Fashion Intel & Analysis

U.S. Customs and Border Protection has released the 2019 schedule of 35 educational webinars, each focused on specific commodity topics and hosted by the National Commodity Specialist Division. The full schedule is available here. Registration links can be found below. Once you sign up for a specific month, you will have access to all of the webinars held that month.

June 2019 NCSD Webinars Training Schedule
Registration
 
July 2019 NCSD Webinars Training Schedule
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August 2019 NCSD Webinars Training Schedule
Registration

Tonight, President Trump released a statement threatening 5% tariffs on all goods imported from Mexico if the flow of illegal immigration to the U.S. does not stop. The tariffs would be effective June 10 and increase by 5% on the first day of each month, starting July 1. “As President of the United States, my highest duty is the defense of the country and its citizens.  A nation without borders is not a nation at all.  I will not stand by and allow our sovereignty to be eroded, our laws to be trampled, or our borders to be disrespected anymore,” says Trump. 

Though there has been a significant decrease in cargo wait times at the Southern Border, there are still challenges.  During Thursday's update, CBP's Executive Director for Cargo and Conveyance Security, Tom Overacker, said there remain problems especially in Hidalgo/Pharr, El Paso, and Otay Mesa.  CBP continues all efforts to reduce wait times, keep commercial truck lanes open, and facilitate trade in the most effective ways possible. As a reminder, there are currently 245 officers from Southwest border ports and 486 officers from northern borders, airports, and seaports assisting with border patrol. In addition to the 731 officers there have been 172 volunteers from the Department of Homeland Security Surge Capacity Force cleared to assist Border Patrol.

Overacker also addressed how the redeployment of officers is impacting other parts of operation, a topic that came up during CBP’s Congressional testimony on the situation at the southern border last week. Owen noted the decline in enforcement actions at the port of entry, an impact CBP is concerned with and analyzing carefully. 

While we cannot predict what the Trump Administration may do, we are in the middle of a major battle over the imposition of additional tariffs on all imports from China.  Many members have asked, what can we do?   So we want to share some recommendations about what you can do.  There are no guarantees that we will be successful.  But it is more important than ever for the Trump Administration to hear from all of us.   Please feel free to call or email if you have any questions.  We will send more updates whenever we have new information.  

Thanks for your engagement and I look forward to talking with you, Julie

Share Your Company’s Views
There are a number of ways that companies  can make your voice known.  

  1. Join with other companies and sign a letter to The President.  USFIA is joining with Americans for Free Trade, a broad coalition of industry groups, to send a letter to the President in opposition to these tariffs.   We will be circulating this letter to all USFIA members and we encourage you to sign on.   Watch your email in the next few days for this request.  

  2. File comments as part of the 301 Committee review of the list of products proposed for additional tariffs.  Some USFIA members filed comments already on different products covered by the tariffs on China.  But for those of you who have not, this is a relatively easy process to make your voice known.   If you are not sure where to start, send us an email and we will share some examples from past hearings.   

  3. Come to Washington and testify at the hearing in June.  USFIA plans to testify at the hearing, and we encourage member companies to join us.  We know that the testimony at the hearing can have an impact on the Administration’s decisions.   They are interested to hear compelling stories about the impact on your business and on your customers, the alternatives to China, and of course the jobs affected by higher tariffs.   The hearing is expected to last for as long as two weeks, but each person who appears will have just five minutes to share their views, and then answer questions from the inter-agency 301 Committee.  USFIA and our Washington Counsel David Spooner can share some guidance with you if you are interested to appear. 

  4. Start Preparing for Filing Exclusion Requests.  USTR has finally published the Federal Register notice with the details about the Exclusion process for List 3.  USTR estimates they expect 60,000 Exclusion requests for the List 3 products. Several USFIA members have expressed interest in pursuing Exclusions.  While the Exclusion process has not worked quickly, or approved a high percentage of products, it does remain an important option if the China tariffs remain in place for an extended period of time.   


Share Your Insights with USFIA
We also are asking for your help as USFIA prepares our statement.   While of course in our comments we will continue to strongly make the case that the 301 tariffs should not be placed on any consumer products, we do want to gather information from member companies to help us make the case.  All this information will be kept confidential and no companies will be identified in the USFIA statement (unless you want your name on the record).  

Following are four key areas where we would appreciate your information: 

  • Key products of concern for members.  There are two ways we are approaching this question.  First, we recognize that there are a number of products where it is particularly difficult to source outside China.  Some of these products include Sweaters, Outerwear, Swimwear and Childrenswear.  Similarly, the production of Silk and Cashmere products are centralized in China. 

    We also are very interested in those products that are your top imports from China (the top 10 or 20 HTS lines) as well as those products that are high priority because a very high percentage of imports come from China.  We will keep this information confidential and whatever you can share will improve the impact of our statement. 

  • Insights about how long it takes to move production.  While of course this answer will vary from company to company, we think it would be valuable to prepare a timeline that shows USTR how long it actually takes to shift sourcing options.  We would especially like to hear your views about the impact of social compliance and sustainability requirements on these options.   

  • Information on projections for lost sales and job losses.  We know this is very sensitive information.  But we believe that some USFIA members have already prepared their internal analysis about how the increase in prices from a 25% tariff will affect sales.  If it is possible for us to generalize about the impact on sales and jobs, that would be very valuable information to provide to the Administration.  Our assumption is that sales will be projected to be lower with higher prices.  So if we can make some generalizations (based on what you actually anticipate would happen) that would be a very strong case.  

  • Data about supply chain disruptions and logistics due to the pressure on quality manufacturers outside China.  We have heard a few members talk about this impact on delivery and price.  This would be another interesting issue to address in USFIA’s statement, but we will need more details.

This week in Apparel Magazine, Dr. Sheng Lu, associate professor in the Department of Fashion and Apparel Stories at the University of Delaware, takes a fresh look at shifting sourcing trends.  In an article called, "How the Tariff War Is Shifting "Made in China" Sourcing Strategy for U.S. Apparel Retailers,"  he finds that the data confirms more diversification to mitigate the risk of a trade war with China.   Click here to read Dr. Lu’s key findings and analysis.