Along with China's competitors, Indonesian and Vietnamese exporters of man-made fiber apparel had a glorious year on US market in 2004.
US MMF apparel imports from China rose 34% in volume terms in the January-November period of 2004 (latest available data) while shipments from Indonesia and Vietnam were up 24% and 34%, respectively.
The three countries gained significant shares in the US import market in 2004, as total MMF apparel imports only increased by 7.88%.
In order to compete against China's rush on the US market, Indonesia benefited from a fall in its currency against the dollar. The Chinese yuan is pegged to the American currency, in sharp contrast.
Indonesian exporters also took advantage of the new quotas that were imposed on US imports from Vietnam for the first full year in 2004.
On their side, Vietnamese exporters seized an opportunity to boost sales in categories that remained free while China's exports continued being subject to US limits.
A complete change may be in sight after US quotas were removed on US imports from China and Indonesia. US limits still apply on shipments from Vietnam since this country did not yet join the WTO.
In categories where US quotas were eliminated in January 2002, shipments from the PRC already surged.
After US imports further rose 161% in January-November 2004, China has a 57% share of total US imports in category 632 (MMF hosiery) for instance.
Shipments from Indonesia and Vietnam are negligible in this specific category of products, in addition.
In category 649 (MMF bras), imports from China were up 28% in volume terms but shipments from Indonesia also increased by 25% at the same time, after Washington reimposed limits on China's products.
For the same reason, US imports from Indonesia surged 42% in category 650 (MMF dressing gowns) while "only" up 27% for China's items.
Where China's exports were still subject to very low US limits, imports from Indonesia sharply rose in the past year.
Shipments were up 32% and 39% in categories 647 (M/B MMF trousers) and 648 (W/G MMF trousers), respectively. Imports from China fell 19% and 5% at the same time.
Imports from Vietnam were also sharply down after Vietnam's quota were fully filled in 2003, resulting in overshipments and costly embargoes at US borders.
Nearly all US quotas placed on China's exports were more than 90% filled in man-made fiber categories in 2004.
As a consequence, a sharp rise in US orders may be expected in the current year after elimination of quota fees will result in much lower export prices in China, in addition.
On the other hand, Washington could reimpose quotas in major categories. Such a threat may have dissuaded US buyers to concentrate sourcing in China, to the benefit of Indonesia and possibly Vietnam.
US imports from Vietnam continued sharply rising in 2004 in categories that are not subject to quotas, such as 643/644 (MMF suits).
Korean and Taiwanese investors will take full advantage of their recent investments when the country will join the WTO later in the year or in 2006, with an immediate elimination of US quotas as a consequence.
