One out of every five sweaters worldwide comes from Dalang, Dongguan. This wool knitting town produces over 900 million garments annually, with the entire industrial chain generating a transaction value exceeding 72 billion RMB. These figures are not just a local industrial report card; they are a microcosm of the deep integration within the global wool supply chain. At the 95th International Wool Textile Conference, Sun Ruizhe, President of the China National Textile and Apparel Council (CNTAC), delivered a speech that read more like an industry diagnostic: the global textile industry stands at the crossroads of a dual paradigm shift towards the intelligence economy and the experience economy, while Chinese manufacturing is transitioning from scale advantage to systemic competitiveness.
Data Behind Industrial Resilience
China's textile industry financial data for the first four months of the year reveals a structural divergence. Revenue of enterprises above designated size fell 0.3% year-on-year, but total profit surged 19.3%, with a profit margin of 2.9%. This suggests the industry is not surviving on low-price, high-volume strategies, but instead improving profitability through product upgrades, cost optimization, or management efficiency. During the same period, retail sales of apparel, footwear, hats, and knitwear by units above the designated limit reached 512.13 billion RMB, up 8.1% year-on-year, with growth accelerating by 5 percentage points compared to the previous year, indicating a genuine recovery in domestic consumer demand.
However, external demand and investment data tell a different story. From January to May, total textile and apparel exports were $116.73 billion, up a marginal 0.1% year-on-year. Apparel exports fell 1.6%, while textile exports (including fabrics, yarns, and other intermediate goods) grew 1.7%. This pattern of 'strong intermediates, weak finished goods' suggests global brands and retailers are still destocking or placing cautious orders, while China's role as a stable upstream supplier remains unchallenged. The divergence in fixed asset investment is even more pronounced: investment in the textile sector grew 10.8%, while apparel and chemical fiber sectors fell 10.3% and 14.5%, respectively. Capital is clearly concentrating on spinning and weaving segments with higher technical barriers and automation potential, while remaining cautious about labor-intensive garment manufacturing and overcapacity-prone chemical fibers.
The Intelligence Economy: From Tool to Infrastructure
The conference theme 'Intelligent Weaving for the Future' is not an empty slogan. Data shared by Sun Ruizhe reveals the depth of AI penetration in textiles. Jiangsu Yueda Textile's 'Lighthouse Factory', through intelligent manufacturing, reduced labor per 10,000 spindles by about 70%, increased overall labor productivity by over four times, cut energy consumption per unit by 15%, and lowered processing costs by 26%. Semir's AI-assisted design system boosted overall design and development efficiency by 35%, with pattern design efficiency increasing by over 200%. Bosideng's 'AI Aesthetic Brain' reduced sample development costs by over 60%.
These cases demonstrate that AI applications in textiles have moved from single-point experiments to system integration. More importantly, they are changing the industry's cost structure and competitive logic. Previously, a textile factory's competitiveness depended on labor costs, land costs, and equipment depreciation. Now, data, algorithms, and computing power have become new factors of production. Sun noted that global data center electricity demand is expected to grow by 175% by 2030 compared to 2023, implying that the energy structure of future textile enterprises may shift from 'machines using electricity' to 'computing using electricity'. Anoroc's move to build a full-chain ecosystem from dyes to AI design is a microcosm of this trend.
For buyers, this means the criteria for selecting suppliers need updating. In the past, the focus was on production capacity, delivery time, and price. In the future, a supplier's digital maturity, depth of AI application, and data governance capabilities must also be evaluated. A factory with an intelligent scheduling system and AI quality inspection can offer far greater stability and yield than a traditional factory, potentially providing a lower total cost even if its quoted price is slightly higher.
The Experience Economy: Consumers Redefining 'Good Products'
Running parallel to the intelligence economy is the experience economy. Sun pointed out that the global consumer market is characterized by three major trends: ecological restructuring, a return to human-centric values, and structural differentiation. Consumers are no longer satisfied with the basic function of 'a wool sweater keeping you warm.' They seek health and well-being (e.g., wool's natural antibacterial and biodegradable properties), emotional connection (e.g., brand stories, Chinese-style designs), and self-expression (e.g., personalized customization, social media sharing).
Behind Dalang's annual production of 900 million garments is the maturity of the 'small order, quick response' model. The cycle from a consumer seeing a garment on social media to placing an order, production, and delivery has been compressed to days or even hours. This demands extreme supply chain flexibility—not just being able to produce, but being able to switch quickly, handle small batches, a wide variety, and zero inventory. Sun mentioned that 'one-person companies' and 'DIY economies' are booming, with the number of newly registered individual businesses in China up 47% year-on-year in the first half of 2025. These micro-entrepreneurs often have more fragmented demands on upstream fabric and garment suppliers, seeking design appeal and fast delivery.
Dalang's Sample Significance
Dalang, as the host city for this conference, is the best illustration of these trends with its own industrial data. One in five sweaters globally comes from Dalang, a testament to its highly concentrated industrial chain: from wool raw material trading, yarn dyeing, knitting, to finishing and logistics, all steps are completed within a radius of a few dozen kilometers. This geographic agglomeration significantly reduces transaction costs and logistics time, enabling Dalang to respond quickly to changes in global orders.
However, Dalang's challenges are equally typical. The 10.3% decline in fixed asset investment in the apparel sector suggests many small and medium factories are hesitant about automation upgrades. The 14.5% drop in chemical fiber investment reflects price volatility and overcapacity pressures upstream. For Dalang's wool knitting enterprises, the key to survival is to introduce intelligent equipment and digital management while maintaining their flexibility.