CHINA: TEXTILES & APPAREL: First round of Safeguards!
Washington has made it's move, imposing safeguards on the three major Chinese textile imports: cotton trousers, cotton knit tops, and cotton/mmf underwear (mmf=man-made fiber). The exact amount has not been decided yet, but irregardless the message is clear. US protectionism is mounting.
The three categories initially targeted comprise roughly 40% of US apparel imports and there are another subsequent 9 categories now under petition which round out another 17% of US apparel imports. Which means, that the US is pretty much looking to limit China's upside potential in about 60% of the US market.
China's market share in the three categories now targeted for safeguards are roughly: cotton trousers - 15.0%, cotton knit tops - 7.5%, and cotton/mmf underwear - 9.0%.
Implications:
Downstream participants will be hardest hit.
Still remain upbeat on Weiqiao, since they have a geographically well diversified production base, and solid domestic sales.
India looks to be the biggest winner, as they will face restricted competition allowing for market share gain.
The measures are not final, as no official quota numbers are out. If the market prices in official quota numbers, and Beijing and Washington can find a mutual arrangement without quotas, then there is upside risk. The reverse would apply in playing for downside risks.
The three categories initially targeted comprise roughly 40% of US apparel imports and there are another subsequent 9 categories now under petition which round out another 17% of US apparel imports. Which means, that the US is pretty much looking to limit China's upside potential in about 60% of the US market.
China's market share in the three categories now targeted for safeguards are roughly: cotton trousers - 15.0%, cotton knit tops - 7.5%, and cotton/mmf underwear - 9.0%.
Implications:
Downstream participants will be hardest hit.
Still remain upbeat on Weiqiao, since they have a geographically well diversified production base, and solid domestic sales.
India looks to be the biggest winner, as they will face restricted competition allowing for market share gain.
The measures are not final, as no official quota numbers are out. If the market prices in official quota numbers, and Beijing and Washington can find a mutual arrangement without quotas, then there is upside risk. The reverse would apply in playing for downside risks.
posted by howa at
5/14/2005
