Publication Number: 3719

Report Title: U.S.-Market Conditions for Certain Wool Articles

Investigation Number: 332-449

Author's name(s): Jackie Jones

Date Published: September 2004

Report Description/Introductory Text: Following receipt of a request from the United States Trade Representative (USTR) on December 30, 2002, the U.S. International Trade Commission instituted investigation No. 332-449, U.S. Market Conditions for Certain Wool Articles in 2002-04, under section 332(g) of the Tariff Act of 1930 (19 U.S.C. 1332(g)) on January 24, 2003. As requested by USTR, the Commission, in this second and final report, is providing information for 2003 and first quarter 2004 on U.S. market conditions, including domestic demand, supply, and production for men’s and boys’ worsted wool suits, suit-type jackets, and trousers; worsted wool fabrics and yarns used in the manufacture of such clothing; and wool fibers used in the manufacture of such fabrics and yarn.

U.S. demand for men’s and boys’ worsted wool tailored clothing showed signs of improvement in the latter half of 2003 and first quarter of 2004. The increased demand was concentrated in fine-micron tailored clothing, reflecting a shift in consumer tastes to higher end fabrics. U.S. production of the tailored clothing declined during 2001-03 and imports increased, continuing to supply most of the tailored clothing market. The Commission estimated that the U.S. market for worsted wool fabrics used in the production of men’s tailored clothing in the United States decreased from 2002 to 2003, reflecting the decline in domestic production of men’s tailored clothing. Many U.S. tailored clothing manufacturers purchase domestic worsted wool fabrics for offshore production, particularly in Mexico, Colombia, and Caribbean Basin countries, as these countries benefit from competitive labor costs, proximity to the United States, and duty-free access under preferential trade agreements. U.S. tailored clothing manufacturers contend that style, quality, value, small lot sizes, and delivery times are the most competitive factors in the U.S. market. Consequently, the clothing manufacturers are unlikely to increase purchasing from domestic fabric suppliers and are likely to continue to purchase a diversity of fabrics from different mills worldwide.

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