U.S. apparel imports from China continued a comeback in October, rising for the second consecutive month after an extended slump in the midst of the U.S.-China trade war, which has seen tariffs imposed on both sides.
Apparel imports to the U.S. from China increased 19.3 percent to 1.33 billion square meter equivalents (SME) in October compared to a year earlier and were up 13.9 percent in value terms to $3.13 billion, according to the Commerce Department’s Office of Textiles & Apparel (OTEXA).
Trade experts had expected China to rise out of a prolonged decline as companies turned back to their most reliable supplier for key fourth quarter merchandise. And because certain Chinese imports were already facing 10 percent tariffs—not to mention the threat of an additional 25 percent tariff that could include apparel—trade experts felt a good window existed to pump out holiday merchandise from the country. Particularly considering the previously slated Jan. 1 increase has been put off for another 90 days amid an apparent truce on trade between Trump and China.
“President Trump’s trade war with China and the threat of even higher tariffs in 2019 have created a mini-boom in imports and businesses have rushed to bring goods into the country ahead of the tariffs,” said Ben Hackett, founder of consultancy Hackett Associates. “We are clearly in a politically motivated trade environment.”
With the U.S. economy doing well and forecasts for strong holiday sales on the horizon, U.S. imports of apparel from around the world rose 14.5 percent to 2.85 billion SME. The National Retail Federation has forecast holiday sales excluding automobiles, restaurants and gasoline stations–will increase between 4.3 percent and 4.8 percent over last year.
Virtually all suppliers saw strong gains in shipments in the month. Among the major Asian countries, imports from Vietnam jumped 16.9 percent to $1.33 billion, and Cambodia increased by the same percentage, with goods bound for the U.S. reaching $246.27 million in value. Bangladesh’s shipments rose 14.9 percent to $478.2 million and Pakistan’s were up 25.3 percent to $138.68 million. There were also notable gains from the Philippines, with imports rising 11.1 percent to $91.78 million, and South Korea, which saw its shipments increase 20.2 percent to $23.76 million.
Among Western Hemisphere countries, imports from Central American Free Trade Agreement (CAFTA) participants Guatemala, El Salvador, Nicaragua and Honduras, all saw gains in the month from a year earlier. Haiti’s shipments were up 27.7 percent to $101.82 million and imports from Peru rose 15.3 percent to $65.41 million.
African countries continue to make their mark as sourcing options, too. Imports from Ethiopia jumped 149 percent in year over year comparisons, reaching $13.09 million, Madagascar’s shipments increased 55.9 percent to $18.75 million and Kenya’s rose 8.9 percent to $36.43 million.
The U.S. goods and services deficit was $55.5 billion in October, up $900 million from $54.6 billion in September, according to the U.S. Bureau of Economic Analysis. The deficit with China increased $700 million to $38.2 billion in October. Exports decreased $2.6 billion to $7.6 billion and imports fell $1.9 billion to $45.7 billion.