U.S. apparel imports started 2022 with an unexpected swell to meet ongoing strong consumer demand, with all Top 10 suppliers posting increases compared to January 2021, according to the Commerce Department’s Office of Textiles & Apparel (OTEXA).
“It is a bit surprising to see the surge continuing during the month of January,” Julia Hughes, president of the United States Fashion Industry Association, said. “We suspect some of the surge is due to the supply chain crisis, with companies shipping earlier than in past years and looking for better prices when they ship during traditionally slower months.”
There was also likely a push to get goods out of factories and ports ahead of the Feb. 1 Lunar New Year and associated plant closures and worker shortages.
No. 3 production spot Bangladesh led the way with a 42.1 percent year-over-year increase to 282 million square meter equivalents (SME), while Indonesia saw a 39.49 percent hike to 108 million SME. Shipments from India were up 30.73 percent in the period to 124 million SME, as imports from China, the top supplier of apparel to American brands and retailers, rose 25.26 percent in January compared to a year earlier to 996 million SME.
Vietnam, the month’s No. 2 supplier of U.S. apparel, continued its more modest gains with a 9.04 percent rise to 380 million SME. Among the other Asian top suppliers, imports from Cambodia gained 15.56 percent to 105 million SME and shipments from Pakistan increased 23.13 percent to 84 million SME, OTEXA data showed.
Hughes said sourcing trends “are incredibly stable from what we saw during 2021.” While U.S. apparel imports continue to be dominated by Asian suppliers, “we continue to see very strong growth from Western Hemisphere Free Trade Agreement suppliers, CAFTA [countries] and USMCA partner Mexico,” she added.
Rounding out the Top 10 were Western Hemisphere countries Honduras, Mexico and El Salvador. Of the group, Mexico posted the largest increase, gaining 20.68 percent year over year to 65 million SME.
Shipments from Honduras and El Salvador, which as part of the Central American Free Trade Agreement (CAFTA) are eligible for duty-free status, as is Mexico under the U.S.-Mexico-Canada Agreement, rose 4.1 percent to 49 million SME and 8.03 percent to 65 million SME, respectively.
They contributed to an overall increase of 14.36 percent from CAFTA countries to 188 million SME, aided by gains from other participant nations–Nicaragua, Guatemala and the Dominican Republic. Other Western Hemisphere countries with gains and benefitting from a nearshoring movement were Haiti, Peru and Canada.
Patricia Medina, owner of apparel producer Aztex Trading Co., told attendees at a panel discussion at the Sourcing at Magic show that Mexico’s verticality with raw materials and factories has become a strong selling point.
“When you’re talking about cotton, there are a lot of vertical companies” that provide full-package solutions, from fabric to finished garment, across the country, Medina said.
While Mexico lacks the “capacity of China,” the country’s “added value” stems from the ease and speed of inventory replenishment, she added.
In 2021, U.S. yarn exports to provide the raw materials for the CAFTA countries’ apparel factories increased 47.87 percent to a value of $1.66 billion, while fabric exports to the region rose 9.46 percent to $803.25 million.
Also on Tuesday, the U.S. Census Bureau and Bureau of Economic Analysis announced the goods and services trade deficit was $89.7 billion in January, up $7.7 billion from $82 billion in December. The January trade deficit reflected an increase in the goods deficit of $7.1 billion to $108.9 billion and a decrease in the services surplus of $600 million to $19.2 billion.