CUTS UNDER NEW CHINA PACT DROP ITS TOTAL U.S. QUOTA 2.6%
Byline: Jim Ostroff
WASHINGTON — The quota cuts this year on 17 categories of imports from China in the new textile-apparel trade pact range from 50 percent on woven wool fabrics to 1.25 percent on cotton sheeting.
The agreement, hammered out over five days in Beijing before talks concluded Feb. 2, provides an overall 2.6 percent decrease in China’s quotas in 1997 compared with what they would have been had the old pact been extended. In the remaining three years of the pact, however, quotas increase, averaging 1 percent hikes annually, said Rita Hayes, the chief U.S. textile negotiator in an interview last week.
Hayes said the cuts were made in response to China’s illegal circumvention of U.S. import quotas in recent years, as well as China’s overshipping. She declined to provide details on specific quota until the new pact is published in the Federal Register, now slated for sometime this week.
The access to the Chinese market for U.S. apparel, newly provided in the pact, has been enthusiastically greeted by U.S. manufacturers and retailers, as reported. However, the quota cuts are sure to bring howls from retailers and importers, as have any attempts in the past to limit shipments from China, a prime source of inexpensive merchandise. Industry representatives declined to comment Friday, though, noting they wanted to wait until details of the pact were published in the Federal Register.
Of 17 product categories that received significant reductions under the new agreement, WWD has learned from sources that the two biggest hits were taken by woven wool fabrics, category 410, whose 1996 base level of 1.96 million square meters equivalent was cut 50 percent to a 1997 base level of 979,362 SME, and carded and combed cotton yarn, category 300/301, whose 1996 base level of 3.7 million SME was cut 40 percent to a 1997 base level of 2.2 million SME.
How great the impact will actually be, of course, depends on shipping patterns. For example, there should be little impact felt on woven wool fabrics, which in 1996 hit only a 10.82 percent fill rate with shipments of 226,738 SME.
Two other double-digit percentage cuts in China’s quotas were cotton terry towels, category 363, down 30 percent to 20.98 million pieces, and cotton print cloth, category 315, down 18.8 percent to 129.83 million SME.
Three other product categories were given identical quota cuts of just over 9.5 percent: cotton underwear, category 352, which declines to 1.6 million dozen; men’s and boys’ wool pants, category 447, down to 69,916 dozen, and men’s and boys’ wool suit jackets, category 433, down to 20,643 dozen.
Identical 4.52 percent quota cuts were made in woolen shirts and blouses, category 440, down to 37,341 dozen, and men’s and boys’ wool suits, category 443, down to 127,702 units. Chinese import quotas for men’s and boys’ man-made fiber non-knit shirts, category 640, were cut 4.53 percent to 1.37 million dozen.
Other Chinese quota reductions included: men’s and boys non-knit cotton shirts, category 340, down 4.29 percent to 781,557 dozen; cotton bedsheets and quilts, category 362, down 3.1 percent to 6.97 million units; men’s and boys’ and women’s and girls’ cotton trousers, category 347/348, down 2.81 percent to 2.34 million dozen; men’s and boys’ and women’s and girls’ cotton knit shirts, category 338/339, down 2.52 percent to 2.31 million dozen, and cotton sheeting, category 313, down 1.25 percent to 40.7 million SME.
Offsetting these cuts are increases in many other quotas, although all are in the low-single-digit range. For example, quotas for cotton nightwear, category 351, increase 6.1 percent to 531,492 dozen, while quotas for manmade fiber underwear, category 652, increase nearly 5.1 percent to 2.64 million dozen.