Cotton Product Sourcing Situation and Outlook: Cotton Apparel Orders Down in the Western Hemisphere

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Nº 2 AUGUST 2013, YEAR 14 Cotton Product Sourcing Situation and Outlook: Cotton Apparel Orders Down in the Western Hemisphere Review of U.S. Imports January May 2013 International Development Systems Overall U.

Twelve of the top twenty U.S. suppliers of cotton apparel products grew during the first five months of 2013.

Cotton shipments from fourth-ranked Honduras, seventh-ranked El Salvador, tenth-ranked Mexico, twenty-first -ranked Peru, and twenty-fifth-ranked Costa Rica are down

Rapid price increases affected the competitiveness of cotton. From January to May, 2013 the U.S. imported 4,984.3 million SME of cotton apparel products.

1 Nº 2 AUGUST 2013, YEAR 14 Cotton Product Sourcing Situation and Outlook: Cotton Apparel Orders Down in the Western Hemisphere Review of U.S. Imports January May 2013 International Development Systems Overall U.S. apparel imports are up six percent by quantity and three percent by value. During the first five months of 2013, U.S. cotton apparel shipments are up by both quantity and value compared to the first five months of Twelve of the top twenty U.S. suppliers of cotton apparel products grew during the first five months of Overall, Western Hemisphere countries are performing worse than the total U.S. imports despite double-digit growth from seventeenth -ranked Dominican Republic. Cotton shipments from fourth-ranked Honduras, seventh-ranked El Salvador, tenth-ranked Mexico, twenty-first -ranked Peru, and twenty-fifth-ranked Costa Rica are down compared to the first five months of The volatility in the price of cotton remains an area of concern. Rapid price increases affected the competitiveness of cotton. From January to May, 2013 the U.S. imported 4,984.3 million SME of cotton apparel products. This is up three percent compared the same period one year ago. However, U.S. imports man-made fiber apparel is up ten percent, from 4,008.2 million SME to 4,443.0 million SME during the same period. 1

With the increase in the relative price of cotton apparel, the market share of U.S. cotton apparel imports decreased two percent, from fifty-three percent to fifty-one percent.

Following is a list of the top twenty suppliers of cotton apparel to the U.S. during the first five months of 2013, along with the growth rate from January through May 2013. China remains the top U.S. supplier of cotton apparel imports, even though imports from China grew by three percent.

2 With the increase in the relative price of cotton apparel, the market share of U.S. cotton apparel imports decreased two percent, from fifty-three percent to fifty-one percent. During this same period, the market share of U.S. man-made fiber apparel imports increased by two percent, from forty-four percent to forty-six percent. Following is a list of the top twenty suppliers of cotton apparel to the U.S. during the first five months of 2013, along with the growth rate from January through May China remains the top U.S. supplier of cotton apparel imports, even though imports from China grew by three percent. Cotton Apparel Imports for Year-To-Date May 2013 (By Quantity) Country Market Share Growth 1 China 28.62% 3.88% 2 Bangladesh 11.28% 10.99% 3 Vietnam 9.95% 12.37% 4 Honduras 5.18% -3.53% 5 Indonesia 6.05% 6.68% 6 India 6.07% -2.35% 7 El Salvador 4.03% -6.34% 8 Camboya 4.27% -0.95% 9 Pakistán 3.95% 1.14% 10 México 4.02% -4.96% 11 Nicaragua 2.06% 2.55% 12 Haití 1.81% 25.53% 13 Sri Lanka 1.88% 12.95% 14 Tailandia 1.55% -0.26% 15 Las Filipinas 1.67% 14.70% 16 Guatemala 1.48% 8.19% 17 República Dominicana 1.10% 39.83% 18 Egipto 0.86% % 19 Malaysia 0.64% 20.87% 20 Costa Rica 0.28% % 2

Major U.S. Apparel Imports from Western Hemisphere Suppliers Western Hemisphere countries continue to be a major source for U.S. imports of cotton apparel.

Despite its decrease in overall cotton apparel production, Western Hemisphere production of Cotton Knit Tops, Cotton Trousers and Shorts,

Cotton Knit Tops (category 338/339) U.S. total imports from January through May 2013: 157,343,775 dozen or 1.8 billion knit tops 1. China 2.

3 Major U.S. Apparel Imports from Western Hemisphere Suppliers Western Hemisphere countries continue to be a major source for U.S. imports of cotton apparel. The Western Hemisphere supply chain remains a successful competitive strategy for making cotton apparel. Despite its decrease in overall cotton apparel production, Western Hemisphere production of Cotton Knit Tops, Cotton Trousers and Shorts, and Cotton Underwear increased compared to one year ago. Following is a review of the most important cotton apparel imports. Cotton Knit Tops (category 338/339) U.S. total imports from January through May 2013: 157,343,775 dozen or 1.8 billion knit tops 1. China 2. Vietnam 3. Honduras 4. Indonesia 5. Nicaragua 6. Haiti 7. Guatemala 8. Mexico 9. India 10. Cambodia 11. El Salvador 12. Bangladesh 13. Pakistan 14. Dominican Republic 15. Peru 3

Cotton Trousers and Shorts (category 347/348) U.S. total imports from January through May 2013: 83,835,087 dozen or 1.0 billion pairs of trousers 1. China 2.

Philippines Cotton Underwear (Category 352) U.S. total imports from January through May 2013: 81,555,209 dozen or 1.0 billion pairs of underwear 1. Vietnam 2.

4 Cotton Trousers and Shorts (category 347/348) U.S. total imports from January through May 2013: 83,835,087 dozen or 1.0 billion pairs of trousers 1. China 2. Bangladesh 3. Vietnam 4. Indonesia 5. Mexico 6. Cambodia 7. Pakistan 8. India 9. Egypt 10. Nicaragua 11. Sri Lanka 12. Jordan 13. Honduras 14. Kenya 15. Philippines Cotton Underwear (Category 352) U.S. total imports from January through May 2013: 81,555,209 dozen or 1.0 billion pairs of underwear 1. Vietnam 2. Honduras 3. El Salvador 4. Bangladesh 5. China 6. India 7. Thailand 8. Dominican Republic 9. Haiti 10. Philippines 11. Sri Lanka 12. Cambodia 13. Pakistan 14. Costa Rica 15. Mexico 4

Central Textiles/ Cotswold Industries 237 Mills Avenue Central, SC 29630 Phone: (212) 689-3432 Fax: (212) 545-0603 www.cotswoldindustries.

5 Central Textiles/ Cotswold Industries 237 Mills Avenue Central, SC Phone: (212) Fax: (212) Contact name/number: James McKinnon, CEO Phone: Bill Broadway, President List of Senior Management: James McKinnon, CEO Bill Broadway, President History of Company: Founded in 1954 and now in its third generation of family management, Cotswold is a leader in the development and distribution of technical textiles and apparel fabrics. As a vertically integrated manufacturer, converter and distributor, Cotswold brings its customers quality and value from fiber to a finished product. Central Textiles manufactures cotton and polyester blended fabrics for apparel, military, home furnshings and industrial applications. The facility is fully vertical and processes fiber from yarn spinning to airjet weaving. Products: Cotton Woven Fabrics (basket weave, broadcloth, chambray, herringbone, muslin, poplin, printcloth, sateen, sheeting, shirting-broadcloth, shirting-oxford, special purpose fabrics, twill, customized fabrics) 5

Contempora Fabrics 351 Contempora Drive Lumberton, North Carolina 28358 Phone: (910) 738-7131 Fax: (910) 738-9575 www.contemporafabrics.

6 Contempora Fabrics 351 Contempora Drive Lumberton, North Carolina Phone: (910) Fax: (910) Contact name/number: Ronald Roach, President Phone: (910) ext 218 Cell: (910) Alex Whitley, Director of Sales Phone: (910) ext 210 Cell: (910) List of senior management: Ronald Roach, President Carey Read, VP Finance Danny Church, VP Manufacturing Alex Whitley, Director of Sales History of company: Contempora Fabrics, Inc was founded in 1972 by Lacy Nance. In 1988, the company became a 100% employee owned company. Each employee has a vested interest in the company. The entire management team has over 150 years of combined textile experience. Contempora has 185 circular knitting machines in a 150,000 square foot facility on 29 acres. We are known for our versatile product mix and capacity to produce two million pounds per month. Relationships with fabric converters, manufacturers, major brands, and retailers have helped keep our business viable in a changing textile market. The ability to do contract work, greige goods, or finished fabric has allowed Contempora to work on all levels to meet the various needs required by the customer. Research and development are a priority to help keep our customers aware of the latest trends. Relationships with most major fiber suppliers allow us to be first to market in most cases with the latest technologies. A recent expansion into body size jersey and 3 end fleece machines helped us round out our versatility. Machines include: Rib machines 10, 14, and 18 cut. Double knit machines 14, 18, 20, 22, 24, 28, 32 cut. 26 single knit machines 12, 14, 18, 20, 22, 24, 28 cut. 30 single knit machines 14, 16, 17, 18, 20, 22, 24, 28, 36 cut. 26 terry machines 16, 18, 20 cut end fleece machines 13, 14, 18 cut. Body size jersey machines all sizes 22 and 28 cut. Products: Circular knits including body size jersey, jersey, rib, 2 end fleece, 3 end fleece, pique with collars and welts, thermals, French terry, terry, performance fabrics, and other novelties. All fabrics with and without spandex. End Uses: T-shirts, sportswear, dresses, juniors, golf apparel, career uniform apparel, military, performance apparel, base layer underwear, team sports. 6

Frontier Spinning Mills, Inc. 1823 Boone Trail Road Sanford, NC 27330 Phone: (919) 776 9940 Fax: (919) 718 2300 www.frontierspinning.com Contact name/number: John W.

7 Frontier Spinning Mills, Inc Boone Trail Road Sanford, NC Phone: (919) Fax: (919) Contact name/number: John W. Garris III, Director, International Sales Phone: (919) Fax: (919) List of senior management: John Bakane, CEO Robin Perkins, President George W. Parker, President-Frontier Marketing Barbara F. Walton, CFO John M. Maness, V.P. of Manufacturing History of company: Frontier Spinning Mills, Inc. Frontier Spinning Mills is a privately owned company operating seven manufacturing sites in three different states. With a weekly production of approximately 10 million pounds per week it ranks as one of the largest yarn spinners in the U.S.A. Frontier's diversified core product offerings include Carded Open End, MJS and MVS in wide variety of yarn counts and blends. Frontier's quality begins with the selection of cotton and fiber that is chosen to achieve the best possible results for our customer's processes and end uses. This raw material is then processed in facilities that are equipped with the most current generation of spinning available and interfaced with state-of-the-art automation and robotics. This technology is constantly monitored by highly skilled and well trained technicians thus producing the world's finest spun yarns. Logistically, Frontier's manufacturing facilities are located within easy and convenient travel to major highways and ports to ensure efficient and cost effective transportation. With access to a variety of East Coast ports and sailing schedules, this proximity allows customers to respond quickly to fashion trends and market demands. Frontier recognizes that its investment in customer satisfaction would not be complete with technology alone. Frontier's staff of dedicated associates focuses on bringing customer service and customer satisfaction to levels unequaled in the industry. Our Customer Service representatives recognize that today's competitive environment demands quick responses to inquiries and delivery schedule requests. We are confident that our service is just as exceptional as the yarns we produce. Frontier's commitment to excellence is easy to recognize! Products: 100% cotton Open-End yarns 4/1 to 32/1 100% cotton Soft Spun yarns 4/1 to 30/1 100% cotton Ring Spun yarns 5/1 to 16/1 Organic cotton yarns - Open-End 6/1 to 30/1 Poly cotton yarns 6/1 to 39/1 100% cotton Ring spun and Open-End Slub yarns MJS yarns 12/1 to 50/1 MVS yarns 26/1-30/1 Heather yarns 4/1 to 30/1 End Products Supplied: Circular Knitting Yarns Weaving Twist - (warp & weft) Hosiery Yarns Heather Yarns Air Jet Yarns Medical & Industrial Yarns 7

Hamrick Mills, Inc. P.O. Box 48 515 W. Buford Street Gaffney, SC 29342 Phone: (864) 489-4731 Fax: (864) 487-9946 www.hamrickmills.

8 Hamrick Mills, Inc. P.O. Box W. Buford Street Gaffney, SC Phone: (864) Fax: (864) Contact name/numbers: Jim Hopkins, Vice President, Sales Roy Lockett,Vice President, Sales List of senior management: W. Carlisle Hamrick, President Charles Hamrick, CFO Lyman Hamrick, Vice President, Manufacturing Roy Lockett, Vice President, Sales Jim Hopkins, Vice President, Sales History of Company: Hamrick Mills, Inc. is a fifth generation family-owned textile company. The corporate office and two manufacturing facilities, the Hamrick Plant and the Musgrove Plant, are all located in Gaffney, South Carolina. The company is a leading producer of high quality, light to medium weight woven fabrics for use in the home furnishings, industrial, and apparel markets. Hamrick Mills' mission is to serve customers by focusing on quality, innovation and superior service. Hamrick Mills will also strive to continually improve the operations of our company by implementation of technology or processes that increase customer satisfaction and add value to their products. Products: Woven fabrics in a variety of widths, ranging from 41" to 140" and weights from 2 oz per square yard to 6 oz per square yard. These fabrics are offered in a range poly/cotton blends, as well as 100% cotton. Constructions are mainly plain weave with some dobby capacity available. Various types of filling yarns can be easily run with the company's modern Sulzer projectile and AirJet looms. Yarn is spun on Murata Jet Spinning and Murata Vortex Spinning, in the range of 20's to 40's (Ne) English yarn count. The company offers many common print cloth styles and has the ability to weave special fabric constructions for specific customer needs. End Products Supplied: Shirting fabric Pocketing, waistband lining, innerlining fabric Coating Substrates for Athletic tapes, book bindings, industrial aprons Sheeting fabric Drapery and lining fabric High pressure laminated fabric for printed circuitry 8

2013 U.S. Crop Outlook Prepared by: Economic Services - National Cotton Council The U.S. Department of Agriculture (USDA) released their first U.S. crop outlook for the upcoming season.

9 2013 U.S. Crop Outlook Prepared by: Economic Services - National Cotton Council The U.S. Department of Agriculture (USDA) released their first U.S. crop outlook for the upcoming season. USDA placed the estimated 2013/14 U.S. cotton plantings at million acres, down 16.8% from Upland planted area is estimated to have decreased 17% to million acres. Extra long staple producers planted 226,000 acres, down 5.2% from '12. USDA s June projection is up 225,000 acres from their initial '13 estimate released in March. 9

2013 U.S. Cotton Plantings 2012 Actual (Thou.) 1/ 2013 Estimated (Thou.) 1/ Percent Change SOUTHEAST 2,748 2,525-8.1% Alabama 380 330-13.2% Florida 108 125 15.7% Georgia 1,290 1,300 0.8% N.

10 2013 U.S. Cotton Plantings 2012 Actual (Thou.) 1/ 2013 Estimated (Thou.) 1/ Percent Change SOUTHEAST 2,748 2, % Alabama % Florida % Georgia 1,290 1, % N. Carolina % S. Carolina % Virginia % MID-SOUTH 2,030 1, % Arkansas % Louisiana % Mississippi % Missouri % Tennessee % SOUTHWEST 6,911 5, % Kansas % Oklahoma % Texas 6,550 5, % WEST % Arizona % California % New Mexico % TOTAL UPLAND 12,076 10, % TOTAL ELS % Arizona % California % New Mexico % Texas % ALL COTTON 12,314 10, % 1/ USDA-NASS 10

12 COTTON COUNCIL INTERNATIONAL HEADQUARTERS & LATIN AMERICA 1521 New Hampshire Avenue, NW Washington, DC 20036, USA Phone: (202) Fax: (202) Vaughn Jordan, International Program Director CBI OFFICE: C.C. Plaza Colonial Oficina 1-11A, San Rafael de Escazú, San José, Costa Rica Phone: (506) / Fax: (506) Floribeth González-Schuyler Regional Manager,México, Central America & The Caribbean floribeth@cotton-cr.com ANDEAN OFFICE: Cra. 14 No. 94A-44 Office 402 Bogota, Colombia Phone: (57) Fax: (57) COTTON INCORPORATED HEAD OFFICE 6399 Weston Parkway Cary, NC 27513, USA Phone: (919) Fax: (919) LATIN AMERICA OFFICE: Av. Insurgentes Sur C Mexico, DF, Mexico Phone: (52-55) Fax: (52-55) Jaime Flores Director, Supply Chain Marketing Latin America Global Account Management Group jflores@cottoninc.com Nina Maldonado, Regional Manager, Andean Region nina@cottonusaandean.com KOREAN OFFICE: Leema Building, Suite 303, Soosong-Dong, Chongro-Ku Seoul , Korea Phone: ( ) /2 Fax: ( ) Won-Jung Choi, Program Manager wchoi@cotton.org

Centers for Excellence and Expertise; CBP s Plan to Change Its Relationships with Importers

Nº 1 APRIL 2013, YEAR 14 Centers for Excellence and Expertise; CBP s Plan to Change Its Relationships with Importers Jon Fee and BJ Shannon Alston & Bird LLP April 8, 2013 U.S. Customs and Border Protection