As against competitors like China, Vietnam and India which experience growth, Bangladesh’s RMG exports to the United States declined by 6.28 per cent Y-o-Y to $5.21 billion in Jan-Sep’24period as against $5.77 billion registered in the same period in 2023. Bangladesh’s RMG exports volumes to the US also declined by 1.49 per cent to 1.73 billion sq m during the period, shows data by the US Department of Commerce’s Office of Textiles and Apparel (OTEXA).
Despite thisdecline, Bangladesh continued to be the third-largest apparel exporter to the US, holding a 9.07 per cent market share, behind China at 21.06 per cent and Vietnam at 18.75 per cent. Notably, Vietnam's RMG exports to the US increased by 1.22 per cent to $11.21 billion, while India’s shipments grew by a modest rate of0.47 per cent to $3.63 billion. RMG exports by Cambodia and Pakistan to the US also increased by 7.09 per cent and 2.32 per cent, respectively.
Exporters cite domestic challenges such as extended lead times, inconsistent energy supplies and high operational costs as factors contributing to Bangladesh’s negative growth. Additionally, recent gas and electricity shortages have disrupted factory operations in the country, preventing them from running at full capacity. Further straining the sector, unrest and political instability have further is affecting production schedules and raising concerns about potential shifts in work orders.
A study by the US Fashion Industry Association (USFIA) indicates, diversifying their sourcing strategies, American fashion companiesareexploring emerging destinations like India. Supply chain disruptions, shipping delays, and geopolitical concerns remained top issues of concerns for US brands in 2024.
China’s apparel exports to the US also declined by 2.28 per cent to $12.50 billion. While overall US apparel imports decreased by 2.57 per cent to $59.32 billion in the first nine months of 2024, the volume of these imports rose by 2.57 per cent, with imports from China increasingby 4.06 per cent, imports from Vietnam rising by 6.66 per cent, shipments from India expanding by 9.58 per cen, imports from Cambodia increasing by 11.43 per centand those from Pakistan rising by 1.63 per cecnt from Pakistan.
Fazlul Hoque, Former President, BKMEA, notes, while global demand had been sluggish, it is starting to recover, with work orders improving despite pricing pressures. Mahmud Hasan Khan, Rising Group adds, the upcoming work-order outlook for early 2025 is positive, though pricing remains challenging. Exporters acknowledge, compounded by gas shortages and banking delays in opening back-to-back LCs, Bangladesh’s lead-time issues pose significant obstacles.
These challenges give China and Vietnam, with their efficient lead times and reliable energy supplies, a competitive edge. Exporters stressed that meeting shorter lead times is crucial for maintaining orders, which Bangladesh struggles to achieve amid its current constraints.
