The first-half export figure settled at $35.175 billion, with growth narrowing to 1.99%, down 0.92 percentage points from Q1. This slowdown is not a demand collapse but the result of a high base, geopolitical disruptions, and trade barriers. For buyers, the real signal lies in product segments: woven fabrics saw volume rise but prices fall, while knits achieved both, signaling a quiet shift in export structure.
Divergence Behind the Data
Woven printed and dyed fabric exports reached $19.156 billion in H1, up only 0.62% year-on-year, with volume up 1.98% to 20.811 billion meters and average price down 1.08% to $0.92/meter. The volume-up-price-down pattern indicates low-end woven products are still competing on price, squeezing margins. In contrast, knitted fabrics exported $16.019 billion, up 3.69%, with volume up 3.43% to 3.3759 million tons and average price slightly up 0.25%, showing stronger resilience. This divergence suggests downstream apparel demand is shifting toward elastic and functional knits, while traditional woven suiting faces intense price competition.
From a market perspective, exports to the top ten markets totaled $19.141 billion, up 4.86%, outpacing the overall growth by 2.87 percentage points and accounting for 54.42% of total exports. Vietnam, Bangladesh, and Cambodia together accounted for 32.79%, up 1.81 percentage points from Q1, with Cambodia leading at 13.92% growth. Exports to ASEAN reached $12.577 billion, up 3.06%, representing 35.76% of total; RCEP members totaled $13.044 billion, up 2.74%. These figures confirm that the global textile supply chain is accelerating its shift toward Southeast Asia, and China's export resilience relies more on regional supply chain coordination than on traditional Western markets.
External Pressures and Domestic Support
The Q2 slowdown was directly triggered by Middle East geopolitical conflicts disrupting shipping, weak global consumption recovery, and new production capacity in multiple countries. The IMF projects global growth to slow from 3.5% in 2025 to 3% in 2026, with goods and services trade volume growth falling to 3.5%, implying continued weak external demand in H2. More concerning is the deteriorating trade policy environment: new US 301 tariffs on China, EU removal of the de minimis exemption, and rising ESG and carbon footprint barriers. These measures raise compliance costs and challenge delivery capabilities for small and medium-sized dyeing and printing enterprises.
Domestic demand thus becomes the core hedge against external risks, but the structural imbalance of strong supply and weak demand persists. In July, the State Council issued the 15th Five-Year Plan for Expanding Consumption, with policies gradually being implemented to boost household, sports, and industrial textiles. The large population base and growing middle-income group imply ample domestic potential, but whether enterprises can convert policy dividends into actual orders depends on aligning products with consumption upgrades. Low-price volume strategies will not sustain in the domestic market either.
Transformation Path and Practical Advice
To navigate the cycle, the key is not waiting for demand recovery but actively adjusting product structure, market layout, and production methods. High-value knitted fabrics and functional eco-friendly products are the breakthrough to escape low-price competition; ASEAN and RCEP regions remain the main growth battlefield, but overdependence on single markets is risky; green and digital transformation is not just compliance but a competitive differentiator.