logo
Could American cotton be a way around U.S. tariffs?

Could American cotton be a way around U.S. tariffs?

Fashion Network29-04-2025

Major apparel-producing nations—Bangladesh, Pakistan and Indonesia—are increasingly turning to American cotton purchases as a bargaining tool in negotiations to avoid U.S. tariffs on clothing imports. While each country operates under different economic conditions, they share a common strategy that may face hurdles, including limited U.S. production and China's dominant position in the cotton trade.
The National Cotton Council of America (NCC) has recently seen a surge in engagement from foreign buyers. Several of the United States' key cotton importers are leveraging their purchasing power to gain relief from the elevated tariffs imposed on apparel by the Trump administration. This effort includes the Bangladesh Textile Mills Association (BTMA), which has launched direct discussions with U.S. officials.
The United States is the world's fourth-largest cotton producer—following China, India, and Brazil—with an output of 12 million bales in 2023, representing 11% of global production. In 2024, Bangladesh became the fifth-largest importer of U.S. cotton, purchasing $270 million worth. As talks progress, Bangladesh has expressed a willingness to significantly increase the percentage of American cotton in its raw material mix, which currently accounts for just 12%.
'We firmly believe this volume can increase four- to fivefold in the near future through mutual cooperation and political support,' said BTMA President Showkat Aziz Russel. He emphasized the 'longstanding and fruitful partnership' between the Bangladeshi textile and apparel sectors and the United States.
Bangladesh's top priority is to avoid the new 37% tariff, which has increased from 10% previously. In 2024, the U.S. imported $7.5 billion worth of apparel from Bangladesh, placing the country behind China, Vietnam, and India among America's top suppliers.
Pakistan's strategy
Pakistan is pursuing a similar cotton-based approach to influence trade talks, albeit from a different vantage point. While it is the world's fifth-largest cotton producer, it also ranks fourth in U.S. cotton imports—trailing China, Vietnam and Turkey.
In 2024, Pakistan exported $2.1 billion in apparel to the United States. The country is now weighing the possibility of increasing imports of U.S. cotton and oil to negotiate exemptions from the tariff hikes.
Although Commerce Minister Jam Kamal Khan remains optimistic, concerns persist. Industry leaders warn that the trade war targeting China could inadvertently favor India and Vietnam—both of which ship larger volumes of apparel to the U.S. than Pakistan. Vietnam, in particular, is drawing attention as Chinese manufacturers relocate operations there to circumvent tariffs aimed specifically at Chinese-origin goods.
Indonesia's diplomatic balancing act
Indonesia, the fifth-largest apparel exporter to the U.S. with $4.2 billion in shipments in 2024, is also positioning U.S. cotton as a key element of its trade negotiations. This strategy aligns with the economic diplomacy led by Minister of Economic Affairs Airlangga Hartarto.
Indonesia produces little cotton domestically and relies heavily on imports from Australia and Brazil. Shifting toward American cotton would mark a significant change in sourcing policy.
However, a major challenge remains: the U.S. cotton supply is limited. This shortage could spark competition among countries seeking access as they try to work around American trade barriers.
China currently accounts for 18.4% of U.S. cotton exports, making it the largest foreign buyer. However, China is subject to the same tariffs, its commanding market share allows it to influence access to American cotton, potentially restricting availability for Asian rivals and tightening its hold on the global supply chain.

Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

Nighttime curfew in LA as Trump vows to 'liberate' city
Nighttime curfew in LA as Trump vows to 'liberate' city

LeMonde

time11 minutes ago

  • LeMonde

Nighttime curfew in LA as Trump vows to 'liberate' city

A nighttime curfew was declared in Los Angeles on Tuesday, June 10, as local officials sought to get a handle on protests that Donald Trump claimed were an invasion by a "foreign enemy." Looting and vandalism has scarred the heart of America's second biggest city as largely peaceful protests over immigration arrests turned ugly after dark. "I have declared a local emergency and issued a curfew for downtown Los Angeles to stop the vandalism, to stop the looting," Mayor Karen Bass told reporters. One square mile of the city's more-than-500 square mile area will be off-limits between 8 pm and 6 am for everyone apart from residents, journalists and emergency services, she added. Small-scale and largely peaceful protests − marred by eye-catching acts of violence − began Friday in Los Angeles as anger swelled over ramped up arrests by immigration authorities. At their largest, a few thousand people have taken to the streets, but smaller mobs have used the cover of darkness to set fires, daub graffiti and smash windows. Overnight on Monday, 23 businesses were looted, police said, adding that more than 500 people had been arrested over recent days. Protests have also sprung up in cities around the country, including New York, Atlanta, Chicago and San Francisco. 'Provide protection' Trump has ordered 4,000 National Guard to Los Angeles, along with 700 active-duty Marines, in what he has claimed is a necessary escalation to take back control − despite the insistence of local law enforcement that they could handle matters. A military spokeswoman said the soldiers were expected to be on the streets later Tuesday or some time on Wednesday. Their mission will be to guard federal facilities and to accompany "federal officers in immigration enforcement operations in order to provide protection." The Pentagon said the deployment would cost US taxpayers $134 million. Photographs issued by the Marine Corps showed men in combat fatigues using riot shields to practice crowd control techniques at the Naval Weapons Station Seal Beach. 'Behaving like a tyrant' Two dozen miles North, the sprawling city of Los Angeles spent the day much as it usually does: Tourists thronged Hollywood Boulevard, tens of thousands of children went to school and commuter traffic choked the streets. But at a military base in North Carolina, Trump was painting a much darker picture. "What you're witnessing in California is a full-blown assault on peace, on public order and national sovereignty, carried out by rioters bearing foreign flags with the aim of continuing a foreign invasion of our country," he told troops at Fort Bragg. "This anarchy will not stand. We will not allow federal agents to be attacked, and we will not allow an American city to be invaded and conquered by a foreign enemy." Partner service Learn French with Gymglish Thanks to a daily lesson, an original story and a personalized correction, in 15 minutes per day. Try for free California Governor Gavin Newsom, a Democrat who has clashed with the president before, said Trump's shock militarization of the city was the behavior of "a tyrant, not a president": "Sending trained warfighters onto the streets is unprecedented and threatens the very core of our democracy." In a filing to the US District Court in northern California, Newsom asked for an injunction preventing the use of troops as any kind of policing force, and demanding they be confined to guarding federal buildings. District Judge Charles Breyer scheduled a hearing on the motion − which charges that Trump and Defense Secretary Pete Hegseth have violated the US Constitution − for Thursday. 'Incredibly rare' Trump's use of the military is an "incredibly rare" move for a US president, said Rachel VanLandingham, a professor at Southwestern Law School in Los Angeles and a former US Air Force lieutenant colonel. US law largely prevents the use of the military as a policing force − absent the declaration of an insurrection, which Trump again mused about on Tuesday. Trump "is trying to use emergency declarations to justify bringing in first the National Guard and then mobilizing Marines," said law professor Frank Bowman of the University of Missouri.

The Chinese Communist Party's endless push for austerity
The Chinese Communist Party's endless push for austerity

LeMonde

timean hour ago

  • LeMonde

The Chinese Communist Party's endless push for austerity

Letter from Beijing On March 22, a group of about 10 officials from the rural canton of Luoshan, located in central China, took their lunch break together amid a day devoted to the "in-depth study of the eight-point regulation." Under this rather uninviting seminar title, local leaders were once again required to review an edict from the central authority dating back to December 2012, just weeks after Xi Jinping became head of the Chinese Communist Party. This piece of legislation, which marked the start of a strict austerity campaign within the single-party system under Xi, emphasized the importance of "staying close to the masses." It called for giving up unnecessary meetings and lavish meals, avoiding traffic blockades for official motorcades and no longer rolling out welcome banners or massive floral arrangements for routine inspection visits. Since rising to the top, Xi has never tired of repeating that formalism, hedonism and corruption are threats to the system's survival. The strict regime imposed by the central government on the lower echelons of bureaucracy in Beijing's attempt to reassert control is summed up by the phrase "four dishes and one soup." Chinese officials are therefore expected to toe the line; this was the very set of rules reviewed by the Luoshan leadership at the start of that seminar day.

Chinese beauty brands explore foreign M&A to spur growth
Chinese beauty brands explore foreign M&A to spur growth

Fashion Network

time2 hours ago

  • Fashion Network

Chinese beauty brands explore foreign M&A to spur growth

​Some of China's top beauty brands such as Proya and S'Young are exploring acquisitions of smaller foreign rivals to expand their portfolios and replicate the success of global leaders like L'Oreal or Estée Lauder amid slowing growth at home. While still relatively unknown internationally, these Chinese brands have found significant domestic success, even capturing market share from global players. But a prolonged property crisis and concerns about wage growth and employment security have dampened consumer spending in China - posing new challenges to their continued growth. Proya Cosmetics', opens new tab founder, Hou Juncheng, said last month that the company's 10-year plan aims to position the firm among the top ten globally, a goal that would require an annual revenue of at least 50 billion yuan ($7 billion). To do so, the Hangzhou-based Proya plans "to acquire some European brands with history and technology", local media reports cited Hou as telling shareholders at a meeting. Proya, which specialises in science-backed skincare at mass market price points, became the first Chinese beauty player to surpass 10 billion yuan in annual revenue in 2024. In comparison, Japan's Shiseido, opens new tab, currently ranked tenth globally, raked in $6.9 billion and market leader L'Oreal generated over $45 billion in revenue last year. S'Young and Ushopal, two prominent Chinese beauty groups, have already made strides in international acquisitions. S'Young owns French skincare brand Evidens de Beaute and U.S.-brand ReVive, while Ushopal added French brand Payot to a portfolio that includes British skincare label ARgENTUM and French fragrance Juliette has a gun. William Lau, a partner at Ushopal, said the company plans to acquire one to two new brands annually. Analysts say buying foreign brands can help Chinese beauty firms diversify revenue streams and reduce reliance on the domestic market, but they also note that some similar efforts by Chinese fashion groups had missed expectations in the past. The beauty and personal care market is projected to generate a revenue of $677.19 billion globally in 2025, versus $41.78 billion in China, German data provider Statista estimates. Chinese brands are likely to target premium-positioned European skincare, fragrance or haircare brands with valuations under $500 million, said Gregoire Grandchamp, co-founder of Next Beauty China, who has advised Chinese groups on global deals. "In coming years, there will be a big Chinese company that will be the Chinese L'Oreal, Estée Lauder, Shiseido, or Amorepacific," Grandchamp predicted. Acquisitions have long been a growth strategy for beauty giants. L'Oreal's $2.5 billion purchase of Australian brand Aesop in 2023 added a premium, natural cosmetics brand to its portfolio, while Estee Lauder's, opens new tab $2.8 billion acquisition of Tom Ford in 2022 helped boost its array of high-end perfumes. Chinese beauty brands aim to borrow from this M&A playbook, but there are concerns about their ability to operate brands outside their home turf. In the fashion space, state-owned textile giant Ruyi once made headlines for snapping up foreign brands and touting its ambition to become "China's LVMH" only to see those international deals unwound by creditors in a few short years. But Ushopal's Lau says these challenges are not unique to Chinese groups, citing examples like Shiseido's buyout of Drunk Elephant to L'Oreal's purchase of some Chinese brands that struggled to meet expectations. "Global acquisitions are very difficult" in general and part of the problem is that companies often try to localise brands too quickly after a deal, he said. "One of the reasons you buy a brand is because it's an amazing brand, so if you then redo the entire DNA of the brand, what's the point of buying it?" he added. Mark Tanner, founder and managing director of Shanghai-based marketing and research agency China Skinny, said: "Opening doors to the Chinese market and capital injections, rather than a wholesale management takeover" are more likely to succeed.

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into the world of global news and events? Download our app today from your preferred app store and start exploring.
app-storeplay-store