By  on July 14, 2008

WASHINGTON — With demand chilled by the slow economy, U.S. textile and apparel imports in May dropped for the third consecutive month.

The combined volume of textile and apparel imports to the U.S. in May fell 6 percent after declining 0.6 percent in April and 11.4 percent in March, the Commerce Department said Friday. A total of 4.3 billion square meter equivalents of apparel and textiles entered the U.S. in May.

Textile and apparel imports from China declined 3.7 percent to 1.78 billion SME. Chinese apparel imports to the U.S. dropped more significantly than textiles, down 7.3 percent in May from the same period a year ago to 544 million SME, continuing a downward trend triggered by higher prices on Chinese goods and the slowdown in the U.S. economy.

"This is the precarious economic time we have warned about for so long," said Charles McMillion, president and chief economist of MBG Information Services.

Other countries reporting substantial declines in May were Canada, Mexico, Pakistan and South Korea. Canada shipped 112 million SME of apparel and textiles, down 36.3 percent from a year earlier. Mexico's apparel and textile imports fell 14.7 percent to 236 million SME, Pakistan's slid 9 percent to 274 million SME and South Korea's declined 11.5 percent to 147 million SME.

"My suspicion is that part of why the import numbers are down reflects a bit of the nervousness at retail for what consumer demand is going to look like this year," said Julia Hughes, senior vice president of international trade with the U.S. Association of Importers of Textiles & Apparel.

"Apparel usually gets hit early and hard....Particularly when basics like gas costs are going up, you usually see people cutting back on things like apparel," said Cass Johnson, president of the National Council of Textile Organizations.

The only significant gain in apparel and textile imports was from Vietnam, which spiked 24.2 percent to 138 million SME. Most of that growth was driven by Vietnamese apparel imports, which rose 26.6 percent in May from the previous year to 118 million SME.

Bangladesh, Indonesia and Honduras were the other top apparel and textile importers who reported higher shipments to the U.S. Shipments from Bangladesh gained 5.1 percent to 141 million SME, Honduras increased imports by 2 percent to 110 million SME and Indonesian shipments were up 2.1 percent to 135 million SME.

The top five apparel suppliers in May, ranked by volume, were: China, Vietnam, Bangladesh, Honduras and Mexico. China also led the list of textile suppliers, followed by Pakistan, India, Mexico and South Korea.

The total U.S. trade deficit unexpectedly narrowed in May, to $59.8 billion from $60.5 billion the previous month, driven partly by a precipitous drop in the volume of oil imports.

"The trade deficit had been expected to widen in May on higher oil prices, but instead it narrowed slightly," said Nigel Gault, chief U.S. economist at Global Insight, adding that oil import volume was "exceptionally low in May."

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