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A New Picture of Denim Sourcing is Coming Into Focus

Asian apparel sourcing powerhouses Vietnam, Bangladesh, Cambodia, Pakistan and India are solidifying their positions as denim jeans manufacturers, while African countries continue to show momentum.

The denim apparel market itself, 98 percent of which is jeans, also continues to show strength. Year-to-date U.S. imports grew 7.37 percent in the first nine months to a value of $2.82 billion, according to the U.S. Commerce Department’s Office of Textiles & Apparel (OTEXA).

U.S. imports of denim apparel from Bangladesh increased 14.2 percent in the period, to $419.21 million, while shipments from Vietnam jumped 41.95 percent, to $205.43 million. Jeans imports from Pakistan grew 9.75 percent, to $178.98 million in the period; Cambodia’s were up 30.85 percent, to $88.34 million; and India’s rose 53.68 percent; to $27.48 million.

Sourcing experts have noted the Asian countries generally have been growing their market share at the expense of China, which is still the top supplier of jeans to the United States. China’s shipments of denim apparel grew just 1.36 percent in value, to $683.08 million, in the nine months compared to the same period a year earlier.

China’s overall apparel imports have mirrored the slowdown of its exports to the U.S. in the midst of a trade war with the Trump administration—which has threatened to impose a 25 percent tariff on all imports from China in January— as well as increased costs and a greater focus on domestic consumption from the Chinese industry. This has caused companies to diversify their sourcing away from China to hedge their bets against increased costs.

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Andy Zhong, marketing director of China’s Prosperity Textile, said the company’s core denim fabric hasn’t specifically been on the tariff list, although it could be included in the next round. Prosperity has proactively shifted its sourcing, in many cases shipping its Chinese-made fabrics to Bangladesh, Vietnam, Cambodia and other countries for garment making and then exported to the U.S.

On the other hand, Omer Ahmed, managing director of Pakistan’s Artistic Milliners, said the trade war between the U.S. and China has led to longer-term trends of customers seeking alternative mill options in Asia.

“The cost of producing textile goods in a sustainable way in China has been increasing year-on-year for the last decade or so,” Ahmed said. “American textile importers have been wary of this for some time and have been actively moving production to other countries in Asia—India, Bangladesh and Vietnam being three of the main beneficiaries. Now, Pakistan seems to be the latest sourcing option trending with small- and large-scale brands alike.”

A similar trend can be seen in the Western Hemisphere, where Mexico’s stance as top supplier in the region is being challenged by its Central and South American neighbors. Denim apparel imports from Mexico inched up 1.07 percent in the year through September ,to $595.39 million. Experts feel Mexico could see a bounce if the recently negotiated U.S.-Mexico-Canada Agreement (USMCA) is ratified, easing uncertainty that the White House would pull the U.S. out of the North American Free Trade Agreement altogether and eliminate Mexico’s trade preference status.

At the same time, Colombia’s jeans shipments increased 38.98 percent, to a value of $47.06 million; Nicaragua’s rose 0.97 percent, to $74.97 million; and Guatemala’s were up 28.46 percent. to $24.82 million. Denim apparel imports from the Western Hemisphere as a whole now represent 26.84 percent of U.S. market share, up 0.58 percent for the year ended Sept. 30, according to OTEXA.

Africa’s position as an apparel supplier to the U.S., including denim, has shown strong momentum this year. Egypt’s shipments for the nine-month period increased 3.64 percent, to a value of $115.3 million, while imports of the category from Lesotho rose 12.81 percent, to $59.15 million; Madagascar’s were up 13.61 percent, to $17.71 million; Kenya’s grew 71.11 percent, to $13.29 million; and Tanzania’s gained 28.56 percent, to $8.7 million. For the year ended Sept. 30, Sub-Saharan Africa held a 4.09 percent of U.S. denim apparel market share, increasing 12.23 percent.