US apparel imports from CAFTA-DR countries fell in the third quarter of last year, reflecting rising uncertainties ahead of US quotas' removal. Poor results in cotton knit shirt categories 337 and 338 may indicate some serious threat for Central American countries while US trouser imports from the Dominican Republic dramatically fell in the last two years. Man-made fiber apparel imports from the region more resisted.

US apparel imports from CAFTA-DR countries significantly fell in the third quarter of 2007.

Shipments declined 9% in value terms at US$2.1 billion, by contrast with the stability experienced a year earlier.

The Dominican Republic and four countries in Central America implemented in 2006 a duty-free agreement with the United States aimed at limiting competition from Asia. Signatory Central American countries include El Salvador, Guatemala, Honduras and Nicaragua.

Guatemala down

The fall observed in the third quarter last year was mainly due to a sharp decrease in US apparel imports from the Dominican Republic which lost 41% in volume terms and 35% in US$ terms.

Imports from Honduras rose 2.18% in value terms, by contrast, while imports from Nicaragua were up 5.43%.

Shipments from El Salvador and Guatemala decreased by 3% and 15% in value terms.

Although US quotas on Chinese products are still effective until the end of 2008, CAFTA-DR countries looked less protected than a year ago by such quantitative limits.

In key categories 338 and 339 (cotton knit shirts for men and women), imports respectively fell 7.45% and 11.28% in value terms.

Imports of cotton underwear in 352 also declined more than 12%, reflecting a new threat coming from most ordered products in the past.

More Stable

US imports of man-made fiber apparel from CADTA-DR countries were more stable, only losing a mere 0.29% compared with a 12% drop for cotton apparel imports.

From two years ago, shipments are still rising in 338 and 339 while dramatically falling in 347 and 348 (cotton trousers), mainly reflecting the decline in demand for Dominican products in these categories.

Production of cotton trousers in the Dominican Republic urgently need a boost in the arm after US demand was affected by slow implementation of CAFTA-DR agreement.

EmergingTextiles.com