Apparel Export Hits 60.15% YoY Growth in March 2022

Bangladesh RMG industries growth continues to increase. Apparel export witnessed an astounding 60.15% YoY growth for the month of March 2022 (BGMEA). According to Export Promotion Bureau (EPB) data, Bangladesh’s RMG export was $4.7 billion from July-March 2022. While for July-March 2021 export was $3.08 billion.

Among the total earnings, more than $2.05 billion came from the knitwear sector and the rest of $1.88 billion came from the woven sector.

Bangladesh's total export earnings for March have hit $4.76 billion. March export growth stands at 55% YoY. A major contributor to such growth were garments, home textiles and leather footwear despite the Russia-Ukraine war's effect on global trade.

The total earnings from shipping goods abroad rose 33.4 per cent year-on-year to $38.6 billion in nine months since July of the fiscal year 2021-22, providing much-needed support to the country's foreign exchange reserves.

The Export Promotion Bureau (EPB) data showed that garment exports fetched $31.42 billion in the nine months to the end of March of the fiscal year 2021-22, up 33 per cent from that a year ago. Leading garments exporters credited buyers' order shifts, increasing the price of yarn and raw materials to high export earnings.

Furthermore, buyers are sticking to their bookings and no cancellation was seen due to the war. Garments, comprising woven and knitwear, made up 81 per cent of the overall export receipt of $31.4 billion in the July-March period of the current fiscal year.

The next highest-earning category is home textile with $1.15 billion during July 2021-March 2022 period. This represents 37% YoY growth.

The third highest-earning category belongs to leather and leather products with $896 million in the July-March period of the fiscal year 2021-22. This is 31% YoY growth.

Export growth is a good sign that Bangladesh's export economy is not reliant on Russia. However, the ever-increasing price of raw materials is reducing net profit. To increase profit Bangladesh should move towards high-value products. Another important factor to future growth could be the backward and forward linkage industry. A strong backward and forward industry should help Bangladesh RMG industry to move towards high-value apparel export.

This growth can be attributed to the higher raw material and freight costs as well as increasing orders from Buyers. It also showcases that the Russia-Ukraine war had minimal impact on Bangladesh RMG export despite the EU being a major exporting destination.