Bangladesh’s clothing products exported to the United States may be hit by the US ban on Xinjiang, China. The Bangladesh Clothing Buyers Association (BGBA) has previously issued a directive requiring its members to be cautious when purchasing raw materials from the Xinjiang region.
On the other hand, American buyers hope to increase their imports of clothing from Bangladesh. The American Fashion Industry Association (USFIA) highlighted these issues in a recent survey of 30 fashion companies in the United States.
According to a report from the US Department of Agriculture, cotton consumption in Bangladesh is expected to increase by 800000 bales to 8 million bales in 2023/24, due to strong clothing exports. Almost all cotton yarn in the country is digested in the domestic market for the production of fabrics and clothing. At present, Bangladesh is close to replacing China as the world’s largest exporter of cotton clothing, and future export demand will further strengthen, driving the growth of cotton consumption in the country.
Clothing exports are crucial for Bangladesh’s economic growth, ensuring the stability of the currency exchange rate, especially in achieving US dollar foreign exchange income through exports. The Bangladesh Association of Clothing Manufacturers and Exporters stated that in the fiscal year 2023 (July 2022 June 2023), clothing accounted for over 80% of Bangladesh’s exports, reaching approximately $47 billion, more than double the historical high of the previous year and indicating an increasing acceptance of cotton products from Bangladesh by global importing countries.
The export of knitted clothing from Bangladesh is crucial for the country’s clothing exports, as the export volume of knitted clothing has almost doubled in the past decade. According to the Bangladesh Textile Mills Association, domestic textile mills are able to meet 85% of the demand for knitted fabrics and approximately 40% of the demand for woven fabrics, with the majority of woven fabrics imported from China. Cotton knitted shirts and sweaters are the main driving force for export growth.
Bangladesh’s clothing exports to the United States and the European Union continue to grow, with cotton clothing exports particularly prominent in 2022. The annual report of the American Fashion Industry Association shows that American fashion companies have attempted to reduce their purchases to China and shift orders to markets including Bangladesh, due to the Xinjiang cotton ban, US clothing import tariffs on China, and nearby purchases to avoid logistics and political risks. In this situation, Bangladesh, India, and Vietnam will become the three most important clothing procurement sources for American retailers in the next two years, excluding China. Meanwhile, Bangladesh is also the country with the most competitive procurement costs among all countries. The goal of the Bangladesh Export Promotion Agency is to achieve clothing exports exceeding $50 billion in the fiscal year 2024, slightly higher than the level of the previous fiscal year. With the digestion of textile supply chain inventory, the operating rate of Bangladesh yarn mills is expected to increase in 2023/24.
According to the 2023 Fashion Industry Benchmarking Study conducted by the American Fashion Industry Association (USFIA), Bangladesh remains the most competitive country among global clothing manufacturing countries in terms of product prices, while Vietnam’s price competitiveness has declined this year.
In addition, recent data released by the World Trade Organization (WTO) shows that China maintained the top position as a global clothing exporter with a market share of 31.7% last year. Last year, China’s clothing exports reached 182 billion US dollars.
Bangladesh maintained its second position among clothing exporting countries last year. The country’s share in clothing trade has increased from 6.4% in 2021 to 7.9% in 2022.
The World Trade Organization stated in its “2023 Review of World Trade Statistics” that Bangladesh exported $45 billion worth of clothing products in 2022. Vietnam ranks third with a market share of 6.1%. In 2022, Vietnam’s product shipments reached 35 billion US dollars.
Post time: Aug-28-2023