Bangladesh Closing in on China in Cotton Apparel Exports: USDA
Bangladesh is on track to pass China as the world’s largest cotton apparel exporter, new data shows.
According to the U.S. Department of Agriculture’s study, Cotton: World Markets and Trade, cotton consumption in the South Asian nation is up 800,000 bales, to 8.0 million, because of rising apparel exports, with demand predicted to go even higher.
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The USDA also said that almost all of the Bangladesh’s cotton yarn is sold within its borders. Apparel accounted for about 80 percent of Bangladesh’s total exports in fiscal year 2023 that ended July 31, which total $47.0 billion or double what it was a decade ago. Fiscal year 2023’s exports surpassed those of the year before, which observers say reflects a growing preference for Bangladeshi cotton products around the world.
The Bangladesh government foresees even greater growth. It predicts more than $50.0 billion in apparel exports in Fiscal 2024, according to the country’s Export Promotion Bureau. Spinning mills’ operating rates will rise as the supply chain hits reset, and depleted stocks of yarn, fabric and apparel are replenished after a year of low inventories.
Much of the current growth has been coming from the knit apparel sector, which tripled over the past decade. Local textile mills meet 85 percent of the demand for knit fabrics, but only 40 percent of that for woven fabric, most of which is imported from China, according to the Bangladesh Textile Mills Association. Major products helping drive recent growth trends are knitted cotton shirts and sweaters.
Record amounts of Bangladeshi cotton apparel were exported in 2022 to the U.S. and the European Union. The United States Fashion Industry Association’s (USFIA) yearly Fashion Industry Benchmarking Study noted factors indicating there will be even greater growth in the clothing export realm.
The study indicates that U.S. fashion companies have shifted sourcing away from China for a number of reasons. They include the Uyghur Forced Labor Prevention Act, Section 301 tariffs on Chinese exports and a move toward nearshoring to minimize the risk of supply chain disruptions due to logistical and political issues.
Fashion companies have said they will increase their sourcing from Bangladesh, India and Vietnam over the next two years to divert trade away from China. The same USFIA study also noted that Bangladesh is the most competitive apparel supplier price-wise. It scored higher than any other country on this metric.
