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Sourcing Shifts Take Hold in Denim Amid Trade Conflicts

The political upheaval in global trade brought on in great part by U.S. policy and attempts to upturn international commerce, seems to clearly be having an effect on where countries source that most American of wardrobe staples—denim jeans.

Analysis of U.S. denim import data from the Commerce Department’s Office of Textiles & Apparel (OTEXA) in the first five months of the year shows some obvious gainers and losers in market share, and indicators of the direction sourcing executives are taking.

Declines in shipments from Mexico come amid attempts by the Trump administration to renegotiate the North American Free Trade Agreement, while a market share decline from China occurred in the midst of two-way tariff wars from the world’s two largest economies.

At the same time, gains and inroads are apparent from countries the U.S. has not taken to task, such as Bangladesh and Colombia—even if they have their own set of problems—as companies take to risk-aversion strategies to protect future orders and maintain price stability in the face of actual and potential tariffs. Longer term shifts also continued, including increases from countries in Sub-Saharan Africa and Central American nations.

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Looking at the top two denim jeans suppliers, Mexico and China, the market has definitively made some decisions to lower its threshold in the two countries amid the political derisiveness. For the men’s and boys’ category, imports from Mexico for the year to date through May fell 3.75% to $249.1 million worth of goods, as shipments of women’s and girl’s jeans from the country declined 10.58% to $34.25 million, OTEXA reported. Mexico maintained its spot as the No. 1 supplier of men’s and boy’s denim jeans at 36.55% market share, but that represented an 8.94% share erosion year over year for the 12 months ended May 31.

U.S. imports of women’s denim jeans from China increased 4.09% to $217.97 million for the year to May, while its shipments of men’s and boy’s jeans inched up 0.55% to $68.21 million. China kept its top spot in the women’s and girls’ category with a 37.99% market share, but that was brought down 0.4% for the year, according to OTEXA.

Among major Asian suppliers, Bangladesh has made a strong showing this year, as have Vietnam, Pakistan and Cambodia. Denim imports from Bangladesh rose 19.9% in women’s and girls’ to $71.9 million and increased 21.15% to $94.54 million in men’s and boys’. Vietnam’s shipments advanced 39.57% to $54.51 in women’s and girl’s, while jumping 41.75% to $21.09 million in men’s and boys’.

Imports from Pakistan grew 29.09% in women’s and girls’ to $52.13 million in the period and rose 8.38% to $33.09 million in men’s and boys’. Cambodia’s shipments were up 45.84% to $32.72 million in women’s and girls’, and rose 8.38% to $33.09 in men’s and boys’.

Several countries that are part of the Central American Free Trade Agreement did well so far this year, combining for a 13.75% increase in women’s and girls’ to $14.18 million, although shipments of men’s and boy’s fell 16.61% to $29.3 million. Guatemala’s women’s and girl’s denim exports to the U.S. were up 26.84% to $6.5 million; Nicaragua’s rose 5 percent to $7.66 million in the same category, but fell 12.78% to $25.49 million in men’s and boys, and Colombia’s jumped 62.73% to $8.45 million in women’s and girls’, and ballooned 66.97% to $16.35 million in men’s and boys’.

On a smaller but significant scale, denim jeans imports from Sub-Saharan Africa countries that are part of the African Growth & Opportunity Act rose 58 percent in women’s and girls’ to $10.31 million, although men’s and boys’ shipments dipped 6.75% to $39.68 million. Notably, imports from Lesotho increased 41.26% to $4.24 million in women’s and girls’, but fell 12.97% to $21.52 million in men’s and boys’.

Elsewhere, Turkey’s jeans exports to the U.S. increased 27.95% to $12.25 million in women’s and girls’, but declined 16.04% to $6.41 million in men’s and boys’. Egypt also saw some gains, with increases of 11.1% in women’s and girls’ to $24.72 million and 6.97% in men’s and boys’ to $33.81 million.