One out of every five sweaters globally comes from Dalang, Dongguan, a small town in the Pearl River Delta whose wool knitwear chain has surpassed 72 billion yuan in annual transaction value. Behind these impressive figures, the wool industry is undergoing a systemic restructuring from its foundational logic to its surface-level business models.
Industrial Geography and Data Mirror
As China's core wool knitwear cluster, Dalang produces over 900 million garments annually, with a full-chain transaction value of 72 billion yuan, directly mirroring China's hub status in the global supply chain. The latest data from the China National Textile and Apparel Council (CNTAC) shows that from January to April this year, revenue of textile enterprises above designated size edged down 0.3% year-on-year, but total profit surged 19.3%, with the profit margin recovering to 2.9%. This inverse indicator of 'revenue down, profit up' reveals a shift from scale-driven to efficiency- and value-driven growth.
During the same period, retail sales of clothing, shoes, hats, and knitwear by units above designated size totaled 512.13 billion yuan, up 8.1% year-on-year, accelerating by 5 percentage points from the previous year. The resilience of domestic demand provides a cushion for wool enterprises. However, fixed asset investment shows significant divergence: textile sector investment grew 10.8%, while apparel and chemical fiber sectors fell 10.3% and 14.5% respectively. This suggests capital is flowing into intelligent upgrading of upstream manufacturing rather than simple capacity expansion downstream.
Dual Impact of Technology and Models
The 95th International Wool Textile Conference, themed 'Intelligent Weaving Future: Wool's Health and Digital Life,' precisely anchors two pillars of transformation: digital technology and health consumption. Sun Ruizhe, President of CNTAC, emphasized in his speech that AI is evolving from a tool into an industrial infrastructure. Taking Jiangsu Yueda Textile's 'Lighthouse Factory' as an example, intelligent manufacturing has reduced labor per 10,000 spindles by about 70%, quadrupled total labor productivity, cut unit energy consumption by 15%, and lowered processing costs by 26%. Such efficiency leaps are rewriting the cost structure of wool enterprises.
On the consumer side, social media and AI recommendation algorithms are reshaping how wool products are discovered and purchased. Consumer demands for wool garments have extended from warmth to health attributes and emotional connection. This means wool enterprises must incorporate raw material traceability, green production processes, and cultural narratives in design into their core competitiveness. Dalang's industrial agglomeration advantage provides a testing ground for this full-chain value reconstruction from raw materials to finished garments.
China's Variable in a Global Perspective
China's annual fiber processing volume remains above 60 million tons, and annual garment output exceeds 70 billion pieces, each accounting for over 50% of the global share. Textile exports have exceeded $300 billion for six consecutive years, with intermediate products like chemical fibers and fabrics providing stable support for the global supply chain. In the first five months of this year, total textile and apparel exports reached $116.73 billion, up 0.1% year-on-year, with textile exports rising 1.7% and apparel exports falling 1.6%. This 'fabrics strong, garments weak' export structure reflects China's textile industry transitioning from final assembly to core material supply.
For the wool industry, this means upstream intermediate products like wool tops and yarns will gain more export premium space. However, geopolitical conflicts and shipping volatility require enterprises to build more resilient supply networks. Dalang's industrial ecology—a short-chain response capability from raw material procurement to design sampling to finished garment delivery—is precisely the key asset to cope with such uncertainties.