In the first half of 2026, China's textile and apparel exports painted a nuanced picture: total value reached $145.96 billion, up a mere 1.4% year-on-year, but June alone saw exports of $29.27 billion, surging 14.3% month-on-month. This is not simply a market recovery but a fundamental structural shift—from garment assembly to intermediate goods exports—that will determine which players remain competitive over the next five years.
June Turning Point: Restocking Meets Autumn-Winter Orders
June's export data is the most critical signal of the half year. Textile exports hit $13.52 billion, up 12.2% YoY and 7.4% MoM; apparel exports stood at $15.75 billion, up 3.2% YoY but surging 21% MoM. This contrast reveals two truths: overseas brands have finally entered an active restocking phase, and restocking is heavily concentrated in semi-finished products like fabrics and yarns.
Timing is key. June traditionally marks the start of autumn-winter ordering. In 2026, overseas brands advanced their order placement by 2-3 weeks to avoid potential shipping bottlenecks and freight rate hikes in the peak season. The temporary de-escalation of Middle East tensions and falling ocean freight rates also cleared the way for this concentrated order release.
For buyers, the implication is clear: if June orders were exploratory, July-August data will determine H2 trends. Industry consensus pegs Q3 export growth at 5%-8%, provided Western consumer demand does not deteriorate unexpectedly.
Intermediate Goods Resilience: The Supply Chain Premium
In H1, textile exports reached $73 billion, up 3.5% YoY, while apparel exports totaled $72.96 billion, down 0.7%. The gap is narrow but the trend divergence is stark. Deeper data from January-May shows yarn exports up 6.6%, fabric down only 0.5%, and apparel accessories down 1.6%.
This structural difference is no coincidence. Overseas brands are now executing 'low inventory, high frequency' procurement strategies, reducing large bulk garment orders in favor of semi-finished yarns and fabrics, which are then finished locally or in third-country factories. This model demands high delivery efficiency, quality consistency, and flexible response—precisely the strengths of China's textile supply chain.
From chemical fiber, spinning, dyeing to finished products, China boasts the world's most complete textile supply chain. An order from yarn to fabric can be completed in 7-10 days within industrial clusters like Keqiao or Shengze. This 'one-stop' delivery capability is something Southeast Asian or South Asian single-link capacity cannot replicate. It explains why upstream textile categories continue to grow while garment processing faces price wars.
Market Divergence: US Alone Drives Growth, EU and Japan Stall
January-May export data shows the US market as the biggest growth driver. Exports to the US expanded 15 percentage points faster than the same period last year. The US-China summit stabilized bilateral trade expectations, and with overseas brands' inventory depletion largely complete, buyers have renewed reliance on Chinese supply chains.
In contrast, the EU is mired in high energy costs and inflation, suppressing apparel consumption. Japan and South Korea are also weak, constrained by regional tensions and rising energy prices. ASEAN, a key transshipment node, saw declining textile imports from China, reflecting overall weak global final demand.
This divergence means exporters can no longer rely on a 'if one market fails, another will compensate' strategy. The sustainability of US market growth depends on bilateral relations and US consumer spending power. If the US economy slows in H2, textile exports will face a lack of alternative markets.
Currency Distortion: The Profit Reality in RMB Terms
In RMB terms, H1 textile and apparel exports totaled 1,012.22 billion yuan, down 2.2% YoY. Textiles reached 506.42 billion yuan, down only 0.1%; apparel hit 505.8 billion yuan, down 4.2%. The gap between USD and RMB figures directly reflects the erosion of exporter profits due to currency fluctuations.
For exporters settling in foreign currency, RMB appreciation means reduced proceeds upon conversion. The RMB's trading range widened in H1 2026, raising the cost of locking in forward exchange rates. This demands that foreign trade companies integrate currency risk management into daily operations, rather than relying solely on order margins to cover exchange losses.