Tag: SSA

Patterns of U.S. Apparel Imports (updated June 2026)

First, U.S. apparel imports continued to shrink in April 2026, reflecting consumers’ hesitation to spend on clothing amid worsening inflation and ongoing economic uncertainty. Specifically, U.S. apparel imports declined by 12.0% in value and 13.8% in April 2026 compared to the previous year, marking the fourth consecutive month of negative growth. Even after adjusting for seasonal factors, U.S. apparel imports in April 2026 were still 3.2% lower in value and 5.1% lower in quantity than in March 2026. As U.S. inflation rose to 4.2% in May 2026, U.S. apparel imports may not reverse the downward trend anytime soon. [see detailed monthly U.S. apparel import data here]

Second, although Asia still dominates, the U.S. apparel sourcing base is becoming increasingly diverse. By value, about 70.2% of U.S. apparel imports came from Asian countries in April 2026, down from 72.0% a year earlier. Notably, Asia’s declining market share was NOT captured by Western Hemisphere countries, whose share remained at 15.7% in April 2026 (including 13.7% for CAFTA-DR and USMCA members), even slightly lower than the 15.8% recorded in April 2025. Instead, U.S. apparel imports from countries outside Asia and the Western Hemisphere reached a new high of 14.1% in April 2026, up from 12.3% in April 2025 and well above the 7.4% recorded in 2015. This shift reflects U.S. fashion companies’ efforts in recent years to explore emerging sourcing destinations in regions such as Africa, the Middle East, and the EU to mitigate growing sourcing risks and other concerns.

Third, at the country level, U.S. fashion companies have increased sourcing from several key Asian apparel-supplying countries beyond China, as well as from a few emerging sourcing destinations in other regions. Specifically, in the first four months of 2026, while the value of U.S. apparel imports decreased by 12%, imports from Vietnam (up 1.3%), Indonesia (up 2.3%), and Cambodia (up 14.2%) increased. Egypt (up 14.7%) and Turkey (up 6.4%) also became more popular sourcing destinations. In comparison, over the same period, U.S. apparel imports from China (down 50.2%), India (down 28.0%), and Bangladesh (down 11.2%) decreased substantially. Particularly for China and India, the much higher tariff rates imposed on their products were among the critical factors behind their loss of sourcing orders. Regarding Bangladesh, since it primarily produces low-volume items for U.S. fashion companies, it could be disproportionately affected as ordinary U.S. consumers purchase fewer clothing items amid economic stress. [See detailed country market share data here]

Fourth, with the upcoming US-Mexico-Canada Agreement (USMCA) joint review later this summer, the state of U.S. textile and apparel trade with Mexico and Canada has drawn increased attention. On the one hand, the OTEXA data show that the USMCA remained the single largest export market for U.S.-made yarns and fabrics as of 2026. In the first four months of 2026, about 48.4% of U.S. yarn and fabric exports went to USMCA members, including 33.9% destined for Mexico. This share has been highly consistent over the past decades, including when the USMCA replaced NAFTA in 2020. Meanwhile, according to the latest data from the World Trade Organization (WTO), in the first three months of 2026, the U.S. accounted for about 39.3% of Mexico’s textile imports. However, this percentage was noticeably lower than 48% in 2018. Over the same period, China has become an increasingly important textile supplier for Mexico, with its market share rising from 30.3% in 2018 to 38.3%.

On the other hand, in value terms, USMCA accounted for 3.4% of U.S. apparel imports in the first four months of 2026 (including 2.8% from Mexico), slightly up from 3.2% over the same period in 2025. Despite the relatively low market share compared to Asian suppliers, it should be noted that in the first three months of 2026, nearly 98% of Mexico’s apparel exports went to the United States. Data from the U.S. International Trade Commission further show that almost 94% of those exports claimed duty-free benefits under the USMCA in the first three months of 2026, a significant jump from around 80%-83% in the past. USMCA-qualifying apparel has been among the very few products exempt from the tariff hikes since Trump’s second term.

Furthermore, in the first four months of 2026, about 55.3% of U.S. apparel imports from Mexico were cotton apparel, the lowest share since 2021 (around 57%). While the available data did not establish a direct causal relationship, the growing availability of textile inputs from Asia may have contributed to a broader diversification of Mexico’s apparel exports to the U.S. market beyond traditional products such as men’s and boys’ cotton trousers. This trend also underscores the high stakes of USMCA’s review. The agreement’s duty-free preferences and yarn-forward rules have long encouraged the use of U.S.-made textile inputs, especially those cotton-centered, in Mexican apparel production. Without these incentives, Mexican manufacturers could have greater flexibility in sourcing textile inputs from Asia, given the benefits of diversifying their export offerings. Such a shift could reduce demand for U.S. yarn and fabric exports and further weaken traditional Western Hemisphere textile and apparel supply chains.

Additionally, U.S. apparel imports from Sub-Saharan African (SSA) countries declined sharply, down 30.9% in value and 22.3% in quantity in April 2026. So far in the first four months of 2026, SSA countries together accounted for 1.9% of U.S. apparel imports, the same as in 2025. With the African Growth and Opportunity Act (AGOA) renewed for only one year and set to expire at the end of 2026, these results reinforce concerns that U.S. fashion companies are unwilling to expand apparel sourcing from AGOA without a clear long-term policy outlook.

by Sheng Lu

New USITC Report: African Growth and Opportunity Act (AGOA): Program Usage, Trends, and Sectoral Highlights

On April 17, 2023, the US International Trade Commission (USITC) released a new report analyzing the trade and economic impact of the African Growth Opportunity Act (AGOA). The report fulfills the investigation request by the US House of Representatives Committee on Ways and Means in January 2022.

The full report is HERE. Below are the key findings regarding the apparel sector:

The African Growth and Opportunity Act (AGOA) matters significantly to Sub-Saharan African countries (SSA)’s apparel exports to the United States

  • AGOA has been the primary competitive advantage for SSA’s apparel exports to the United States. For example, US apparel imports from AGOA beneficiaries have risen from $953 million in 2001 to $1.4 billion in 2021 (note: up to $1.76 billion in 2022). More than 96.4% of these imports claimed AGOA’s duty-free benefits, including 98.8% utilized the “third-country fabric” provision.
  • While twenty countries were eligible for AGOA’s apparel provision, over 90% of US apparel imports from AGOA members in 2021 originated in five SSA countries: Kenya (31.5%), Madagascar (19.9%), Lesotho (20.6%), Ethiopia (18.3%), and Mauritius (5.1%).
  • AGOA benefits appear essential for SSA countries to maintain their apparel exports to the United States. USITC noted that in every case when a country lost AGOA eligibility between 2000 and 2021, there was a noticeable decrease in US apparel imports from that country, such as Rwanda and Madagascar. (note: according to OTEXA’s latest trade data, US apparel imports from Ethiopia, which lost its AGOA eligibility in 2022, dropped by 42% in the first two months of 2023 from a year ago, far worse than a 5.8% decrease of AGOA members as a whole.)
  • SSA garment manufacturers often find supplying the US apparel market a better fit than Europe, primarily because US brands tend to place orders for higher volume bulk basics, which allows workers to focus on a narrower set of skills.

The impact of AGOA on SSA’s apparel production and exports varied at the country level

  • Some SSA countries (e.g., Kenya and Lesotho) already had well-established apparel industries when AGOA was implemented in 2000. In contrast, other SSA countries (e.g., Madagascar, Ethiopia, Tanzania, and Ghana) received substantial investments from foreign-owned firms after AGOA was enacted, which helped jumpstart their apparel sectors.
  • USITC also identified two “unsuccessful” AGOA cases. For example, Mauritius was the largest AGOA beneficiary apparel supplier to the United States in 2000 but has since fallen to the fifth-largest in 2021, largely due to increased labor costs. Likewise, South Africa’s apparel export to the US was negatively affected by its disqualification from the “third-country fabric” provision under AGOA.

AGOA has had a limited impact on building an integrated regional textile and apparel supply chain in SSA

  • Currently, SSA countries primarily participate in the cut-and-sew operations of apparel based on imported textile raw materials from outside the region (mostly from Asia).
  • The USITC identified several challenges in building the local textile industry in SSA. For example, building a textile mill typically requires much higher investments (e.g., $200–300 million) than a garment factory (i.e., $25 million). Also, most SSA manufacturers cannot make the various types of yarns and fabrics in demand from U.S. buyers.
  • The dilemma is not new: Access to textile inputs from sources outside SSA is essential for garment manufacturers in SSA to meet the specifications of US buyers. However, relying on imported textile inputs reduces the incentives for investing in new textile production capabilities in SSA.
  • The USITC report found Mauritius an exception as it has developed a relatively competitive capability in producing cotton fabrics, which are supplied to garment factories in Madagascar. There is also some collaboration between cotton producers in Tanzania and Uganda and Kenya’s textile manufacturers.

US fashion companies generally see SSA as a promising emerging sourcing destination

  • Apparel producers in SSA are less established in global apparel value chains than manufacturers in other parts of the world. Therefore, it is not uncommon that fashion brands and retailers “work more directly with SSA apparel manufacturers to ensure product quality, particularly for new or expanding product lines.”
  • Most SSA garment factories only have cut, make, and trim (CMT) capability and rely on imported textile materials arranged by fashion brands and retailers.
  • USITC found that US companies increasingly import man-made fiber (MMF) apparel from AGOA members to benefit from greater import duty savings. (note: US tariff rates for MMF apparel were typically higher than those made with natural fibers like cotton. On the other hand, however, it’s worth noting that SSA countries generally have more competitive advantages in producing cotton apparel products than in producing MMF apparel).
  • SSA countries also have advantages over their Asia competitors. For example, “a shipment takes about 15–18 days to travel from the port in Lomé to the East Coast of the United States. From China or Bangladesh, lead times range from 40–50 days.”
  • Many fashion brands “have expressed interest in sourcing from greenfield factories with fewer legacy challenges posed by compliance and environmental impacts.”
  • US fashion companies’ sourcing diversification strategy to avoid risk exposure also contributed to the expansion of their apparel imports from AGOA members.

Uncertainty of AGOA renewals hurt US apparel imports from SSA

  • Apparel companies typically make sourcing decisions 12–18 months in advance. This practice underscores the importance of renewing AGOA early rather than granting extensions only within two to nine months of expiration, as in the past.
  • The USITC report mentioned, “Without the assurance of the “third country fabric” provision, many US apparel companies sourced from AGOA beneficiaries reported holding back orders from the region.”

More can be done to leverage SSA’s cotton production better

  • Cotton growing is widespread across about thirty SSA countries. SSA accounts for about 7 percent of the world’s cotton production, the fifth-largest globally.
  • However, most SSA cotton is sold to international buyers and exported to Asian mills that process it into yarns and fabrics. In contrast, the consumption of domestic cotton in SSA is limited.
  • The SSA cotton industry produces high-quality, “sustainable” cotton that can be used in several high-value end products sold globally. However, because of a lack of mechanization, SSA cotton production struggles to increase supply to meet demand.
  • Also, cotton-growing regions in SSA tend to be poorer and less politically stable than other parts of the region.

Discussion questions:

  • Based on the blog post and class discussions, how competitive or attractive are AGOA members as apparel-sourcing destinations for US fashion companies, especially compared with suppliers from Asia and the Western Hemisphere?
  • Based on the blog post, what improvement can be made to make AGOA or any problems that need to be addressed?
  • Any other thoughts related to the patterns of apparel trade and sourcing based on the blog post?