The latest data from the US Office of Textile and Apparel (OTEXA) reveals US apparel import volumes fell in January, in both value and volume terms, however Dr Sheng Lu tells Just Style there are signs of gradual recovery.

US apparel imports, according to the latest data from OTEXA for the month of November, fell by more than 3.4% in value from a year ago, and 17.5% in quantity.

The data corresponds with figures from the National Retail Federation (NRF), which reveal February saw one of the lowest levels of import cargo volume since the beginning of the pandemic. Volumes, however, are expected to begin slowly climbing again in March, according to the Global Port Tracker.

For the month of January, OTEXA data shows US apparel imports were down 17.4% to 2,157 MM2 in volume terms. China remains the top apparel supplier to the US but the East Asian country saw shipment volumes drop by 30.1% during January 2023 compared with a year earlier.

Vietnam (343 MM2), Bangladesh (266 MM2), India (118 MM2) and Indonesia (113 MM2) completed the top five, respectively, in volume terms during January.

Summary of OTEXA’s apparel imports for January

·        Of the top ten, Indonesia was the only country to experience growth in the volume of US apparel imports in January 2023 at 4.8%.

·        In value terms, China saw its share of US apparel imports drop by 5.6% in January to 19.8%. Imports were down 24.6% to US$1.44bn.

·        Bangladesh saw its share increase by 2% in January. In value terms, US apparel imports amounted to $868m.

·        Vietnam (0.5%), India (0.8%), Indonesia (0.5%), Mexico (0.1%), Nicaragua (0.7%), and Sri Lanka (0.2%), also saw their share of US apparel imports increase.

·        The countries that saw declines in US imports were Cambodia (-0.4%), Honduras (-0.4%) Pakistan (0.0%) and El Salvador (-0.1%).

·        China retains the highest volume share of US imports in volume terms, at 32.3%, but this is down on its share of 38.1% last year.

January 2023 OTEXA trade data suggests several trends to watch

Associate professor in the Department of Fashion and Apparel Studies at the University Delaware, Dr Sheng Lu reveals to Just Style exclusively that despite a decline in the volume of US apparel imports in January 2023 from a year ago, there are indications of a gradual recovery.

He says an example of this can be seen in the seasonally adjusted data for US apparel imports, which indicates a 1.9% decrease in quantity from the previous month but a 0.8% increase in value.

He adds: “As another encouraging sign, the consumer confidence index (CCI) stood at 71.2 in January 2023, much higher than 65.5 in December 2022. Improved consumer confidence is expected to drive an increase in clothing demand.”

Lu also points out US apparel imports from China sharply dropped by -24.6% in value and -30.1% in quantity, far worse than the world average. While the Lunar New Year holiday may have contributed to the decline, he says the results also reflect US fashion companies’ growing concerns about the deteriorating US-China relations.

The data also shows that US fashion companies continued to move sourcing orders from China to other Asian countries. As Lu explains: “Countries with relatively large-scale production capacity, such as Bangladesh, Vietnam, and Indonesia, remained the top choice. Meanwhile, in response to US fashion companies’ sourcing diversification strategies, Chinese garment factories also increasingly moved their operations to nearby Asian countries.”

Additionally, he says in January 2023, US apparel imports from members of the Central America Free Trade Agreement (CAFTA-DR) decreased by 21.4% in quantity and 5.8% in value, worse than the average.

“The result again reminded us that the fundamental bottleneck preventing more US apparel sourcing from the region has yet to be solved.”

Meanwhile, Hackett Associates founder Ben Hackett said of the latest NRF import figures: “Retailers are maintaining reduced inventories in anticipation of rebuilding with new seasonal stock once they have a clearer take on expected levels of consumer spending. While import volumes remain low, the tight labour market and strong wages are helping consumers absorb the impact of inflation and continue to spend.”