Home ›› 24 Dec 2021 ›› Front

Bangladeshi apparels finally see price rise in US market

Arifur Rahaman Tuhin
24 Dec 2021 00:00:00 | Update: 24 Dec 2021 10:41:49
Bangladeshi apparels finally see price rise in US market

Prices of apparel goods exported to the USA rose by 3.3 per cent during July-October of Fiscal Year 2021-22, compared to the same period previous year. Under the same parameters, prices of clothing items increased by 0.9 per cent in the European Union as well.

Moreover, Bangladesh’s readymade garment exports to the US and EU rose by 23.8 per cent and 8.9 per cent respectively, says a Centre for Policy Dialogue study performed recently, based on data from the Office of Textiles and Apparel (OTEXA) and Eurostat.

During this period, Bangladesh’s exports reached $2.50 billion and the volume grew by 19.8 per cent to 56.27 million dozens in the US, when compared year-on-year.

Bangladesh’s exports also reached €5 billion, and the volume stood at 56.27 million dozens at the same time in the EU.

This data indicates that Bangladesh’s overall performance for apparel exports, especially in the US and EU markets, has been quite good in this timeframe.

Speaking to The Business Post, industry insiders said European buyers have been practicing minimum fair prices for a long time, and Bangladesh is enjoying duty-free exports under the GSP facility in that market.

Though most of the US buyers are still not practicing fair prices, local apparel exporters have taken a strong stance on getting fair prices, as they currently have enough work orders from European buyers, sources added.

Addressing this matter, Bangladesh Garment Manufacturers and Exporters Association’s (BGMEA) Vice-President Shahidullah Azim said, “It is a good sign that we are performing well in the US market, and they are beginning to practice fair prices.

“They [US buyers] do not have any alternative sources because of the trade conflict among China and western nations, and China’s power crisis. They [US] are buying from us now as Bangladesh is the only country with the capacity to meet their demand with marginal costs.”

He expects that the sector’s export earnings will increase further in the US market.

Woven products perform poorly

According to Export Promotion Bureau (EPB), Bangladesh’s total apparel goods exports reached $12.62 billion in the July-October of FY22, with a 20.78 per cent growth when compared year-on-year.

During the same period, the overall knitwear sector exports reached $7.21 billion, witnessing 24.27 per cent growth, and woven sector exports earned $5.41 billion with 16.41 per cent growth.

In both the US and EU markets, performance of woven products was not satisfactory, but knitwear products performed quite well.

During the above mentioned period, average prices of per dozen woven clothes rose by only 1.9 per cent, and volume rose 11.1 per cent in the US market. Besides, knitwear product export earnings rose by 44.6 per cent with average prices rising by 14.3 per cent.

At the same time, prices of woven exports fell 2.2 per cent per Kg in the EU market, though value increased 0.8 per cent and volume increased 3 per cent. Knitwear goods prices rose by 3 per cent per Kg, while value rose by 13.6 per cent and volume increased by 10.3 per cent.

Woven exporters said the sector has been suffering from difficulties for some time, and the Covid-19 pandemic exacerbated their problems.

On the issue, Nipa Group’s Managing Director Md Khosru Chowdhury said, “Freight charges had increased four to five times compared to the normal rates. The use of woven products among consumers also dropped due to home office facilities.

“We failed to raise prices of woven goods due to such factors. However, we currently have a good volume of work orders from the US and EU markets, and we are trying to ensure fair prices.”

Bangladesh Knitwear Manufacturers and Exporters Association’s (BKMEA) Vice-President Fazlee Shamim Ehsan said, “When the Covid-19 pandemic hit Vietnam, US buyers looked to Bangladesh.

“We had sought fair prices from them, and these buyers complied due to a lack of alternatives. That is why our export value has increased in the US market.”