WASHINGTON — Wholesale prices for domestically produced women’s and girls’ apparel rose 0.3 percent in April, giving manufacturers some more flexibility, according to the U.S. Department of Labor Producer Price Index released Thursday.
Prices for U.S.-made apparel and textiles have been falling for years because of import pressures. The labor department has overhauled the PPI to fully capture growing segments such as services, and does not provide year-over-year cost comparisons because many of the textile and apparel price categories were reclassified.
“A combination of rising import prices…and a healthier-end market is allowing more pricing flexibility in the battered apparel sector, but I wouldn’t characterize it as pricing power,” said John Mothersole, senior economist at Global Insight, a market research company. “We noted for some time import prices from the European Union, Canada and Latin America have been rising, which is a direct function of the depreciation of the dollar. Now we are seeing an uptick in prices from Asia, which gives domestic producers more wiggle room.”
Producer prices for all apparel edged up 0.1 percent in April compared with March, although they also have been in a long-term deflationary pattern. For all finished goods, producer prices increased 0.7 percent last month, primarily because of rising energy and food costs.
Mothersole said he is not concerned about inflation because the core PPI rate, which excludes food and energy, has risen by 0.2 percent, which he found “reassuring.”
“There are exaggerated inflation fears out there, but we don’t see as much of an acceleration in the core goods prices,” said Mothersole, noting that those prices have been stable.
Among categories in which the labor department’s new index does provide year-over-year comparisons, wholesale prices for gray fabrics rose 0.5 percent last month and increased 0.8 percent compared with April 2003. Finished fabric prices inched up 0.2 percent in April and gained 0.5 percent for the year, while prices for yarns rose 0.2 percent last month and surged 3.9 percent over April 2003.
In the women’s and girls’ category, which includes apparel cut and sewn in the U.S., prices for skirts, tailored jackets and vests, jeans and slacks, swimwear, sweaters and underwear remained flat in April. Wholesale costs for dresses rose 1.7 percent, while prices for bras increased 0.1 percent.
In another new category based on apparel made in knitting mills, prices fell 0.1 percent. Within that sector, prices for sweaters and knit shirts were unchanged last month, while prices for pantyhose and tights fell 1.1 percent, and rose 0.1 percent for sheer hosiery.