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Vietnam Will Be Biggest U.S. Apparel Market Share Gainer of 2013

Vietnam is on pace to enjoy the biggest gain of any top trading partner in U.S. apparel market share for 2013.

Total apparel imports have grown 3.9% on a dollar basis through November compared to the first eleven months of 2012. Total unit volume, measured on a square meter equivalent basis, has increased 5.1% in the year-to-date period, driving the average cost per SME lower by 1.1%.

Apparel imports from Vietnam have totaled almost $7.4 billion year-to-date, according to the most recent data published by the US Department of Commerce’s Office of Textiles and Apparel (OTEXA), and have grown by over 14%, five times faster than those from China so far this year on a dollar basis, though the total volume is just over a quarter the size of China’s.

Vietnam’s year-to-date share of U.S. imported apparel is 10.1%, a gain of .9 percentage points of market share so far this year compared to the same period in 2012. The cost per SME of apparel imported from Vietnam has edged up negligibly.

Vietnam has maintained its strong number two position thanks to increases in men’s and women’s cotton knit and women’s cotton woven tops, women’s cotton pants, men’s and women’s manmade fiber knit shirts and blouses, women’s woven manmade fiber blouses, and men’s and women’s manmade fiber pants. There were decreases in some categories of innerwear (bras and nightgowns) but increases in others (underwear and pajamas).

Total apparel imports from Bangladesh so far this year are $4.7 billion, up 11% from last year. The cost per SME of apparel imported from Bangladesh fell by .6% through November compared to the same period last year. Bangladesh’s share of U.S. apparel imports for the first ten months of 2013 is 6.3%, a gain of .4 percentage points over the same period in 2012.

Although Bangladesh has now virtually tied Indonesia as the third largest source of U.S. apparel in dollar terms, it is ahead of Indonesia in unit terms. Key product categories from Bangladesh include men’s woven cotton shirts, and men’s and women’s cotton and manmade fiber pants. However, recent legislation in Bangladesh that significantly increased the minimum wage there might alter considerably the country’s cost advantage vis-à-vis China and Vietnam, and could slow its growth.

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U.S. apparel imports from China totaled $27.7 billion through October. Year-to-date units (on a square meter equivalent basis) rose 4.9%, driving the cost per unit lower by 2.2%, or twice the overall average. China’s share of U.S. apparel imports is 37.4%, .5 percentage points behind the same period last year.

Product categories from China that have seen the biggest increases so far this year include men’s manmade fiber knit tops, women’s cotton woven shirts, hosiery, manmade fiber bras, and other intimate apparel. These increases were offset by declines in many other categories, including outerwear and cotton and manmade fiber skirts and dresses. Women’s and men’s cotton knit tops and pants remain among the largest categories, and have seen above-average growth on a dollar basis so far this year.

Sri Lanka has accelerated its apparel exports to the U.S. So far this year, it has shipped over $1.2 billion dollars worth of apparel, 10.3% ahead of last year, and the third fastest growth rate after Vietnam’s and Bangladesh’s, putting it just behind Pakistan as one of the top U.S. trading partners in dollar volume. One reason for this is a decline in the value of the Sri Lankan rupee compared to the U.S. dollar. Key product categories in which Sri Lankan clothing makers have developed specific capabilities include women’s knit and woven cotton tops, women’s bras and men’s and women’s cotton pants.

Mexico, Honduras, Cambodia and Indonesia have suffered significant share losses in U.S. apparel as well. CAFTA has lost share to South Asia and ASEAN. CBI imports, which are up by double digits on both a dollar and unit basis but only slightly on a share basis, are almost exclusively cotton tee shirts and underwear from Haiti.