Unlike gasoline, housing, food, and auto loans, apparel is a discretionary purchase.
What are consumers and importers doing?
Here are some numbers from OTEXA, the Office of Textiles and Apparel. Glance at the chart (click on it for a sharper image), then follow the discussion below to understand what is happening.
US Apparel Imports by Country
Chart from reader Tim Wallace. It represents about 86% of US apparel imports. Tim writes …
I get data straight from OTEXA, looking at the apparel consolidation line under SME – Square Meter Equivalents – which is volume, not dollars.
Mish note: Dollar amounts are likely a better way of looking at things. From that perspective, global imports look much worse than the above chart implies.
The following synopsis will help clarify things.
- After huge numbers for January and February, with import volume up a total of 12.84% at the start the year, volume is negative year to date. Since March, import volume is down 5.09% globally. China is down 7.57%.
- Global import volumes were down 1.33% in June, 3.51% in July, and 4.26% in August, progressively worsening numbers.
- Year to date, shipping volume is down 1.8% globally and 2.26% in China.
- In dollar terms, global imports are down 4.46% year to date. China is down 7.73% year to date.
- Demand was strong in January and February, but overall demand is very soft.
- The numbers for September will come out on November 4.
Scroll down the column “Change Since March” to see weakening demand volumes.
- By volume, apparel imports are down 1.8% globally, and 2.26% from China
- By price, apparel imports are down 4.46% globally, and 7.73% from China.
- China accounts for 41.52% of volume and 35.1% of price.
Price is weakening much faster than volume.
This data was not impacted by Hanjin. The Hanjin impact starts in September.
Hanjin refers to the bankruptcy of a global shipper, with merchandise unable to dock.
On September 3, Stratfor wrote Hanjin’s bankruptcy reveals much about the world economy
Buffeted by overcapacity in the global shipping market, South Korean giant Hanjin Shipping Co. appears to be sailing toward oblivion. In the past week, creditors pulled the plug after 1 trillion won ($900 million) in support failed to keep the company afloat, forcing Hanjin to file for bankruptcy protection. Seoul Central District Court, which will decide the eventual fate of the company, has set a Nov. 25 deadline for Hanjin to develop another restructuring plan, but many experts think liquidation will be the most likely outcome.
In the short term, the company’s demise has temporarily raised some shipping rates, which have remained persistently low industrywide thanks to the sluggish global economy. It likely will also cause some supply disruptions during the peak season for orders of holiday goods.
But even if the company, the eighth largest by capacity in the world, finds an unlikely way out of its predicament, the underlying problems of overcapacity and sluggish global demand growth will continue to hamper the industry. In addition, the collapse of Hanjin deals another blow to the South Korean economy, which faces stiff competition in the high-tech market from rivals Japan and China.
Once Hanjin filed for receivership, it set off a cascade of effects for its ships already at sea. Nearly a dozen of the ships operated by the company have been seized or detained at international ports in both Singapore and China. Additionally, because each entity along its logistics chain — from tugboats to truckers moving containers — is worried about getting paid, the company’s ships that are already loaded and crossing the ocean will face difficulties as they reach their destinations. Not only have ports denied the vessels access, but they can be seized if they are allowed to dock. Those idle ships would then clog up these ports, which could lead to additional delays. Furthermore, other firms are also refusing to work with Hanjin, in fear that there would be no payment for services. Numerous ships are sitting at anchor, waiting to see how the bankruptcy process plays out.
Christmas Season Hints
As it stands now, it appears retailers expect soft demand this Christmas shopping season, at least for apparel.
Mike “Mish” Shedlock
I buy 95% of my clothes second-hand at a local thrift shop.
I bought a pair of leather Sketchers casual shoes hardly worn for $10 that would have cost me at least $80 retail. Took ’em home and slapped some leather conditioner on ’em – they look like I just bought them at Macy’s.
Why should I pay the retail man top dollar when I can get practically new items at the Thrift Store at a discount of 80% or more? Pride??? ha.
I’m doing my part to bankrupt China. What are you folks doing?
The government bean counters must be following my buying habits and calculating my habits into their numbers.
Half-off sale at the Thrift Store today. I’ll be stopping by.
Same here…Although I recently broke down and bought a brand new Hillary for Prison t-shirt, and I get almost as many compliments as my best thrift store finds.
I have nothing against China, per se. All the major brands source all over, and Vietnam, Philippines, Bangladesh, Pakistan, India, Lesotho, Mexico, Japan, Korea, etc. all work well for me. I have someone who takes the old clothes to the poor people in Mexico. The days of finding clothing made in the USA are not entirely over, but the minimum wage mandates are driving those remaining companies in California out of the country. I imagine the thrift store stuff is an equal mix, including Chinese goods.
I used to get Tommy Bahama and Nat Nast shirts and sweaters from eBay for pennies on the dollar. Now, I’m back to t-shirts and jeans with v-neck sweaters over the t-shirts in winter. Amazon is great for that. Shoes from Amazon are almost a gift if you shop well. JC Penny has massive sales in off season clothing. I love them. I also love inventory overstocks. I’m the guy who lives to clear it out when it becomes distressed and the seller is desperate.
I saw a curious video regarding the country of Yemen. It said the new clothing industry was now dead, while a tremendous second hand clothing industry was building up using clothing imported from France. Freighters filled with clothing arrive from France and entrepreneurs buy and distribute it from the dockside. A lady said the quality of the french stuff was superior to the native so why buy it.
Philippino lady I know started making good money shipping used clothing from Spain to the Philippines. Westerners throw out near new continuously, so cheaper than from China or local, even after a round trip. Reminds me of a local market right outback in Africa… t-shirts were highly prized and few wore them, a mundane old shirt fetched big (local) money there.
dentss dunnigan said:
I buy mostly from thrift shops ,and craigslist ….but still looking for a good secondhand underwear shop in the NYC area …if you know of one …….?
Doesn’t Huma’s estranged hubby live in the NYC area? Contact him.
Interesting. Apparel sales down, gun sales up. What are hem lines doing?
mission accomplished said:
Beware the Butt Naked brigade
Again, I will suggest that China will continue to lower prices to hold market share or increase it, to keep their industries running and protesters off the street. They have stockpiled massive amounts of raw materials and fuel as well as purchased huge mount of assets all over the world, while building factories that have yet to be used. Meanwhile we recoil in abhorrence at the mention of protectionism and NEVER promote American industry over importation. We have US corporations operating under the guise of “free trade” supported by and of the Chamber of Commerce pushing for more trade deals that favor their few and narrow interests at the cost to our industries as a whole…the proof of which is easily seen in our declining manufacturing jobs.
We will watch as our remaining jobs evaporate under the promise of some new government funded and inspired economic “plan” creates even more opportunities for entry level jobs at Wendys.
I question how long we can expect service sector jobs to sustain us when prices for our needs continue to fall, making it more cost effective to replace than repair, and automation is replacing so many other service related jobs.
What is it that we collectively think is our goal here? What is a good thing?
Tim Wallace said:
The most interesting thing is CHINA is the one trying to develop Africa to make apparel. Just finished a rail line in Ethiopia, $250 million apparel factory development.
The Chinese have millions of workers willing to work for near nothing and no laws to protect them, yet they still add automation and seek out even cheaper labor sources. Once they depressed world prices and effectively destroyed all western world manufacturers, then they will own the world, and us in it. We are trading our liberty for cheap imports and the promise of eternal entitlements, neither of which will be sustainable.
Am I simply a glass half full kind of guy, or is this a reality???, because no one else seems to agree or give a damn.
You think like a chess player; however, the US gov’t thinks like a tic-tac-toe player.
Disaster provides far more opportunities to government power than prosperity ever would. Hard to image how we have had it this good for this long.
Michael Rudmin said:
No, your LEADERS are trading YOUR liberty. Which wasn’t yours, or they couldn’t trade it.
You’ll know, because nowhere is freedom less than where that fact is continually drummed in to your head.
When you hear the drums, you’ll know.
It’s one of the first things learned from Mish: Global Wage Arbitrage.
Say it again, because it’s having a massive effect on the world: Global Wage Arbitrage.
The internet provides a level playing field of information. Those that used to have a monopoly on information, such as the US and Europe, on things such as manufacturing and technology, find they no longer have that monopoly. All boats will fall and/or rise to a level playing field.
USA and Europe are falling, and have been falling. Asia has risen. And now it’s time for Africa to rise. You will see the day where we have equal access to information, technology, and manufacturing, a totally level playing field. Then it’s really on. This is extremely deflationary.
The only differences will result from how permissive governments are with competition.
If US, and Europe in particular, don’t get on board with allowing more competition, you will eventually see the living standards in Asia and Africa rise above ours. Laugh at your own risk.
China is at least doing something positive for Africa. USA money just lines the pockets of dictators or goes to killing. China’s Ethiopia rail line and other projects should be contrasted with the USA State Dept. under Hillary that bombed the hell out of Libya and scattered arms and mercenaries into other neighboring countries. China is good for Africa. USA people are terminally ignorant about Africa.
Truth seeker said:
Mish aren’t u going to say something about the Trump trash mouth scandel?
I thought we were supposed to be enraged that this was exposed rather than the exposure’s content, just like we were upset over the hacking of Hillary’s emails, rather than their content.
Aren’t we supposed be offended by the exposure of his comments rather that their contents, just like we were with the hacking of Hillary’s emails rather than the content that inferred criminality?
mission accomplished said:
I’m waiting on more important developments like the underwear with skid marks expose.
The larger question is how will Trump ever be able to negotiate with Putin after this? I mean really, will Putin still respect the womanizing Donald after this, or just exchange fist bumps?
This really is preposterous. My god, follow the sexual escapades of most of the EU leadership. Of course, it is considered “progressive” over there. At least there were no animals involved.
There is no reality anymore that matters. We can have liberal Code Pink protesting every barbeque of W, yet eight years of interventions and death from Obama barely raise an eyebrow. Now we have the left chanting for war with Russia in defense of our unauthorized interventions and claiming the Donald is a Russian puppet. Does any of these fools ever look in a mirror?
Here’s what they are talking about on Mexican TV talk shows.
@TS – “Mish aren’t u going to say something about the Trump trash mouth scandel?”
First, learn to spell scandal. Basic spelling errors in an era with spell check makes you look like an idiot.
Second, look up the womanizing history of JFK and Bill Clinton. I would suggest you look at the stories about what goes on in hollywood / media marriages, but Bill Clinton getting a blow job from an intern in the oval office is mild compared to what racist and self righteous media people do.
Third and most important, the story says a lot more about the terrible state of the media profession than it does anything else. Real journalists are supposed to be neutral and objective.
It is not news that the media profession wants Hillary — they are entitled to their personal opinions, but they are not entitled to mislabel their opinions as journalism.
I doubt anyone will change their vote based on the media’s self-righteous nonsense.
Voters who think for themselves — instead of mindlessly obeying the TV — know Hillary is guilty of perjury and treason (not to mention the enabling of her husband’s chauvinist behavior).
Educated people know how to spell scandal, and know that Trump often SAYS stupid things while making some rather savvy business moves.
Its not the sex scandals of politicians voters care about, its the economy stupid
Sexual assault is never ok. Bragging about it is even worse. It doesn’t matter what others are doing. He is the one running for president.
It’s a gift to Trump if handled correctly. Hillary’s support for Bill’s transgressions is ignored. She attacked his victims publicly. Taking that into consideration along with her unending lies, special treatment under the law, war mongering, hypocritical liberal support, and more …She IS a basket of deplorables. Giving her a soft ‘Presidential;’ treatment will lose him the election. He needs to give her public shortness of breath.
Truth seeker said:
Pence would make a great president as opposed to Hillary don’t u think?
We have a very low bar when it comes to competing against Hillary, but regardless, to dump Trump at this late date ensures a Hillary election.
It is beyond hypocritical to suggest that Trump is unacceptable after the history of Kennedy, Johnson and Clinton sexual improprieties. Rich indeed. Trump had but a foul mouth whereas the others are men of action and deeds. FARCICAL.
I do apologize if your delicate sensibilities have been harmed. We just don’t have the patience to wait for the return of Christ. But I’m sure he is coming.
Ya think this was all planned far in advance – in addition to keeping the multitude of Hillary scandals out of the news for the final month?
They’ve corralled the sheeple just to where they want them. About time for another shearing and then to the gallows with no last meal.
The media follows instructions well.
It is obvious to me that this was held until now to be used in desperation. It is a story with no legs and will dissipate quickly as there is far too much worse Bill Clinton ammo. Trump,a womanizer….who could’a known. Three beauty queen wives and a high roller.
Truth seeker said:
If they don’t dump Trump it’s over. We all know about the sexcabades with Clinton, Johnson, Kennedy and others but they didn’t get caught, except for Clinton but not before the election.Believe me Trump is finished. He should quit to save the country from Hillary and Bill the most corrupt people n the country’s history!
Caught? They were suppressed by the media.
Further, I believe few if any are surprised by this expose and the republicans feigning horror are doing so because they were never for Trump in the first place or they are running for reelection and fear for their lives.
A Trump surrender was gain us as much as a retreat from Iraq. It would be an admission that Trump IS unqualified to serve, and the entire republican side of the ticket will be tarred with this. Do you think the media would give Spence a chance after he has so wholeheartedly endorsed Trump?
Sorry, but it is Trump or nothing for conservatives. Stop reinforcing the progressives lame attack and get a spine.
Your sentences are incomplete. “If they don’t dump Trump it’s over” for Hillary.
The GOP and Dem War Party is trying to make it about words and politically correct utterances. A good strategy, because if it was about Hillary’s actions as Secretary of State, the tax-free monies collected from foreign governments and crony capitalists for the Clinton Foundation, the Libyan and Middle East killing field fiascoes, etc. then Hillary has not a chance.
Words that are politically incorrect and protested by the media strengthen Trump. That should be clear by now. Might as well tell Hillary to quit for being so incompetent that she could not protect her private emails from hackers or do a better job of lying about them. Incompetent and a bad liar, a real presidential two-fer for Hillary. The real comedy is that the GOP cannot accept winning with Trump and controlling the Supreme Court; a party of dunces.
Agree. Trump needs to go on strong offensive and give HRC public shortness of breath. He has nothing to lose at this point given HRC is a basket of deplorables. He will look strong. The Establishment has abandoned him so he has nothing to lose with them. They will look cowardly and ridiculous. Looking Presidential at this time is looking weak.
Mission Accomplished said:
I love it
Reed Bates said:
There are a whole lot of guys walking around my town who got deep discount bargains on their trousers. They’ve got their pants half off.
Truth seeker said:
Ok I’m the one who has gotten everybody stirred up with my dump Trump statement. Since I am 71 years old with 6 grandkids I have more contempt for Hillary Clinton than all the rest of u put together. Our culture is saturated with drugs, violence, pornography, corruption and debt and there is absolutely no respect for traditional values r the rule of law. What makes Trunp’s statement so damning to me is the fact he’s chasing after a married woman. We cannot have strong families, growing together with hard work, discipline, sacrifice and other Christian values and virtues without strong traditional marriages, the backbone of every strong society.
What ties these two issues together,? The spotlight on apparel and Trumps bid for political office is the matter of globalism. We must decide what kind of country we want to live in and where the world is heading. This polarizing subject has created some rather strange bedfellows and alliances.
Over the last several years the “stop globalization” movement has gained support in developed countries across the world. Currently, the forces against globalization are growing stronger, globalization seems to be a magnet pulling blame for many of the problems we see across the planet.
A discussion of globalization can include several issues such as, immigration and free trade. Other social concerns also feed into the mix, things like global warming, nationalism, inequality, even population growth. The article below delves into this matter.