In the first half of 2026, China's textile and apparel exports reached $145.96 billion, up a modest 1.4% year-on-year. But the real story lies in June: exports hit $29.27 billion, surging 7.2% YoY and 14.3% month-on-month, signaling the official start of autumn-winter restocking and a turning point after months of stagnation.
Structural Divergence: Upstream Strength, Downstream Weakness
The most striking feature of the first-half data is the split between upstream and downstream. Textile exports totaled $73 billion, up 3.5% YoY; apparel exports stood at $72.96 billion, down 0.7%. Although volumes are nearly equal, the growth gap exceeds 4 percentage points. In June, this divergence widened: textiles reached $13.52 billion, up 12.2%, while apparel hit $15.75 billion, up only 3.2%. Upstream yarns and fabrics showed far greater resilience than garments.
This structural divergence reflects shifting procurement strategies by overseas brands. Retailers in Europe and the US are maintaining low inventory levels, reducing bulk long-term garment orders in favor of frequent purchases of semi-finished goods like yarns and fabrics to cope with uncertain end-demand. China's complete textile supply chain—from chemical fiber, spinning, dyeing and finishing to finished products—is the core advantage sustaining upstream growth. In contrast, the garment OEM segment faces low entry barriers, capacity diversion, and intense price competition, making long-term pressure hard to reverse.
Data in RMB terms further highlight profit pressures. First-half cumulative exports were 1,012.22 billion yuan, down 2.2% YoY, with garment exports at 505.8 billion yuan, down 4.2%. Currency fluctuations eroded actual profits, hitting garment manufacturers hardest.
US Market Emerges as Top Growth Driver; EU and Japan Weaken
Global demand patterns showed significant fragmentation. The US market became the industry's largest incremental source in the first half, with export growth to the US expanding 15 percentage points compared to the same period last year. The China-US summit stabilized expectations, and after overseas brands completed destocking, they ramped up procurement from Chinese supply chains. The June export rebound also benefited from lower shipping costs and a temporary easing of Middle East tensions.
Conversely, traditional mature markets like the EU, Japan, and South Korea continued to lose momentum. The EU is mired in high energy costs and inflation, depressing consumer apparel spending. ASEAN, Japan, and South Korea, constrained by regional tensions and rising energy prices, also saw reduced textile and apparel imports from China. This means exporters are accelerating their market focus shift from Europe to the US and emerging markets.
Supply Chain Advantage as Key to Navigating Cycles
The first half of 2026 saw textile and apparel exports follow a pattern of "stable total volume, structural divergence, and month-end recovery." The June rebound has injected confidence, but the key lesson is clear: the era of low-cost, volume-driven exports is over. A complete supply chain, product innovation, and diversified global presence are the core levers for weathering industry cycles.
Looking ahead to the second half, the global trade environment remains complex. The World Bank warns that the global economy will face triple pressures from high energy prices, persistent inflation, and tighter monetary policies, with sluggish end-consumer demand in Europe and the US. However, backed by a deep industrial foundation, companies that adjust product and market strategies in time can still sustain stable export performance.