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Back in Step: Footwear Imports From Vietnam Gain, China Stalls

U.S. footwear imports increased in May, stepping ahead 25.6 percent year to date to 1.13 billion pairs, just above the average shipment level the sector had achieved in the first four months of the year, according to the latest data from the Commerce Department’s Office of Textile & Apparel (OTEXA).

Imports for top producer China continued to slow, rising a year-to-date 28.6 percent through May to 661.83 million pairs. This compared to a 30.5 percent year to date gain in April and a 34.5 percent increase in the first quarter, signaling how brands and retailers have diversified production.

However, the most recent Caixin China General Manufacturing Purchasing Managers Index (PMI) compiled by S&P Global said the reduction in Covid-19 case numbers and subsequent easing of containment measures across China led to a renewed improvement in manufacturing business conditions in June.

The manufacturing PMI increased to 51.7 from 48.1 in June, the first improvement in the health of the sector for four months. Though modest, the rate of increase was the strongest seen since May 2021.

“After three months of contraction, the gauge for output returned to expansionary territory and jumped to its highest point since November 2020,” Dr. Wang Zhe, senior economist at Caixin Insight Group, said.

Footwear shipments processed at U.S. ports from No. 2 supplier Vietnam, which had returned to the positive in April after months of year-over-year declined due to backlogs from Covid-induced factory closures, rose 10 percent year to date through May to 255.13 million pairs. This compared to a 5.6 percent increase the prior month a decline of 4.5 percent in the first quarter, according to OTEXA.

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“The Vietnamese manufacturing sector ends the first half of 2022 in good health, with firms feeling that they’ve seen the back of the pandemic and are able to generate new business at a solid rate,” Andrew Harker, economics director at S&P Global Market Intelligence, said. “The main positive from the latest PMI survey was around employment, which increased at the fastest pace in three-and-a-half years. This shows that the difficulties firms were facing getting hold of staff around the turn of the year have eased, and means that manufacturers are able to respond quickly to customer requests and keep on top of workloads.”

Combined imports from China and Vietnam in the five-month period equaled an 81 percent U.S. market share, sliding from the four-month total of 82.1 percent and 83.2 percent in the first quarter, according to OTEXA data.

The rest of the top five suppliers–Indonesia, Cambodia and India–posted notable increases in the period, as did third-tier suppliers Italy, Mexico, Brazil, Bangladesh and Germany.