WASHINGTON — As apparel imports from Bangladesh fell again in October, having declined nearly every month this year, other countries such as India and Vietnam appeared to pick up some of the South Asian nation’s lost business, the Commerce Department’s trade report showed on Friday.
Bangladesh’s garment industry, which is undergoing massive inspections and reforms in the wake of two factory tragedies that claimed the lives of more than 1,240 workers, has continued to lose business this year. In the latest data, apparel imports from Bangladesh to the U.S. fell 15.7 percent to 128 million square-meter equivalents, compared to October 2013. For the year to date, apparel imports have declined 4.6 percent to 1.2 billion SME.
The October drop marked the largest decline in apparel imports to the U.S. this year, a reflection of the uncertainty surrounding the safety of workers in its garment industry over the past several months.
“Those orders were generally placed quite awhile ago, and there was concern about what was happening in Bangladesh at the time as part of the efforts by the [Alliance for Bangladesh Worker Safety and the Bangladesh Accord on Fire and Building Safety],” said Julia Hughes, president of the U.S. Fashion Industry Association. “That may have meant that companies shifted production out, but I don’t know that that will be a permanent shift.”
Hughes said major retailers and brands committed to either the alliance or the accord are not shifting business out of Bangladesh. But smaller companies could be shifting some production out, she added.
Stephen Lamar, executive vice president at the American Apparel & Footwear Association, said the decline in Bangladesh’s apparel imports could be from “short-lived” disruptions, stemming from the uncertainty and fallout from the tragedies several months ago but also from the inspections and remediation at factories.
Pointing to a major multi-stakeholder summit on safety — hosted by the Bangladesh Garment Manufacturers and Exporters Association in conjunction with the AAFA’s international product safety, worker safety and supply-chain compliance conference in Dhaka next week — Lamar said there is an “incredible commitment from a number of brands, not only U.S. but also European and other global brands, to maintain a presence in Bangladesh and to oversee improvement of building factory safety and inspections.”
India appears to be one of the biggest beneficiaries of the shift in production, as apparel imports from the country rose 19.3 percent to 84 million SME in October, compared with a year ago.
“There definitely seems to be some linkage between Bangladesh decreasing and India increasing,” Hughes said. “You are seeing a big shift there, with double-digit declines in Bangladesh and double-digit increases from India. The fact that it is the same region makes sense from a sourcing perspective. If you are in South Asia, you might be shifting some of that production around.”
She said synthetic apparel imports from India to the U.S. rose 32 percent in October compared with a year ago, while cotton apparel imports rose 13 percent. Vietnam saw a 17.6 percent rise to 268 million SME in apparel shipments to the U.S. year-to-year.
China, the top U.S. apparel supplier, posted a 9 percent increase in apparel imports to 1.1 billion SME, and its share of the U.S. apparel import market was 45 percent for the month, Hughes added.