In retaliation to President Trump’s protectionist trade policies, the European Union has levied 25 per cent tariff on US-made denim. This may affect smaller US-based denim companies, many of whom focus on higher-end apparel. Larger businesses such as Levi Strauss may largely escape the impact since most of their products are made overseas and wouldn't be subject to the tariffs, which came into effect in June.
Trade data shows, blue jeans form a tiny part of the US exports. The nation exported jeans worth over $40 million to Canada, its largest market, in 2017. Before trade tensions rose, some US denim companies had been hoping to boost their presence overseas.
The industry had been struggling even before the trade war began. Two major denim mills closed down including Cone Denim's plant in Greensboro, N.C., which was the last American factory to make high-end denim fabric on a large scale. Several factories in Los Angeles had shut down and moved to Mexico after California raised its minimum wage.