The tension in US-China textile trade escalated sharply in the spring of 2025. On April 7, the China National Textile and Apparel Council (CNTAC) issued a public statement firmly opposing a new round of US tariffs on Chinese textile and apparel products. This move signals that trade friction has shifted from exploratory pressure to substantive confrontation between the world's largest textile producer and consumer market.
Background and Industry Response
The direct catalyst for the statement was the recent signal from the US government about imposing additional tariffs. Although the specific rates and product coverage have not been fully disclosed, CNTAC's swift response indicates the industry perceives a serious threat. The phrase “firmly oppose” is rarely used in previous trade disputes, reflecting the gravity of the situation.
Chronologically, 2025 marks a policy adjustment window after the expiration of the Phase One trade deal. US domestic trade hawks are pushing to decouple supply chains from China via tariffs. For China's textile industry, the US market still accounts for a significant share—according to public industry data, China's textile and apparel exports to the US in 2024 represented approximately 15% to 18% of total exports, involving tens of thousands of enterprises and millions of jobs.
Industrial Impact: Cost Pass-Through and Order Loss
The most immediate impact of tariffs is cost escalation. Based on past experience, US buyers typically require Chinese exporters to bear 30% to 50% of tariff costs. For textile manufacturers with profit margins typically between 3% and 5%, this is nearly unbearable.
- Profit margins sharply squeezed: For a cotton shirt with an export price of $20, a 15% tariff adds $3 in cost. If the Chinese side bears half, the company loses $1.5 in profit, eroding most of its margin.
- Order diversion risk intensifies: Vietnam, Bangladesh, and India are closely watching the tariff moves. Once the tariff gap widens, buyers will accelerate order transfers to Southeast and South Asia. In 2024, Vietnam's textile exports to the US grew 12% year-on-year, with some categories already substituting Chinese products.
- Supply chain stability under pressure: Tariff uncertainty forces brands and retailers to shorten order cycles from the traditional 6 months to 3–4 months, compelling Chinese factories to be more flexible in adjusting capacity and inventory.
Response Paths: Domestic Demand and Diversification
Facing external pressure, China's textile industry is not without room for maneuver. Although CNTAC's statement did not provide specific countermeasures, industry consensus is clear:
First, deepen the domestic market. In 2024, China's retail sales of clothing and footwear exceeded 1.5 trillion yuan, with consumption upgrading driving demand for functional fabrics, eco-friendly recycled fibers, and other high-end categories. The domestic market can serve as a cushion against export headwinds.
Second, accelerate market diversification. Beyond the US, the EU, ASEAN, the Middle East, and Latin America offer significant growth potential. Under the RCEP framework, ASEAN countries increased textile imports from China by 8% in 2024, with tariff preferences gradually taking effect.
Third, enhance product value. Low-end OEM models are most vulnerable in tariff wars. Companies with design capabilities, brand premiums, or technological barriers enjoy stronger bargaining power. For example, some chemical fiber enterprises have developed high-strength, flame-retardant, and antibacterial functional products, successfully raising export unit prices by over 20%.