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Made in China Jeans Becoming More Scarce as Sourcing Slips

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China’s decline as a source of denim apparel manufacturing expanded in November, as companies look elsewhere to save costs and reduce risks.

For the third straight month since 15 percent tariffs on denim jeans and associated products imported into the U.S. from China took effect, shipments dropped significantly. At the same time, a diverse array of suppliers, from Vietnam, Pakistan and Cambodia to Egypt, Jordan and Nicaragua, have consistently posted gains in the year through November, according to the Commerce Department’s Office of Textiles & Apparel (OTEXA).

U.S. jeans imports from China fell 24.35 percent to a value of $659.51 million for the year to date through November, according to OTEXA. This was an expansion of the erosion of sourcing from China for the category, after a 21.97 percent year-to-date decline was posted in October.

China’s U.S. import market share tumbled 22.51 percent for the year through November to 19.33 percent. China had lost its top supplier spot to Mexico earlier this year, as the U.S.-China trade war cut into its U.S.-destined production.

Morris Goldfarb, chairman and CEO of G-III, told analysts last month that the company is accelerating “the efficient and effective diversification of our manufacturing base.”

“We estimate our China-based production will be approximately 50 percent by the end of this fiscal year from over 80 percent four years ago,” Goldfarb said. “We are also reallocating some of our experienced personnel in China to other parts of the world.”

Mexico’s year-to-date shipments dipped 0.62 percent to $753.08 million. The country’s market share slipped 0.37 percent for the 12-month period to 21.69 percent.

No. 3 supplier Bangladesh saw its imports to the U.S. rise 1.5 percent in the period to $544.3 million. The country’s market share was up the same amount to 15.32 percent.

Fourth-place supplier Vietnam saw its shipments climb 22.61 percent to $339.91 million. Amid concerns of the country’s production reaching capacity, its market share grew 22.73 percent to 9.58 percent.

The Top 10 supplier countries posting significant gains incl Nicaragua, with shipments increasing 19.84 percent to $120.95 million; Egypt, with imports up 15.37 percent to $161.85 million; and Cambodia, with an increase of 7.7 percent to $115.17 million.

In addition to China and Mexico, Indonesia also lost ground, with shipments declining 15.59 to $65.30 million in the period. Overall imports from the world were down 3.05 percent year-to-date to $3.48 billion.

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