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Vietnam is U.S. Apparel Share Winner in January

Total U.S. apparel imports grew 3.3% to $6.8 billion in January, according to data released last week by the Department of Commerce’s Office of Textiles and Apparel (OTEXA). Total unit volume, measured on a square meter equivalent basis, increased 3.4%, driving the average cost per SME down by a negligible .2%.

Vietnam enjoyed the biggest share gain of U.S. apparel imports, growing from 10.2% of the dollar total in January 2013 to 11.5% in 2014. Indonesia suffered the biggest share loss, dropping from 7.5% to 6.7%. China’s share edged up from 38.1% to 38.3% on a dollar basis.

Apparel imports from Vietnam totaled $785 million, growing 16.3% year-on-year, almost five times faster than total imports and more than four times faster than imports from China, whose apparel shipments to the U.S. increased by 3.9% on a dollar basis. Vietnam’s total volume is still less than a third the size of China’s, however.

The cost per SME of apparel imported from Vietnam increased 4.6%, indicating 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’s position as the third largest source of apparel has been challenged by Bangladesh, whose dollar and unit shipments to the U.S. grew faster, and whose unit shipments were greater. Bangladesh’s recent significant minimum wage increase might begin to alter considerably the country’s cost advantage vis-à-vis China and Vietnam, and could slow its growth.

U.S. apparel imports from China totaled $2.6 billion in January, up only 3.9% over January 2013. Units (on a square meter equivalent basis) rose 5.5%, driving the cost per unit lower by 1.5%, a steeper decline than the overall average.

Key product categories from China in January include women’s cotton knit tops, women’s and men’s cotton pants, women’s manmade fiber knit tops and dresses, manmade fiber hosiery and  manmade fiber bras.

Mexico and Honduras have suffered significant share losses in U.S. apparel imports as well, resulting in a much smaller growth in CAFTA imports than in South Asian and ASEAN. CBI imports, almost exclusively cotton knit tops from Haiti, fell on both a dollar and unit basis in the month.