The numbers are in and they show it wasn’t a good year for China or Mexico, for that matter, when it came to supplying the U.S. with apparel.
The trade war between the world’s two biggest economies, which drove many brands to shift their sourcing out of China to avoid steep tariffs, resulted in apparel shipments from China to the U.S. falling 9.1 percent in 2019 for a value of $24.88 billion from $27.37 billion in 2018, according to the Commerce Department’s Office of Textiles & Apparel (OTEXA).
This brought China’s import market share of apparel down to 29.68 percent in value terms for the year compared to 33 percent in 2018. In volume, China’s apparel import market share fell to 39.93 percent in 2019 from 41.9 percent the previous year.
For different reasons, mostly the cost of manufacturing compared to other Western Hemisphere countries, apparel imports from Mexico were down 6.49 percent to $3.13 billion for the year, according to OTEXA. An example was Gildan Activewear, which said in November that it was closing its textile and sewing operations in Mexico and relocating the equipment to its operations in Central America and the Caribbean Basin.
Glenn Chamandy, president and CEO of Gildan, said Mexican production represented about 8 percent to 9 percent of capacity, which will now be moved to Central America and Honduras and “be absorbed pretty quickly.”
Imports from Honduras–part of the Central American Free Trade Agreement (CAFTA)–rose 9.82 percent to $2.82 billion for the year, while overall CAFTA shipments increased 3.68 percent to $8.65 billion. This included an 11.09 percent increase for Nicaragua for a value of $1.01 billion.
Among China’s Asian neighbors, imports from No. 2 supplier Vietnam gained 11.01 percent in 2019 to reach a value of $13.56 billion. This gave Vietnam a 16.18 percent market share, rising from 14.75 percent in 2018.
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Imports from Bangladesh increased 9.83 percent for the year to reach $5.93 billion, while India’s shipments rose 6.8 percent to $4.06 billion. Imports from Cambodia jumped 11.29 percent for the year to $2.68 billion and Pakistan’s shipments increased 7.11 percent to $1.46 billion.
Reflecting the strategies behind the winners and losers in 2019, Yelena Mogelefsky, vice president of sourcing and production at Komar Brands, said at last month’s Texworld USA show that her company’s diversification plan has evolved from being “narrow and deep,” with loyalty to factories that had performed well over the years, to “knowing right now that China’s not necessarily the place to be,” and putting production in places like Vietnam.
The only other Top 10 apparel suppliers that notched declines in imports were Indonesia, down 1.68 percent to $4.4 billion, and El Salvador, off 2.45 percent to $1.86 billion. This came as overall apparel imports fell 0.3 percent in volume to 27,740.7 square meter equivalents in 2019. In value, apparel imports from the world increased 1.16 percent to $83.86 billion.
Among secondary suppliers showing strength in 2019 were Middle Eastern countries Jordan and Egypt, and African countries Kenya, Madagascar and Ethiopia, along with Haiti, Turkey and Myanmar.