All major sectors except RMG suffer export drop in Jul-Apr
Two major sectors -- garments, leather and leather products -- had recorded growth in export until March of the current fiscal year 2022-23 while other major sectors suffered a downturn.
But with the April export earnings data becoming available, leather and leather makers joined the group of other major sectors that had been registering decline in exports in the current fiscal year.
Now, garment is the only industry among major export sectors that has been able to retain growth in earnings. However, Mohiuddin Rubel, director of the Bangladesh Garment Manufacturers and Exporters Association, said a detailed inspection of single-month statistics reveals a recent decline in apparel export growth.
In April, garment exports fell 15.4 per cent year-on-year to $3.32 billion.
"The amalgamation of these declines contributed to the overall descending trend in recent months, which stands in contrast to the otherwise positive trajectory for the mentioned period in fiscal 2022-23," he added.
Garment exports rose 9 per cent to $38.57 billion during the period, data from the Export Promotion Bureau (EPB) showed.
And based on the growth of apparel exports, Bangladesh's overall export receipts grew 5.38 per cent year-on-year to $45.67 billion in the July-April period of the current fiscal from $43.3 billion the year before while other major sectors recorded a drop.
Export earnings from leather and leather goods dropped 0.52 per cent year-on-year to $1 billion in the July-April period as shipments leather footwear, the main earning sub-sector, fell 4.3 per cent during the period.
Md Saiful Islam, president of the Metropolitan Chamber of Commerce and Industry (MCCI), said high inflation in the western market, particularly in Europe, the main market for Bangladesh's exports, reduced the buying capacity of consumers.
"Leather products and footwear are not essential items. Consumers are cutting back on their expenses. They are tightening their belts," he added.
Islam then said inventories of importers who bought goods to meet the pent-up demand after the easing of coronavirus restrictions are yet exhausted, which has kept their appetite for new products low.
Besides, manufacturing costs have increased for price hikes for electricity, gas and other costs but buyers are not willing to pay higher prices, added Islam, also managing director of Picard Bangladesh Ltd, a leading leather goods exporter.
Apart from leather, export earnings from frozen and live fish declined 20 per cent to $371 million in the July-April period of the current fiscal compared to the same months of the year prior.
This is mainly because of a slump in shipments of shrimp amid declining demand for locally grown black tiger shrimp and a fall in prices in the international market in the face of oversupply of white-leg shrimp, also called vannamei, exporters said earlier.
Agricultural product exports dipped 29 per cent year-on-year to $741 million in the first 10 months of the fiscal year, according to EPB data.
Including fresh vegetable and fruits, shipments of all major products, except tobacco and spices, plummeted.
Debasish Singha, head of business (export) at Danish Foods Ltd, owned by Partex Star Group, said locally made dry foods have become uncompetitive with competing countries in the export market because of the increased cost of raw materials and higher utility cost.
"We are failing to compete," he said, adding that the increased cost for imported goods offset the gains they had for the depreciation of taka against dollar.
In case of jute and jute goods, earnings fell 20 per cent to $770 million in July-April of the current fiscal year from $966 million a year ago, showed EPB data.
The global economic slowdown, shrinking demand for the main export item jute yarn from carpet makers in countries including the main buyer Turkey, and the persisting anti-dumping duty imposed by India continued to keep exports lower, industry operators said earlier.
Looking ahead, Islam said it will be difficult to have sustainable growth in overall exports this fiscal year, ending on June 30, 2023.
"If it continues, we may not achieve the export growth target this fiscal year," he added.
Bangladesh aims to fetch $58 billion through exports during the current fiscal year.
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