An acceleration in supply-chain reshoring is the key reason for 10 consecutive months of declining Chinese exports to the United States, according to trade data, and analysts expect that the fall will continue – with lasting implications for overall exports from the “world’s factory”.
While weak demand caused by a slowing economy and high inflation have suppressed US imports in general, the decline of imports from China has been much more substantial compared with rising imports from countries such as Mexico, according to data from the United States International Trade Commission (USITC).
The drop has led to a sharper shrinkage of China’s share across all major products that it has been the biggest supplier of to the US, since late last year, even after Beijing lifted its strict zero-Covid policy that once caused severe supply-chain disruptions.
The trend is particularly remarkable in textiles and apparel. In the first four months of this year, 20.9 per cent of textiles and apparel that the US imported were from China – down about 4 percentage points from 2022, and almost half of the total seen 10 years ago, according to figures from the Office of Textiles and Apparel under the US Department of Commerce.
Apart from Covid-related supply-chain disruptions and US-China trade tensions, the implementation of the Uygur Forced Labour Prevention Act last June has further discouraged US fashion companies from sourcing cotton products from China, according to Sheng Lu, an assistant professor of fashion and apparel studies at the University of Delaware.
For furniture and toys – two other low-cost consumer products that Chinese factories have long dominated the global supply of – China’s share of US imports plunged well below 50 per cent in January-April – the first time they have fallen below that mark since 2001, figures from the USITC showed.
The assembly of finished goods in the furniture industry is now increasingly being done in Mexico, according to a report this month from Kearney, a Chicago-based management consulting firm.
By Ji Siqi. 20 Jun, 2023.
Source: South China Morning Post (SCMP). https://www.scmp.com/economy/china-economy/article/3224790/where-are-chinas-exports-going-less-and-less-us-latest-trade-data-confirms. 26 June 2023.
Scroll To Top