Global merchandise trade grew 3.2% in volume and 11% in value in Q1 2026, but the gains are far from uniform. Asia's export volume surged 12.9% year-on-year, while the Middle East plunged 11.9%, and North America's import value contracted 7%. For textile exporters, understanding this divergence matters more than the headline numbers, as it directly shapes order flows and pricing power.
Regional Divergence: Who Grows, Who Stalls
Asia is the core engine of this trade cycle. Export volume rose 12.9%, import volume 14.6%, and export value soared 20% in Q1. The driver is the AI supply chain—chips, smart hardware, and supporting equipment demand concentrated in China, South Korea, Singapore, Thailand, and Taiwan. For textiles, this means higher manufacturing activity in Southeast and East Asia, potentially boosting demand for fabrics, trims, and industrial textiles.
The Middle East is the biggest casualty of geopolitical conflict. Import volume fell 9.7%, export volume 11.9%, with pressure expected to intensify in Q2. Red Sea shipping disruptions and supply chain interruptions raise freight costs and lead times, elevating payment and delivery risks for exporters reliant on that market.
Europe shows a pattern of weak exports and slight import growth—export volume down 2.6%, imports up only 0.6%. Soft external demand suggests European brands are delaying orders for premium fabrics and home textiles. North America, with import volume down 10.7% and import value down 7%, signals shrinking domestic demand and weak retail replenishment.
Long-term Potential: South America and Africa as Second Curve
Short-term export momentum in South America, Africa, and the CIS is muted, but over a longer horizon, South America's cumulative export volume since early 2023 is up 22.5% and imports up 24.5%, second only to Asia. Africa's cumulative import growth of 25% ranks first globally. These regions are becoming a "second curve" for textile exports, driven by infrastructure and consumption upgrades, with less intense competition than mature markets.
Energy supply rebalancing may boost resource-rich regions. Oil exporters increasing output to fill the Middle East gap could lift South America, Africa, and the CIS in Q2, improving purchasing power and demand for mid-to-low-end apparel and home textiles.
Headline Economies: Opportunity Windows in Divergent Growth
Among major economies, South Korea leads export value growth at 38.4%, followed by Hong Kong at 38.3%, the US at 15.2%, China at 14.7%, and the EU at a slower 9.2%. On the import side, China's import value surged 23%, far exceeding the EU's 11.4% and the UK's 28%, indicating resilient domestic demand.
For textile exporters, China's domestic market remains a stable anchor, while the high growth in South Korea and Hong Kong signals active entrepot trade and regional supply chains—textile intermediates like yarn and greige fabric may flow through these hubs to final markets.