The Future of Sudanese Cotton: Between the Governance of the Brazilian Model and Bangladesh’s Value-Addition Success

Dr Al-Haitham Al-Kindi Yousif
Since the establishment of the Gezira Scheme in 1925, cotton has been Sudan’s principal cash crop, serving as the structural backbone of the national economy after independence. During the early decades of the post-independence state, cotton accounted for approximately 70 per cent of foreign exchange earnings and financed more than half of the national budget. It was the primary factor underpinning exchange-rate stability and the main source of funding for public services such as health and education, making it a cornerstone of economic security.
Over the past decade, however, production has declined significantly, with cotton exports rarely exceeding US$100 million annually, except for the exceptional performance recorded during the 2021–2022 season, when export revenues reached US$384 million. These figures remain modest when compared with the scale of resources that could potentially be harnessed in this sector.
Legislative Transformations and the Changing Structure of Production
The legal framework governing cotton production has undergone several transformations that fundamentally reshaped production relations.
During the colonial era and the years that followed, the Gezira Scheme Administration managed the entire agricultural cycle, including financing and marketing. This arrangement remained in place until the enactment of the Gezira Scheme Act of 2005, which embraced the principles of economic liberalisation. The Act dismantled the centralised management structure, abolished coordinated agricultural planning, and transferred the burden of financing and irrigation to individual farmers.
As a result, the Scheme was transformed from an integrated production unit into a collection of privately managed holdings. At the same time, farmers were granted complete freedom to choose which crops to cultivate. Unfortunately, this transition coincided with a collapse in global cotton prices, prompting many farmers to abandon cotton cultivation in favour of alternative crops, leading to a substantial reduction in cotton acreage.
Cotton Exports: From Monopoly to Liberalisation
The export sector also experienced a dramatic shift, passing through two contrasting phases.
The Monopoly Era (Sudan Cotton Company)
During this period, the state monopolised cotton marketing, providing Sudan with considerable bargaining power in international markets and enabling the establishment of trusted brands associated with Sudanese cotton. However, bureaucratic inefficiencies hindered the development of the cotton sector and discouraged investment in downstream industries linked to cotton production.
Full Liberalisation and Market Deregulation
The removal of the state monopoly opened the market to intermediaries and exporters who often lacked the necessary expertise and qualifications. This led to speculative practices that negatively affected prices and facilitated the leakage of export proceeds outside the formal banking system.
Consequently, economic liberalisation proved detrimental to the wider economy rather than catalysing the production growth and national prosperity that policymakers had originally envisioned.
Global Challenges Facing Cotton
Globally, cotton has faced the challenge of competition from synthetic fibres—particularly polyester derived from petrochemicals—since the 1970s. Polyester’s lower production costs and ease of manufacturing have exerted persistent downward pressure on global cotton prices, which have historically fluctuated between 70 and 90 US cents per pound, with occasional exceptional spikes.
For this reason, cotton prices tend to be positively correlated with oil prices. As oil prices rise, the cost of producing polyester increases, thereby enhancing the competitiveness of natural cotton. Given current market conditions, where prices are approaching 90 cents per pound, Sudan should take advantage of this favourable window of opportunity.
Current Challenges Facing Sudanese Cotton
Sudanese cotton currently faces a complex set of challenges and threats, the most significant of which include:
Deteriorating Infrastructure
Major irrigated schemes such as Gezira and Rahad suffer from severe deterioration of irrigation canals and chronic neglect.
Input and Financing Constraints
Dependence on imported fertilisers, whose prices fluctuate significantly, combined with inconsistent access to agricultural finance, has substantially increased production costs. Farmers also face recurring input shortages at critical stages of the agricultural calendar, adversely affecting productivity, as agriculture is fundamentally dependent on timely operations.
Declining Quality
The mixing of cotton varieties and the uncontrolled shift towards genetically modified short- and medium-staple cotton have undermined Sudan’s historic reputation for producing abundant supplies of high-quality cotton.
Lessons from Brazil
The Brazilian experience in coffee production offers a valuable model. Brazil faced challenges remarkably similar to those confronting Sudanese cotton, ranging from price volatility and climate-related pressures to declining quality. Rather than accepting decline, Brazil undertook comprehensive structural reforms through:
Mechanisation and Scientific Research
Brazil developed hybrid varieties resistant to drought and pests while embracing modern agricultural technologies. These measures reduced production costs and significantly increased productivity.
Export Governance
The country established a unified governing body responsible for monitoring quality standards, regulating export volumes to maintain balanced supply levels, and directing production towards higher-value crops rather than lower-value commercial outputs. This approach ensured more favourable prices for producers.
Through these policies, Brazil increased the value of its cotton exports to between US$12 billion and US$15 billion annually during the past five years.
Sudan could adapt elements of the Brazilian model by transforming irrigated schemes such as Gezira, Rahad, Suki and New Halfa into fully mechanised agricultural enterprises and establishing a Supreme Cotton Council that links agricultural research institutions directly with export markets.
Strategic Recommendations
Several strategic measures could help narrow the trade deficit, curb inflation and transform cotton into an instrument for stabilising the national currency.
Reforming the 2005 Act
The law should be revised to restore the state’s role as regulator and strategic planner while preserving farmers’ ownership rights. National irrigation engineering services should also be rehabilitated and strengthened.
Mandatory Repatriation of Export Proceeds Through a National Exchange
A cotton exchange should be established in Khartoum or Port Sudan to prevent unregulated exports and require exporters to repatriate foreign currency earnings through the banking system. Export proceeds would be sold to the Central Bank at a fair exchange rate, thereby contributing directly to improving the trade balance.
Transitioning Towards Value Addition Through Domestic Manufacturing
The gradual export of raw cotton should be phased out and replaced by support for local spinning, weaving and textile industries capable of exporting yarn, fabrics and finished garments. This could increase the value generated per tonne of cotton by more than 300 per cent.
Bangladesh provides a compelling example. Despite producing virtually no cotton itself, the country has built a globally competitive textile and garment industry. Between 2021 and 2025, Bangladesh exported textile and clothing products worth more than US$40 billion annually on average, and has set a target to increase this figure to US$100 billion by 2030.
Vietnam presents a similar success story, with export figures that closely mirror those achieved by Bangladesh.
Establishing an Agricultural Input Financing Facility
A dedicated financing facility should be created to fund fertilisers, pesticides and jute sacks. By securing inputs through direct international procurement contracts at competitive prices, production costs could be reduced while ensuring the timely availability of essential supplies.
The Ministry of Finance, the Central Bank, the Agricultural Bank and a consortium of commercial banks could jointly finance such a facility.
Conclusion
Restoring the prominence of Sudanese cotton has become an urgent economic necessity and one of the safest pathways out of the country’s current economic crisis.
Drawing inspiration from successful international experiences such as those of Brazil and Bangladesh—and embracing bold reforms centred on export governance, domestic processing and value addition—could transform cotton from a raw commodity vulnerable to fluctuating global prices into a genuine engine of economic growth.
Such a transformation would strengthen the national currency, expand export earnings and restore Sudan to its natural place on the map of global trade.

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