American textile industry shows signs of recovery


American textile industry shows signs of recovery Due to the new natural gas and oil hydraulic fracturing methods and the increase in wage costs in Asia’s largest economy, manufacturers are considering moving production to the United States, so “Made in China” is becoming more and more depressed.

A recent report by the Boston Consulting Group (BCG) revealed that the United States will increasingly move closer to China in terms of production costs. In addition, the report also stated that by 2015, production costs in the United States will fall by 8-18%, which is far lower than the cost of other major countries, including Germany, Japan, the United Kingdom, France and Italy.

The recovery of the US textile industry has been reflected in the profitability of the major US textile companies in the second quarter. Uncle Sam’s figures for the second quarter of 2013 are strong proof that the U.S. textile industry’s net profit was US$505 million, an increase of 31% over the same period last year.

At the same time, the second quarter of domestic apparel manufacturers also increased by about 14% year-on-year. In terms of profits, textile mills also increased by 100 basis points over the same period last year.

On the other hand, the report stated that the growth of China's textile industry slowed down in the first five months of this year. Statistics from the General Administration of Customs show that figures for June showed that China’s textile and apparel exports amounted to US$24.1 billion, a decrease of 8.5% over the first five months of 2013.

There is more good news for the US textile industry. This trend may continue due to the economic growth. In the third quarter of September 2013, the U.S. economy grew by 2.8%, compared with analysts expecting an increase of 1-2.3%. In addition, this trend indicates that compared with China, the cost of labor and raw materials in the United States remains under control.

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