Looking specifically at each category of product newly eligible for quota-free access, the story is similar. Compared with the first six months of 2001, U.S. imports of cotton gloves and mittens through June 2002 were off 12.9%, to $53.9 million, as unit imports fell 5.8%, to 23.5million dozen pairs. However, Chinese shipments to the United States were up 53.9% in dollars, to $15.7million, and an astounding 162.8% in units, to 7.2 million dozen pairs. Similarly, total imports of cotton dressing gowns were off 6.3%, to $127.1 million, while Chinese shipments jumped 225.8%, to $22.0million. Imports classified as "other cotton apparel" a large, motley category ranging from overalls to swimsuits to tights, were off 20.7%, to $499.7million, while Chinese shipments expanded 60.3%, to $146.4million, propelling China into the top spot for this category. As the volume of Chinese imports has grown, the 13 next-largest suppliers, accounting for 59% of imports in the first half of 2002, all saw their shipments to the United States fall from the first six months of 2001, by a combined 37.8% dollar volume. 

For these three apparel categories combined (gloves and mittens, dressing gowns, and other cotton apparel), world shipments to the United States were off 17.8% from the first six months of 2001, to $681 million for the first six months of 2002, while Chinese shipments climbed 70%, to $184 million. For the same period, total world cotton apparel exports to the United States shrank 4.4% in value, to $15.6 billion, and expanded in volume by an anemic 1.5%, to 4.6billion square meter equivalents (SMEs). An expanding unit volume and shrinking dollar volume of imports implies lower cost per unit. For total imports from countries other than China, the price for the first six months of 2002 fell 4.9% from the same period last year, to $3.39 per SME. The surge in Chinese imports has not been limited to the apparel items on which quotas have been removed; over the same period, U.S. imports of all cotton apparel from China jumped 24.8%, to $853million, making China the third-largest foreign supplier of cotton apparel, behind Hong Kong and Mexico. At the same time, on a volume basis, Chinese shipments expanded 66.4%, to 270 million SMEs. With lower total cost of production, the Chinese cost per SME stands at $3.16, lower than the world average, which helps to explain the shift in sourcing.

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The trend for cotton textile trade is similar to that for cotton apparel. Total U.S. imports of cotton textiles in the first six months of 2002 were up 8.7% from the same period last year, to $2.8billion. Driving this gain has been a surge in shipments from China, which rose 45.1%, to $580 million. The primary category of cotton textile products that China supplies to the United States, classified as "miscellaneous textile manufactures," encompasses products from luggage and duffel bags to floor coverings to miscellaneous home textile products not elsewhere classified. The largest foreign supplier of this category to the United States, China saw the value of its shipments for the first six months of 2002 climb 58.4% from the same period last year, to $283 million. For the same period, imports of miscellaneous cotton textile products from the rest of the world increased only 11.6%. As with apparel, the growth in Chinese cotton textile imports has not been limited to products benefiting from the quota phase-out. Excluding miscellaneous cotton home textile products, total U.S. imports of cotton textile products from countries other than China were up 3.1% from the same period last year, to $1.9 billion. Meanwhile, U.S. imports of other cotton home textile products from China climbed 34.4%, to $297 million.

It is interesting to note that U.S. imports of cotton products from China have risen faster than those from the rest of the world in categories not benefiting from the quota phase-out. Many observers attribute this to the declining value of the dollar. As the U.S. economy continued to expand and attract foreign investment during much of the 1990s, the dollar rose to unprecedented levels against several foreign currencies. As the economy has cooled in 2002, the dollar has fallen from its peak against several major currencies, and several primary foreign suppliers of cotton apparel and textiles — Pakistan, Canada, and South Korea—have seen their currencies generally appreciate against the dollar. However, the Chinese currency, the yuan renminbi, is de facto pegged to the dollar via payment of export tax rebates to Chinese exporters. As a result, while the dollar has fallen against several key currencies around the world, so has the yuan, causing imports from major foreign suppliers to appear relatively more expensive than Chinese imports.

The surge in U.S. cotton product imports from China not only is noteworthy in itself, but also has caught the attention of many who believe the trend is a harbinger of trade patterns after January 1, 2005, when bilateral quotas will be removed on all remaining textile and apparel products. The remaining quotas apply to roughly 2,500 textile and apparel classifications, accounting for approximately 49% of all textile and apparel import classifications in 1990. With this year's surge in Chinese shipments, the profile of foreign suppliers to the U.S. market may have taken a dramatic step closer to its post-2004 look.

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