Under yarn-forward rules of origin in US FTAs, a knit garment must be made from yarn spun in an FTA partner country to qualify for preferential duty rates. Because knitting mills integrate yarn into fabric and garment in one step, the origin of the input yarn is directly determinative of whether the finished garment qualifies — making yarn sourcing a compliance issue, not just a cost issue.

Full-fashioned knitwear is shaped on the knitting machine itself, producing garment panels or complete garments without significant cutting. Cut-and-sew operations knit fabric in rolls or panels and then cut and assemble garments. For HTS classification purposes, both result in Chapter 61 garments, but the production method affects value-added calculations relevant to rules-of-origin determinations.