Supply Chain Research

U.S. apparel imports continued to struggle in October. Putting aside out-of-season products such as t-shirts and skirts, seaborne imports of trousers declined 17.5% on a year earlier while coats declined by 4.8%. Part of this has been driven by retailers taking tighter control of inventories, as discussed in Panjiva research of November 14.

The reduced rate of decline seen in some categories – for example shirts which fell just 0.3% after a 1.9% decline in September and 2.6% slide in August – may suggest the destocking may be reaching its end. The two categories that have seen an improvement are dresses, which climbed 22.0% after a 5.1% increase in September, and sweaters, where imports inched ahead 0.1% on a year earlier after falling for four months.

Data based on HS code searches for trousers, dresses, skirts, shirts, t-shirts, sweaters and coats Source: Panjiva

The stabilization in imports of sweaters appears to be driven by a 4.0% increase in the kids category. This likely reflects an expectation from retailers of delayed purchases from the back-to-school season after September proved to be warmer-than-normal in many areas.

Data for HTS 6110, modified ‘kids’, ‘boys’, ‘girls’ and ‘children’, with remainder taken to be adults’ Source: Panjiva

By contrast, the marked increase in the import of dresses was driven by the adult segment, with the kids category actually contracting 4.7% in October on a month earlier. This was a slower rate of decline than in previous months however. From a fabric perspective cotton lagged the average, with a 9.4% growth in October while other fabrics (including synthetic and artificial classifications) increased 28.7%.

Data for shipments of dresses based on HS codes for fabrics (including cotton), segmented by keyword for adults vs. kids. Lower panel shows change in all imports of dresses Source: Panjiva

One fabric that is still having a tough time is denim. Total imports of denim products fell 9.5% on a year earlier in October, reversing a 1.6% increase in September. This has come despite indications from a Piper Jaffray survey earlier this year suggesting kids denim products were becoming more popular. That segment actually fell 10.4% in October. The weak performance may also explain the 6% drop in VF Corp’s jeanswear revenues in the third quarter on a year earlier, and suggests it may not reverse immediately.

Import analysis based on keyword search for denim, filtered by for age-specific qualifiers Source: Panjiva