The U.S. textile industry is struggling with a new credit crisis that is undermining billions of dollars in exports to the Western Hemisphere, its top market.

The industry has faced a long-term credit crisis for more than a decade, but the situation has worsened with the economic downturn and bank failures and bailouts in the U.S.

The volume of U.S. textile exports to the region—most to Mexico and Central America—has declined 24 percent since last year because it is harder than ever to obtain financing credit and guarantees, industry representatives said.

The National Council of Textile Organizations and several of its member textile firms in the Carolinas, including Mount Vernon Mills, Parkdale Mills, and Tuscarora Yarns, along with the National Cotton Council of America are lobbying to secure more financing and seeking help from Congress.

Cass Johnson, president of NCTO, said in recent testimony before a House committee that U.S. government institutions, banks, and insurers have withdrawn credit from the $25 billion Western Hemisphere textile and apparel trade sector. More U.S. lenders are refusing to accept foreign accounts receivable as collateral, Johnson told lawmakers.

In addition, U.S. apparel manufacturers and other textile mill customers have started asking mills to extend longer credit terms, sometimes as much as 150 days, and to do so without U.S. Export-Import Bank insurance coverage, factoring, or private credit coverage.

“One can easily understand that smaller and midsize mills have been driven to the brink of failure,” Johnson said.

NCTO is recommending that the House Small Business Committee change a Small Business Administration loan program that provides export financing to small businesses to make the initiative more readily available to small and medium-size manufacturers.

The House passed a bill in October increasing the size of the SBA loans to $5 million, considered a good first step by the textile industry, but the bill has stalled in the Senate, which is bogged down in negotiations over health care legislation.

The issue has gotten the attention of Obama administration trade officials with jurisdiction over some aspects of textile and apparel trade issues. Gail Strickler, assistant U.S. Trade Representative for the office of textiles, has been helping to lead the effort.

“We are working with the Ex-Im Bank [Export Import Bank of the U.S.] to explore financing options for DR-CAFTA countries and Haiti, to enable the full package sourcing brands and retailers require,” a USTR spokeswoman said. “Both agencies want to help U.S. textile and yarn manufactures.”