WASHINGTON — China and Vietnam, the top two apparel suppliers to the U.S., continued to increase their share of the U.S. apparel-import market in August, as three other top-10 suppliers — Bangladesh, Cambodia and Indonesia — continued to lose share amid ongoing labor issues, the Commerce Department’s trade report showed Friday.
Apparel imports from Vietnam rose 15.5 percent to 250 million square meter equivalents in August compared with August 2013, while apparel imports from China, the number-one supplier to the U.S., rose 3.7 percent to 1.2 billion SME.
Apparel imports from Cambodia, impacted by months of strikes over wages, fell 9.6 percent to 84 million SME year over year, while apparel imports from Bangladesh, confronted with the challenges of improving safety in its garment sector following two tragedies that claimed the lives of more than 1,240 workers, fell 3.6 percent to 155 million SME. Apparel imports from Indonesia fell 4.4 percent to 99.8 million SME.
“There seems to be a [shift] back to China from Bangladesh and Cambodia, even though prices are higher in China,” said Julia Hughes, president of the U.S. Fashion Industry Association. “There is a comfort level in China and it makes sense that there might be a default back there for some of these orders.”
Hughes stressed that many of the top-10 suppliers (seven in all) were in “negative” territory in apparel imports in August compared with a year ago, noting that it is hard to tell how much of the impact on apparel imports is from social unrest in countries. She said declines from countries such as Bangladesh and Cambodia could also be part of a broader trend of weakness among second-tier suppliers and a lot more strength in shipments for the holiday season from China and Vietnam.
Apparel imports from the world to the U.S. rose 3.3 percent to 2.5 billion SME, while textile imports from the world to the U.S. rose 0.9 percent to 2.9 billion SME.
Nate Herman, vice president of international trade at the American Apparel & Footwear Association, said Vietnam is also pulling orders away from China to some extent.
“I think people see Vietnam as the best alternative to China [because of rising labor and transportation costs] and also as the best alternative to many other countries [such as Bangladesh and Cambodia] they were considering as alternatives to China,” Herman said.
Herman said he expects apparel imports from Bangladesh to stabilize in light of the overall progress that has been made by industry initiatives aimed at improving fire and building safety in the garment industry there, particularly the Alliance for Bangladesh Worker Safety, he said.
“We hope the import numbers will [bounce] back because of all of the work brands and retailers are putting into Bangladesh,” Herman said.
In Cambodia, where labor unions are pressing for the minimum wage to be raised from the current $100 monthly rate to $177 per month, “people are still nervous” about expanding their sourcing in the country, Herman said. The Cambodian government has still not resolved the minimum-wage debate but is said to be holding meetings on the issue.
“I have not heard of anyone other than Levi Strauss pulling out [some sourcing], but I don’t think people are increasing orders there either. Everyone is in a wait-and-see mode,” Herman said.
The overall trade deficit narrowed in August to $40.1 billion from $40.3 billion in July.