In the first half of 2026, China's dyed fabric exports reached $35.175 billion, a modest 1.99% year-on-year increase, but growth slowed by 0.92 percentage points from Q1. More notably, woven dyed fabrics saw export volume rise 1.98% while export value grew only 0.62%, with average unit price dropping 1.08% to $0.92 per meter. In contrast, knitted fabrics achieved both volume and value growth, with export value up 3.69% to $16.019 billion and volume up 3.43%, while average price edged up 0.25%. This divergence is not accidental but reflects global supply chain restructuring and domestic capacity shifts.
Divergence Behind the Data
The 'volume-for-price' strategy in woven fabrics hit a bottleneck in Q2. Export volume reached 20.811 billion meters, up 1.98%, but unit price fell, indicating that companies expanded output to maintain revenue while facing intensifying international competition. Knitted fabrics, with their closer ties to fast-growing sportswear and casual wear segments, showed stronger resilience. For buyers, this means better bargaining power in woven fabrics, while supply stability in knitted categories requires attention. For factories, simply expanding woven capacity no longer boosts profits; product mix adjustment is urgent.
Regional Markets: Southeast Asia and RCEP as Growth Engines
Exports to the top ten markets totaled $19.141 billion in H1, up 4.86% year-on-year, 2.87 percentage points higher than the overall growth rate, accounting for 54.42% of total exports. Vietnam, Bangladesh, and Cambodia together accounted for 32.79%, up 1.81 percentage points from Q1. Cambodia led with a 13.92% surge, while Vietnam grew only 0.52%, indicating divergent demand within Southeast Asia. Exports to ASEAN reached $12.577 billion, up 3.06%, and to RCEP members $13.044 billion, up 2.74%, both outperforming the industry average. These figures underscore the deepening shift of global apparel supply chains to Southeast Asia. However, Vietnam's weak growth may signal the rise of local capacity, intensifying order diversion. Traders should explore emerging markets like Cambodia and Indonesia rather than relying solely on Vietnam.
External Pressures and Domestic Policy Buffer
The Q2 slowdown was directly caused by geopolitical disruptions to shipping, weak global consumption, and new capacity in other countries. The IMF projects global GDP growth to slow from 3.5% to 3% in 2026, with goods trade volume growth falling to 3.5%. Additionally, new US Section 301 tariffs, the EU's removal of the de minimis exemption, and rising ESG green barriers are raising export costs. Against this backdrop, domestic demand serves as a 'ballast stone.' The State Council's '15th Five-Year Plan for Expanding Consumption' released in July is gradually boosting domestic spending. However, structural oversupply remains, and the domestic market is not yet a stable foundation. Companies must balance domestic and export sales to avoid over-reliance on any single market.
Practical Recommendations
For Buyers - For woven fabrics, consider locking in long-term orders at current low prices, but ensure quality stability. - For knitted fabrics, supply is tightening; sign quarterly framework agreements to secure delivery and pricing. - Prioritize suppliers with low-carbon traceability to meet ESG compliance in markets like the EU.
For Trading Companies - Increase R&D in knitted, functional, and eco-friendly fabrics to escape low-price competition. - Deepen presence in high-growth markets like Cambodia and Bangladesh, and explore Middle East and Latin America. - Leverage RCEP rules of origin to optimize regional supply chains and reduce tariffs. - Accelerate digital and green production upgrades, enhance carbon footprint management, and prepare for high-end market entry.
Overall, H1 exports showcased industry resilience, but external headwinds in H2 cannot be ignored. Only through product upgrading and market diversification can the industry maintain its share amid global textile transformation.