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China Continues to Lose Ground in U.S. Apparel Market

Total U.S. apparel imports fell by almost 2% to $6.2 billion in February compared to the same month last year, according to data released last week by the US Department of Commerce’s Office of Textiles and Apparel (OTEXA), bringing the year-to-date dollar volume to $13 billion, a 3.3% increase over the first two months of 2013. Total unit volume, measured on a square meter equivalent basis, increased 3.4%, driving up the average cost per SME down by 1.1%.

Vietnam continued to enjoy the biggest share gain of U.S. apparel imports so far this year, growing from 10.2% in 2013 to 11.6% in 2014, a 1.3 percentage point share gain. Apparel imports from Vietnam totaled $1.5 billion, growing 9.2 percent, while China’s apparel shipments to the U.S. dropped 3.7% to $4.7 billion. China has suffered the biggest share loss, dropping from 37.4% to 35.8%.  For the month of February, China’s apparel exports to the U.S. plunged by 12% compared to the same month last year, to $2 billion.

The cost per SME of apparel imported from Vietnam increased 4.4% for the year-to-date period, indication that the Southeast Asian country is fulfilling its goal of shipping pricier goods to the U.S. Key categories for Vietnam were: women’s cotton knit tops, women’s and men’s cotton pants, women’s manmade fiber knit tops and dresses, and cotton underwear.

Indonesia and Bangladesh continue to jockey for position as the third and fourth largest sources of apparel to the U.S. Bangladesh’s exports to the U.S. declined in February amid a significant minimum wage increase in the country and demands by U.S. apparel customers requiring factories there to invest in and improve safety conditions. However, they remain ahead of last year for January and February on both a dollar and unit basis. Apparel imports from Indonesia have decreased so far this year in both dollars and units. Indonesia’s share edged down from 7.2% to 6.6%.

India has gained some U.S. apparel import share so far this year. Key categories include men’s and women’s cotton and manmade fiber knit and woven tops.

Honduras managed to turn things around a bit in February, and exported 4.6% more apparel on a dollar basis than the same month last year. So far this year CAFTA-DR countries have gained .3 percentage points of market share — more than the South Asia, but less than the ASEAN region. Key categories from Honduras include men’s cotton and manmade fiber knit shirts.