U.S. exports of textiles and apparel increased 3 percent to $592 million in 2014, with fabrics representing the largest export product group, accounting for 33 percent of shipments in the sector, and Mexico representing the largest market at $4.63 billion, according to a new report from the U.S. International Trade Commission.

Fibers and yarns were the second-largest product group in the sector, accounting for 26 percent of exports. Honduras was the largest market for fibers and yarns, fueled by investments from U.S. yarn and knit apparel companies, the U.S. ITC said Tuesday. Apparel was the third-largest export product group at 20.5 percent of shipments, with Canada the largest market for U.S. apparel products.

The category of “re-exports,” or goods that are imported into the country and then shipped out to other nations, accounted for about 19 percent of total exports. The majority of the re-exports were concentrated within the apparel product grouping, accounting for 44 percent of U.S. exports of apparel in 2014, up from 32 percent in 2010.

Apparel companies are increasingly importing apparel into distribution centers in U.S. foreign-trade zones for inventory control and distribution, then re-exporting the apparel to Canadian and Mexican markets, under the provisions of the North American Free Trade Agreement, with plans to export to other Western Hemisphere markets in the future. Using FTZs allows these companies to cut costs in a number of ways, including importing products into the U.S. duty-free.

The overall rise in exports of textiles and apparel largely reflected increased shipments to Mexico of broadwoven fabrics. The 9 percent increase in U.S. exports of fibers and yarns worth $133 million to Honduras also contributed to the overall increase in sector exports. A large part of these exports were cotton yarn.

U.S. imports of textiles and apparel, with apparel representing about 75 percent by value, was largely driven by manmade-fiber apparel. This reflected strong demand for activewear, as consumers stepped up their preferences for the functional and performance properties that manmade fibers offer, the ITC noted.

China was the largest U.S. supplier of textiles and apparel in 2014, rising by 2 percent to $47.2 billion. However, U.S. imports from Vietnam, the second-largest supplier of these products, grew 14 percent to $9.82 billion. Despite China’s continued dominance, the data and industry sources suggest that U.S. retailers and brands are continuing a long-term trend of diversifying their import sources to countries such as Vietnam and India, as China’s textile and apparel production costs have increased, the ITC stated. China’s share of textile and apparel imports was flat at 39 percent in 2014.

The trade activity occurred as U.S. gross domestic product grew at an annual rate of 2.4 percent in 2014, higher than the 2.2 percent increase it experienced in 2013. Total industrial production in the U.S. rose 5 percent during 2014, compared to 3 percent during 2013.