some other option, or combination of options, likely to achieve better economic and environmental outcomes? More broadly, given the substantial threats to the cotton industry's legitimacy (and indirectly to its economic viability) resulting from its tarnished environmental image, how might the industry best preserve its 'social licence' and rebuild trust and credibility with key stakeholders? The answers to these questions will resonate with more than the cotton industry alone. The industry provides a classic example of the health and environmental challenges which confront high input, intensively irrigated agriculture and other industries that have also aroused a high degree of public concern concerning their environmental impact. The ways the cotton industry has reacted to the pressures it faced and sought to protect both its 'social licence' and its economic viability through voluntary environmental management arrangements (VEMAs) contain important lessons for many other industry sectors that will, sooner or later, confront similar health, environmental and economic challenges.
Neil Gunningham is Professor in the School of Resources, Environment and Society at the Australian National University:
[email protected]. The author gratefully acknowledges the comments of Patricia Healy and Allan Williams, the research assistance of Kerrie Mclfonald, the comments of two anonymous referees and the contribution of the various intervieweeswho must remain anonymous.
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I. INTRODUCTION
In a little over three decades, Australian cotton farming has developed into an AUD 1.5 billion dollar' industry and the third largest exporter of cotton in the world.' But that growth has come at a substantial cost to the environment and to workers' health. Of greatest concern have been the risks associated with agricultural chemicals. In the late 1990s the use of endosulfan in particular posed a serious threat not only to the environment, but also to the cattle industry, whose export markets were threatened by high pesticide residues found in export beef produced on mixed farms or on properties adjoining cotton producers. Cotton related pesticides have been connected with fish kills and other damage to aquatic life, raised occupational health concerns amongst agricultural workers, and been a source of community concern when residues were found in domestic water tanks and elsewhere.' Against this backdrop, we must consider which policy instruments are likely to be most effective and efficient in addressing the occupational health and environmental challenges the industry faces. Is government regulation a credible option or would industry self-regulation achieve better results? Is there a role for environmental management systems or is some other option, or combination of options, likely to achieve better economic and environmental outcomes? More broadly, given the substantial threats to the cotton industry's legitimacy (and indirectly to its economic viability) resulting from its tarnished environmental image, how might the industry best preserve its 'social licence' (that is, the
Under normal growing conditions. Recent figures have been drought affected - value of production fell from a high of AUD 1.8 bn to AUD 1.5 bn (2001/02) through AUD 1.2bn (2002/03) to AUD 982 (2003/04): see Department of Agriculture, Fisheries and Forestry (Cwth), 'Cotton: The Cotton Industry' (25 May 2004) avail at 22 December 2004; and ABARE, 'Australian Commodities: Cotton Outlook' (10 December 2004) at 22 December 2004. (Note: billion is US 10' or thousand millions.) Cotton Research and Development Corporation (eRDe), Cotton Research and Development Corporation Annual Report 2003-2004 (2004) avail as a pdf file from at 22 December 2004, 12.
TheNamoi catchment community, for example, identified the prevention of surface and groundwater contamination by pesticides and other agricultural chemicals (with endosulfan specifically mentioned) as a 'major issue' at a community discussion meeting (Gunnedah, 23 March 1998) during the determination of catchment objectives: EPA NSW, 'Water Quality and River Flow Interim Environmental Objectives' Community Comment, Major Issues (23 February 2000) avail at 30 December 2004.
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expectations of local communities, the wider society, and various constituent groups)' and rebuild trust and credibility with key stakeholders? The answers to these questions will resonate more broadly than simply with the cotton industry alone. The industry provides a classic example of the health and environmental challenges which confront high input, intensively irrigated agriculture and other industries that have also aroused a high degree of public concern concerning their environmental impact. The ways it has reacted to the pressures it faced and sought to protect both its 'social licence' and its economic viability through· the adoption of voluntary environmental management arrangements (VEMAs) contain important lessons for many other industry sectors that will, sooner or later, confront similar health, environmental and economic challenges. As we will see, the cotton industry responded to these threats by producing what it terms an 'industry-wide Environmental Management System (EMS)" and by developing a variety of industry level selfregulatory initiatives through its Best Management Practice (BMP) program.' In effect, the industry association sought to develop an industry-wide VEMA, with heavy reliance on codes of practice, BMPs and (in a broad sense) EMS. This article draws on interviews with a diversity of stakeholders," the evolving literature on the cotton industry (including the 2003 external audit of the industry'), and the wider international experience of self-regulatory initiatives. Its focus is the occupational health and environmental impact of agricultural chemicals, and the lessons that can be leamed from the cotton industry experience in terms of designing better policy mixes, and integrating voluntary environmental management arrangements with government and third Social licence is here defined as the demands and expectations vis-a-vis a business
enterprise that emerge from neighborhoods, environmental groups, community members, and other elements of the civil society in which the industry operates. See A Williams, R Thomas and J Williams, 'Environmental Management Systems and Agricuiture: Theory, Practice and Reality - Experiences from the Cotton Industry' (Paper presented at the EMS in Australian Agriculture Conference, Ballina, NSW, 6-8 November 200I). 6
For a comprehensive description and analysis. see 'Evaluation of the Australian Cotton Industry BMP Program' prepared for Cotton Australia and the Cotton Research and Development Corporation by Macarthur Agribusiness, Brisbane, February 2004 (funded by the National Heritage Trust) avail 30 December 2004, (hereafter Macarthur Agribusiness (2004). A total of 22 open-ended interviews were conducted with cotton industry association
representatives, cotton growers, environmental groups, government agencies, farmers' federations and other significant stakeholders in New South Wales during the course of 2002-03. , Cotton Research and Development Corporation (CRDC), Second Australian Cotton Industry Environmental Audit (2003) (Australian Government - Cotton Research and Development Corporation) avail as a pdf file at at 28 August 2003.
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party oversight. It does not examine, nor take any position on, the cotton industry's use of scarce water resources, or the broader issue of whether, given its levels of resource consumption and chemical use, the cotton industry can even be made sustainable in Australian conditions.
A. COTION, HEALTH AND ENVIRONMENT The modem Australian cotton industry was established with the introduction of irrigated cotton production during the 1960s.' Today, 70 per cent of cotton production is in central and north-western NSW, with remaining cotton production in central and southern Queensland. Overall, Australian cotton production covers an area of over 400,000 hectares, with average production of just over 3 million bales each year." Many cotton farms are owned and independently operated by family farmers, who also practice other forms of agriculture, including sheep and cattle grazing.II However, there are also an increasing number oflarge corporate farms. The latter have large amounts of capital available, and are progressive in their utilisation oftechnology and advanced farming practices. Cotton production requires intensive management including irrigation, weed control, and insect control." Insect management is particularly important, as cotton is susceptible to a wide range of insect pests throughout its 180-200 day growing period, and poor management may cause significant economic damage. Substantial quantities of pesticides including herbicides, insecticides and defoliants are used to manage the impacts of insects on cotton crops (conventional cotton is sprayed 6-12 times). Defoliation is also necessary as a precursor to harvesting, and conditioners are also applied before harvest. Seed
Gibb Environmental Sciencesand Arbour International, An Environmental Audit afthe 10
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Australian Cotton Industry: Executive Summary (1991), 2. Cotton Australia, Fact Sheets: Facts and Figures (2003) avail al23 August 2003. Production for the last two seasons has been substantially below average due to prevailing drought conditions. The 2004 harvest of l.5m bales was less than half that of the average of the 5 years preceding the drought: CRDC, Annual Report 2003-2004, above n 2, 16. Improved surface water and allocations conditions is expected to result in a substantial improvement for 2004/05: ABARE, 'Australian Commodities, Cotton outlook' (10 December 2004) avail 22 December 2004. The number of family farmers is usually about \,500 but drought and farm consolidation has reduced that number to around 800: Cotton Australia, Fact Sheets: Environment Where is cotton grown? and Facts and Figures (both nd, est 2003) avail at30 December 2004. Gibb, above n 9.
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that is to be reused for planting is treated with fungicide and systemic insecticide." According to one environmental group, [C]onventionally grown cotton uses more insecticides than any other single crop ... Eachyear cotton producers around the world use ... more than IO'M. of the world's pesticides and nearly 25% of the world's insecticides." Within Australia, the cotton industry's agricultural chemical use has been identified as causing off-site environmental damage to terrestrial and aquatic ecosystems, as well as to surrounding communities, and agricultural properties. Of particular concern is the use of the organochlorine insecticide endosulfan, which is used for the control of heliothis (heliocoverpa) and may also be used to control rough bollworms, mirids, thrips, aphids and tipworm." Endosulfan has a high acute or immediate toxicity to humans and can reach concentrations in waterways that are lethal to various forms of aquatic life." The use of endosulfan in cotton production came into particularly sharp focus in 1999 when endosulfan residues were found in Australian cattle." The residues not only lowered their sale price, but threatened international beef exports: most dramatically when a shipment of Australian beef was rejected by South Korea because it contained unacceptable residue levels." Interviewees suggested that property prices of cattle farms close to cotton areas were also perceived to be threatened.
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Ibid. Pesticide Action Network North America (PANNA), Problems with Conventional Cotton Production (2003) Pesticide Action Network North America at 28 April 2003. J W H Barrett, S M Peterson and G E Batley, 'Impact of Pesticides on the riverine environment with specific reference to cotton growing' (Report to the Cotton Research and Development Corporation and the Land and Water Resources Research and Development Corporation, Narrabri, 1991). National Registration Authority for Agricultural and Veterinary Chemicals, Existing Chemicals Review Program The NRA Review of Endosulfan; vol I (1998) (NRA Endosulfan Review), vii. Avail at APVMA website as a pdf file: at 30 December 2004. For an example of an Australian fish kill incident that prompted monitoring in mid-1990s, see State Pollution Commission, 'Priority Issues Involved in the Diffuse Pollution of Waterways Especially by Agricultural Chemicals' (1985), 5 cited in Mariann LloydSmith (2002) 'Polluter Pays, Myths and Legends' avail
