Dec 20, 2024 (MarketLine via COMTEX) --
Peru's alpaca textile and apparel sector is trying to increase formal exports to the US despite some trading problems undermining its position.
PeruaEUR(TM)s minister of foreign trade and tourism, Asrsula DesilA LeAn ChempA(C)n promoted sales at garment fairs Sourcing at Magic New York and Coterie New York, in September 2024, stressing Peruvian fabricaEUR(TM)s aEURoewide range of materials that are of excellent quality, high durability, and sustainableaEUR and promising to aEURoecontinue strengtheningaEUR the industry.
Peru eyes $1m worth of apparel exports The goal, according to the minister, was to win Peru contracts of at least $1m for apparel manufacturing and exports of alpaca, Peruvian cotton and other local inputs.
PeruaEUR(TM)s well-established textile tradition has generatedAdemandAforAdesigners and brands making garments in the country, creatingAaround 400,000 jobs in the industry. This is against a background of alpaca wool remaining popular.
From November 2023 until October 2024, Peru's textile and garment sector exported $1.6bnaEUR(TM)s worth of product with 51% of it going to the US, according to the ministry of foreign trade and tourism data.
In 2023, exports of alpaca garments, fibre, combed fibre, yarns, fabrics and home textiles alone reached $214m, up 14.5% since 2022, said Peru's Export and Tourism Promotion Agency (Promperu) with data passed to Just Style.
Yarn exports are increasing fast driven by more orders from the US (+40.4%) over the same timescale, said Promperu.
Daniel ArA(C)stegui, manager of the Peru-based International Alpaca Association (IAA), said this trade was promoted by $50,000 of sales of alpaca wool products sold annually at PeruaEUR(TM)s tourist centres and airports with alpaca clothing purchased as a aEURoeluxury souveniraEUR.
Concerns over unprocessed fibre being smuggled to Bolivia However, he warned there are dark clouds facing the industry. There are significant black or grey market sales, said ArA(C)stegui as over the last five years unwashed unprocessed fibre has been smuggled to Bolivia.
And while overall export sales are increasing, there are signs of weakness, with aEURoesome important clientsaEURno longer asking for alpacaaEUR. ArA(C)stegui warned of some rates of aEURoehigh returnsaEUR of products with clients, for instance, returning expensive alpaca coats after wearing them, which aEURoegenerates an extra costaEUR for companies.
Indeed, there is concern about weakness in overseas sales of value-added products in the alpaca segment compared to purchases of raw materials.A A
ArA(C)stegui added that significant volumes of combed fibre are exported to China, which then aEURoereturns the product competing in the United States and in Europe with its cheap productsaEUR.
Trump poses Peru tariff threat There is also concern about the election of Donald Trump as US President with his threats of imposing tariffs, which could harm Peruvian export sales, which since 2009 have largely been absent under the United States-Peru Free Trade Agreement.A A
Claudia Cordero Berkovic, co-founder and regional manager of global operations for alpaca garments manufacturer and exporter Lima-based Peruvian Traditions said: aEURoeThere is a fear, of course. Hopefully [the tariffs will be] for other types of products that the US national companies want to protect and not so much for specific products of another kind, such as Peruvian products,aEUR she told Just Style.
Her company receives around 40% of its export sales from the US, 40% from Canada and 10% from Germany, so any loss of sales in the US would be important, especially as the company regards exporting to the US and Canada as involving less trade bureaucracy than to the European Union. The company sells around 1,600 alpaca clothing products annually, many for other brands. One specialist line is selling products made of Peruvian TangA 1/4is cotton, combined with baby alpaca wool, which yields solid US sales. The companyaEUR(TM)s overseas sales benefit from fair trade certification and being supported by Promperu.
Earlier this year Peru's apparel and textile industry said it was hoping for a strong 2024 after emerging from past political unrest and economic downturns.
http://www.datamonitor.com
Republication or redistribution, including by framing or similar means,
is expressly prohibited without prior written consent. Datamonitor shall
not be liable for errors or delays in the content, or for any actions
taken in reliance thereon
COMTEX_461059457/2227/2024-12-20T09:50:07
Copyright (C) 2024 Datamonitor. All rights reserved
