US imports of Chinese textiles decline
Drop in first two months comes a year after the end of quotas
The value of United States imports of Chinese textiles and garments fell slightly in the first two months of this year, the first drop for the period in eight years, according to Department of Commerce data.
The decline contrasted with the huge jump in January and February last year after global textile quotas were scrapped.
In the first two months this year, US imports declined 0.63 per cent to US$3.34 billion, according to the commerce department. In the same period last year, the value soared 125 per cent to US$3.36 billion.
'[Last year] was a crazy year anyway. I won't be surprised if US imports of Chinese textiles remain flat or slightly decline for the rest of this year,' said Willy Lin Sun-mo, a vice-chairman of the Hong Kong Textile Council.
For garments, US imports from China fell 9.44 per cent to US$2.08 billion in the first two months.
Many garment items under US quotas saw huge drops. For example, imports of man-made fibre underwear from China plunged 68.1 per cent in the first two months.
In November last year, to stem the influx of Chinese textiles, the US signed an agreement with China which placed quotas on many garment items until the end of 2008.
'I'm sure the official statistics will show negative growth in US imports of Chinese textiles for the rest of this year,' said Henry Tan, the chief executive of Luen Thai Holdings, the largest garment maker listed in Hong Kong.
However, a textile executive said actual shipments of Chinese textiles to the US were increasing but not reflected in official data, because many garments were illegally transshipped with documents showing false countries of origin.
Pointing to drops of more than 60 per cent in imports of some Chinese garments under quota, the executive said: 'If the actual shipments were anywhere close to these official figures, lots of factories would be shutting down and firing many workers. Instead, there's a labour shortage in China.'
Earlier this month, China's Ministry of Commerce auctioned this year's remaining quotas for textile exports to the US and European Union. Few Hong Kong firms bought quotas at the auction, which meant exports of China-made textiles to the US and EU by Hong Kong firms would be weak for the rest of this year, Mr Lin said.
The low take-up of quotas was because prices were bid too high, he said. 'If quota prices are too high, it's cheaper to buy from other countries like India.'
Mr Tan said Luen Thai bought few quotas at the auction. 'Luen Thai caters to the better end of the US market. If we can't afford the quota prices, people selling to the lower-end mass market probably can't afford them.'
