In April 2026, China's textile and apparel exports reached $24.053 billion. Behind this figure, yarns and fabrics versus apparel showed starkly different trajectories: the former accumulated $46.896 billion in the first four months, up 2.3% year-on-year; the latter totaled $44.231 billion, down 0.9%. The divergence is widening, reflecting contrasting fortunes along the supply chain.
Structural Divergence: Intermediate Goods Resilience vs. End-Product Weakness
As intermediate goods, yarn and fabric exports benefited from restocking demand in Southeast Asian and South Asian garment processing countries. Since 2024, recovering apparel orders in Vietnam and Bangladesh have boosted purchases of Chinese grey fabrics and yarns. Customs data shows the 2.3% cumulative growth in yarn and fabric exports from January to April, despite a high base of $45.836 billion in the same period of 2025, underscores supply chain resilience.
Apparel export contraction directly mirrors sluggish retail markets in Europe and the U.S. In Q1 2026, U.S. apparel retail inventories rose about 4% year-on-year, while European consumer confidence remained low, prompting cautious ordering by brands. The 0.9% decline in apparel exports, an absolute drop of approximately $380 million, pressures capacity utilization and profit margins for small and medium-sized garment factories.
Import data offers a more telling signal. From January to April, China imported $3.774 billion worth of textile yarns and fabrics, a surge of 19.1% year-on-year. This growth far exceeds export growth, indicating domestic textile mills are accelerating purchases of high-end raw materials—especially functional fibers, high-count cotton yarns, and specialty chemical fibers—to meet domestic brand upgrades and product differentiation. The import surge also highlights gaps in domestic substitution at the premium end.
Industrial Cluster Responses: Keqiao Busy Shipping, Humen Struggling for Orders
At the cluster level, Keqiao in Shaoxing, the world's largest textile distribution center, saw fabric traders report 'more orders but thinner margins' in Q1 2026. The growth in yarn and fabric exports was largely volume-driven, with unit prices stagnant, reflecting enhanced bargaining power of Southeast Asian buyers. In Nantong's home textile cluster, the spillover from apparel export decline forced some garment fabric lines to switch to home textiles, intensifying price competition in mid-to-low-end segments.
In garment processing hubs like Humen and Zhongshan in Guangdong, capacity utilization in April hovered between 60% and 70%, down about 10 percentage points year-on-year. Foreign trade firms report that European and American brands are placing smaller, fragmented orders, making the traditional 'large batch, long cycle' model unsustainable. Some factories have pivoted to domestic sales or cross-border e-commerce for small-batch, quick-response orders, but profit margins are squeezed by logistics and return costs.
Prices and Inventories: Cost Pass-Through Blocked
On the raw material front, cotton spot prices averaged around 16,000 RMB/ton in April 2026, while PTA prices fluctuated. The growth in yarn and fabric exports failed to drive up raw material prices, suggesting profit distribution favors intermediate segments over upstream. In Shengze, grey fabric inventory days for weaving mills stood at 25-30 days, moderately high, with firms eager to destock.
For buyers, the structural divergence means significant differences in bargaining power across categories. Yarn and fabric supply is ample, allowing buyers to push for price concessions. Overcapacity in garment processing will intensify competition for orders. High import raw material prices urge domestic mills to accelerate substitute R&D and reduce foreign dependence.