U.S. Wool Industry Exploring Opportunities of New U.S. African Growth and Opportunity Act

By Barry Savage, American Wool Council Consultant

Oct. 2003 -- Evidencing a strong, cooperative approach to the current U.S. textile crisis, representatives from the American Sheep Industry Association (ASI) and the National Textile Association (NTA) traveled to South Africa, Mauritius and Madagascar in July 2003 to examine the export potential for U.S. wool and U.S.-produced wool yarn and fabric to textile mills and garment manufacturers in these countries under the new U.S. African Growth and Opportunity Act (AGOA).

The AGOA provides for duty-free entry of garments made of regional or U.S. yarn or fabric. To date, there has been little or no U.S. participation under the Act -- despite the considerable exports of wool knitwear (Mauritius) and wool garments (South Africa) to the United States under the provisions of the Act in 2002.

?There are opportunities for the supply of U.S. wool yarn -- especially fancy yarn -- to the Mauritius knitwear sector to permit an expansion of exports to the United States,? says Barry Savage, who represented ASI on the trip. ?Knitwear is a key market segment for U.S. wool due to the high loft and resistance to recovery characteristics of U.S. wool.?

Although there has been a supply of wool knitwear to the United States from Mauritius in the past, the main market for wool knitwear for Mauritius knitters has been Europe -- due largely to the trade agreement in place between the European Economic Community and Mauritius.

?Now that there is a similar trade agreement with the United States, many knitters would like to broaden their export base by expanding sales to the United States, but they have some restrictions in terms of the volume and type of wool yarn supply available regionally,? adds Savage. ?This provides an opportunity for U.S. wool yarn suppliers.?

Opportunities for U.S. fabric supply to South African woven-garment manufacturers exist as well. In 2002, South Africa was unable to supply the entire demand for men's lambswool jackets from U.S. retailers due to the shortage in AGOA-qualified wool fabric. While the demand has lessened due to the current soft U.S. retail market, signs of an improvement in the U.S. economy could quickly change the situation, ushering in opportunities for U.S. wool fabric suppliers.

Although Madagascar is still recovering from a several political crisis that occurred in 2002, U.S. suppliers should keep a close watch to identify opportunities as that country?s textile production expands.

?The National Textile Association wool-textile manufacturing members will benefit directly from the considerable knowledge we gained on this trip,? says David Trumbull, who represented NTA. ?There are opportunities in these markets, and we will be working with our members to ensure that we take advantage of as many as we can.?

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