Global merchandise trade in Q1 2026 grew 3.2% in volume and 11% in value year-on-year, but the expansion was highly uneven. Asia led with double-digit import and export volume growth, while the Middle East contracted sharply and North America's import value fell 7%. For textile exporters, this is not a routine cyclical fluctuation but a structural shift in supply chains and demand patterns, directly influencing order flows and pricing strategies in coming quarters.
The Logic Behind the Data
Total trade volume rose 1.9% quarter-on-quarter and 3.2% year-on-year, while trade value increased 2% QoQ and 11% YoY. Achieving this growth on top of the high base from Q1 2025 - when North America front-loaded imports due to tariff expectations - underscores unexpected resilience. However, the regional breakdown is more telling: Asia's import and export volumes grew 14.6% and 12.9% YoY respectively, with export value up 20% and import value up 22%, both leading globally. Growth was not driven by a single market; China, South Korea, Singapore, Thailand, and Taiwan all contributed, fueled by AI chip and smart hardware demand, which indirectly boosts orders for fabrics, accessories, and packaging materials in the electronics supply chain.
In contrast, the Middle East saw import volumes fall 9.7% and exports drop 11.9%, with import value down 6% - one of the worst-performing regions. Geopolitical conflicts disrupted supply chains and logistics efficiency, directly suppressing cargo turnover. For textile exporters long dependent on Middle Eastern markets, this signals shrinking orders and higher payment risks, necessitating tighter credit insurance and payment terms.
Divergence in the West and Emerging Market Opportunities
North America's export volume rose 7% YoY, but import volume fell 10.7% and import value dropped 7%, indicating clear domestic demand contraction. Europe showed a pattern of weaker exports and slightly higher imports: export volume fell 2.6%, while imports edged up 0.6%, reflecting sluggish manufacturing orders. As traditional textile consumption hubs, weak demand in the US and Europe will directly impact apparel and home textile order releases, putting dual pressure on price and volume for exporters targeting these regions.
Meanwhile, South America, Africa, and the CIS region showed weak short-term export momentum but have strong long-term potential. Since early 2023, South America has accumulated export growth of 22.5% and import growth of 24.5%, second only to Asia; Africa's cumulative import growth of 25% ranks first globally. With oil exporters ramping up production to fill the Middle East supply gap, these regions are expected to see export rebounds in Q2. For textile trade, this means new growth markets: infrastructure and urbanization in South America and Africa will drive demand for industrial textiles and home furnishings, while higher energy revenues in the CIS may boost consumer textile imports.
Divergence Among Major Economies and Textile Order Transmission
Among top economies, all five major exporters posted positive growth but with stark differences: South Korea led at 38.4%, followed by Hong Kong at 38.3%, the US at 15.2%, China at 14.7%, and the EU at 9.2%. On the import side, China's imports grew 23%, Hong Kong 44.8%, the UK 28%, while the US fell 13.6%. This divergence implies that the destination structure of textile supply chains is shifting: intra-Asian trade is more active, and Chinese textile exports to Southeast Asia, Japan, and Korea may benefit from regional industrial synergy; while weak US demand will push exporters to pivot to the EU, the Middle East (despite short-term risks), and emerging markets.
For textile factories, changes in order composition matter more than total volume. The expansion of Asia's electronics industry creates new demand for functional fabrics, anti-static materials, and non-woven packaging; traditional US and European apparel orders may shift to Vietnam and Bangladesh, so Chinese suppliers must differentiate through quality and lead time. Meanwhile, Middle East risks require exporters to strengthen risk mitigation, such as using letters of credit, purchasing export credit insurance, or exploring relatively stable Gulf states.