China's wool textile sector posted a robust performance in the first five months of 2026, but the dual-growth data warrants deeper analysis. Behind the total trade volume of $6.06 billion—up 8.16% year-on-year—lies a significant divergence: exports grew only 2.29% while imports surged 27.35%. This signals accelerated inventory building in domestic wool processing, while overseas end-demand has yet to fully ignite.
Emerging Markets Drive Export Growth, Traditional Markets Show Divergence
Among the $4.35 billion in exports, standout performances came from exports to India ($76 million, up 40.19%) and Turkey ($41.46 million, up 24.89%), driven largely by wool tops—a key intermediate product. In the first five months, China exported 13,300 tons of wool tops worth $178 million, soaring 21.68% year-on-year. This reflects that India and Turkey, as intermediate textile manufacturing hubs, are absorbing more global orders for semi-finished wool inputs.
Traditional markets showed mixed results. Germany maintained growth, while export volumes to Vietnam and Italy dipped slightly—though their export values still rose, indicating higher unit prices offsetting lower volumes. Wool and cashmere product exports grew 5.11% and 6.97% respectively, with knitted sweaters and other end-products showing stable demand. However, the slower growth rate for finished goods compared to intermediates suggests overseas brands are still cautious in inventory building.
Import Surge Reveals Rising Domestic Capacity Utilization and Price Pressure
The import figure of $1.71 billion—up 27.35%—is the most telling data point in this report. Cashmere raw material and product imports reached $127 million, a staggering 44.61% increase, far outpacing overall import growth. This indicates that domestic fine-wool and cashmere processing enterprises are ramping up purchases of premium Australian and South African wool to meet autumn/winter order production.
Yet the high import growth also carries risks: rising international wool prices are increasing input costs for enterprises, potentially squeezing second-half margins. Meanwhile, the volume and value of high-end cashmere fabrics and garments imported are both climbing, signaling robust domestic luxury demand—but also showing that China still relies on imports for some high-value-added products, leaving room for domestic substitution.
Core Logic Behind Dual Growth and Outlook
The dual growth is driven by three factors: early placement of overseas autumn/winter orders boosting demand for intermediate goods like wool tops in emerging manufacturing countries; domestic consumption recovery combined with enterprise technical upgrades and capacity expansion; and China's competitive advantage in the full wool textile chain, stabilizing the international competitiveness of wool yarn and knitted garments.
Looking ahead, exports are likely to maintain resilience as the peak overseas autumn/winter procurement season arrives, though growth may be tempered by uncertainty in Western end-consumer demand. Imports will likely stay elevated due to high raw material prices, but enterprises must watch for inventory buildup risks. The industry is shifting from volume growth to quality improvement, with high-end and differentiated products becoming key to capturing global market share.