Bangladesh had previously exported RMG goods worth $3.7 billion to the destination in the same period of 2021
Bangladesh maintained its growth momentum in exporting apparel items to its biggest single destination, the United States, in the first seven months (January-July) of 2022, securing the position of the third largest exporter to the North American destination.
According to latest data from the Commerce Department’s Office of Textiles and Apparel (Otexa), Bangladeshi readymade garment (RMG) manufacturers shipped apparel items worth $5.71 billion, fetching a growth of 54.43%, in the said period of the ongoing calendar year.
Bangladesh had previously exported RMG goods worth $3.7 billion to the destination in the same period of 2021.
According to the Otexa data, in the same period, the overall US apparel imports reached $58.9 billion, noting a 39.06% year-on-year rise.
The data also showed that the single-month apparel export earnings from the US in July grew to $693.28 million, fetching a growth of 22.1% from $567.84 million in the same month last year.
However, the apparel export earnings of July from the US stood as the lowest since March 2022, maintaining a decline in monthly trends.
Otexa data also showed that Bangladesh earned $1.03 billion in March (Y-o-Y up 96.09%), $820.52 million in April (up 74.34%), $815 million in May (up 38.59%), and $906 million in June (up by 66.2%.)
Manufacturers said that due to the ongoing geopolitical crisis, energy crisis, and global inflation, the purchase orders have declined significantly by nearly 30% in the last few months.
Top brands like Walmart and GAP postponed their global orders due to overstock of their products, said manufacturers.
Apparel exports also experienced a growth in terms of volume by 38.69% to 1,963 million square metres in the first seven months of 2022, from 1,415 million square metres in the same period of 2021, said Otexa data.
Leading players
According to the data, China and Vietnam occupied the first and the second highest positions respectively in the US market as of July 2022.
US apparel imports from China in the January-July period of 2022 experienced a growth of 40.01% to $12.79 billion from $9.13 billion in the same period of 2021, proclaiming the first position with a market share of 23.71%.
Vietnam exported apparel items worth $10.91 billion in January-July of 2022, fetching a growth of 35.3% from $8.7 billion in the same period of the past year, claiming a market share of 17.55% which left them at the second position.
India secured the fourth position by exporting apparel items worth $3.69 billion, registering a growth of 59.39% from $2.31 billion in the first seven month of 2022 with a market share of 5.68%%.
RMG imports of the US from Indonesia in the January-June of 2022 increased by 59.69% to $3.41 billion while the imports from Cambodia grew by 55.9% to $2.58 billion in the same period, which made them the fifth and sixth, with a market share of 5.52% and 4.4% respectively.
Talking to Dhaka Tribune, Shahidullah Azim, vice-president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said that these orders were placed earlier.
“We got a lot of orders earlier due to trade wars between China and the US, Covid-19 lockdown and high production costs in Vietnam. But this year, we are affected by war and global inflation,” he said, adding that the work orders declined by 30% or more.
He also said that they should not only depend on the European or North American market, rather they need to find new markets.
East Asia, Middle East, India etc are big markets for apparel items and the impact of the geopolitical crisis is also lower there, Azim also said, adding that they have to enter these markets and growth must be maintained at any cost.
However, manufacturers fear that since the number of orders decreased, growth in September, October and November were also likely to be negative.
BGMEA Director Mohiuddin Rubel said that this growth may just be a short-term phenomenon as per the impression from the global brands and buyers.
Moreover, the industry has also been affected with a hike of 62% in yarn price, 500% in freight cost, and 60% in chemical cost.
“We want policy support from the government and we are also trying to overcome the vulnerabilities like product and market overconcentration, absence in the niche market, improvement of backward linkage industries,” he added.
