China was one of only four of the top 10 apparel suppliers to the US to see market share increase in January, but across the board, apparel imports in 2023, sank on weakened consumer demand.

The year 2023 was a rocky one for the US apparel market with political turmoil including global wars, disruption to shipping and logistics, surging energy costs causing a spike in inflation and in turn increased living costs, all contributing to a weakened confidence in a consumer unwilling to prioritise apparel spend.

And the latest US apparel import data to come from the Office of Textiles and Apparel (OTEXA) is evidence of just that with apparel imports from all sources falling 22% year-on-year in 2023 to 24.3bn square metre equivalents (SME).

While China, the largest supplier of apparel to the US saw shipment volumes decline 18% during 2023, to 8.78m SME, it remained substantially ahead of the second largest apparel supplier to the US, Vietnam, whose shipment volumes sank 22% to 3.8bn SME, and Bangladesh, the third largest, whose shipment volumes fell 28% to 2.2bn SME.

All of the top 10 apparel suppliers to the US, Honduras saw the biggest decline in shipment volumes on an annual basis at 26% to 689m SME. But the Central American region is one of the smallest suppliers to the US and all of its sourcing countries witnessed a decline with El Salvador and Mexico reporting declines of 18.7% to 476m SME and 13% to 672m SME respectively.

The largest falls alongside Bangladesh came from Cambodia and Indonesia at 28% each to 982m SME and 993m SME followed by Pakistan at 24% to 684m SME.
India reported a 19% fall in shipment volumes to 121m SME during 2023.

Shipment value also decreased in 2023, with at least five of the top 10 suppliers to the US recording a fall of a quarter or more in value including Nicaragua, Honduras, Pakistan, Indonesia and China.

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Mexico saw the most modest decline in shipment values of 11% to $2.8bn during 2023 followed by El Salvador at 18% to $1.6bn.

Overall, apparel shipment value from all sources to the US fell 22% to $77.8bn.

US apparel imports: Key things to take forward in 2024

Commenting on the trends suggested by the latest dataset, Dr Sheng Lu, associate professor in the Department of Fashion and Apparel Studies at the University Delaware, warns: “Considering the predicted slower US economic growth in 2024, the US apparel import volume could stay stagnant for some time.”

With shipment volumes from China suffering a slightly more modest decline than its competitor sourcing nations, and in fact the Asian sourcing powerhouse posting an increase in shipment volumes in January, Lu says despite increased barriers coming from the Biden Administration looking to lower the US’ reliance on China, US apparel brands and retailers are still struggling to break away.

In the latest analysis carried out by Just Style, China was revealed to be the cheapest apparel source for the US on a per unit basis at the start of 2024 at $1.80, more than 70% lower than the next two cheapest countries to source apparel from.

Lu observes: “These contrasting and unusual trends provide narratives that could be used to justify a tougher US policy stance on China: one is that with a weak domestic economy, China is increasingly “dumping” cheap products to the world, threatening the survival of the US textile industry and garment suppliers in other countries. Second, the Section 301 tariffs didn’t result in inflation as previously expected. Thus, it seems unlikely that the current US trade barriers for products from China will be removed anytime soon. Instead, new trade restrictions could be imposed, further intensifying bilateral trade relations.”

The most important apparel suppliers to the US in 2024

Unsurprisingly, there is no shift at the top of the leaderboard with China continuing to dominate when it comes to apparel sourcing market share.

In fact, and consistent with the findings above, China’s share of the market soared in January 2024 by 7.4% to a total share of 39.7%.

China was one of only four markets of the top 10 suppliers to increase its share of the US apparel supply market.

Vietnam booked a 1.4% increase to 17.3% of US market share during the period.

While Bangladesh, which is the third largest apparel supplier to the US, saw its market share fall the most of the 10 by 3.5% to 8.8%.

India’s market share fell 0.7% to 4.8% in the period as did Indonesia’s by 1.7% to 3.5%.

While Pakistan saw a more modest decline in market share of 0.3% to 2.6%.

El Salvador, the smallest of the suppliers to the US of the 10, saw a 0.1% increase in market share to 1.4%. However this now puts it on par with Guatamela which also has a 1.4% share of the US apparel supply market, and both trail behind Sri Lanka which has a 1.6% share of the US apparel supply market.

Meanwhile, Honduras booked a 0.6% increase in market share to 2.1% but Cambodia and Mexico booked declines of 0.1% to 4% and 0.4% to 2.1% of the market respectively as of January 2024.

The news will no doubt frustrate the executives at the top, desperate to break away from China.

Earlier this month a group of US Senators announced they were floating a bill aimed at bolstering the US’ trade partnership with countries in the Western Hemisphere while lowering its reliance on China.

The Americas Act has been introduced by US Senators Michael Bennet (D-Colo.) and Bill Cassidy (R-La.), alongside US Representatives Maria Salazar (R-Fla.), Adriano Espaillat (D-N.Y.), and Mike Gallagher (R-Wis.) and coined “the only major strategic economic plan to counter China’s geopolitical and economic power in the Hemisphere and increase safety and stability to decrease regional migration.”

While in the same week, a bipartisan coalition announced its hopes to close the de minimis imports loophole that allows packages valued at $800 or less to reach US consumers without facing any taxes, fees or inspection. The coalition claimed the loophole is being exploited by China and other foreign entities to allow goods produced through forced labour as well as counterfeit and harmful consumer products into the US market.

Alliance for American Manufacturing (AAM) president Scott Paul claimed: “These Chinese companies have built billion-dollar businesses by exploiting de minimis, hooking American consumers on below-bargain-basement prices and supercharging a retail race to the bottom.”

Meanwhile, the American Apparel and Footwear Association has taken aim at the Section 301 China tariffs, deeming them an “ineffective” tool for tackling the US’ concerns with China’s policies and practices.

By Just Style