The United States textile and apparel industry is navigating a challenging period as weakening global demand continues to pull down national export figures. According to the latest data from the Office of Textiles and Apparel (OTEXA), a division of the U.S. Department of Commerce, sector exports declined by 3.63 percent to $16.732 billion during the first nine months of 2025. This downturn marks the second consecutive annual decline, effectively reversing the post-pandemic rebound seen in 2022.
The slump in export performance reflects a combination of softer global consumer demand, intensifying price competition from Asian suppliers, and a cautious approach by retailers regarding inventory orders. This trend is most evident among the United States' primary regional trading partners. Shipments to Mexico, the largest market for U.S. textiles, fell by 7.56 percent to $4.958 billion. This contraction signals a significant slowdown in Mexico’s export-oriented garment sector, which relies heavily on U.S.-made yarns and fabrics for its production.
Similar patterns emerged in Honduras and the Dominican Republic, where U.S. exports faced double-digit declines. Subdued ordering from major American brands has weighed heavily on regional supply chains linked through the CAFTA-DR trade agreement. Currently, many global brands are rebalancing their inventories and sourcing volumes, which has directly choked the flow of raw materials from U.S. mills to Central American garment factories.
However, amidst the stagnation of traditional markets, a silver lining appeared in Europe and Japan. Exports to the Netherlands, Japan, and Belgium rose significantly, with gains of up to 14.65 percent. This growth was fueled by steady demand for technical textiles and niche fabrics. Furthermore, European manufacturers appear to be adjusting their sourcing strategies, diversifying their material suppliers to reduce overdependence on a limited number of Asian inputs.
When analyzed by product category, apparel exports suffered the sharpest blow, falling 5.49 percent as they struggled with cost competitiveness against lower-cost producers. Yarn exports also dropped by 5.56 percent, reflecting weakened demand from regional mills facing slower order flows. Meanwhile, fabric exports and miscellaneous textile items saw more moderate declines.
The decrease in shipments to China also highlights an important structural shift in the global industry. China is increasingly producing its own upstream textile inputs domestically, reducing the need for imported raw materials from the United States. With annual exports now fluctuating below the $23 billion mark, the U.S. textile industry remains under pressure to find new strategies to stay competitive in an increasingly dynamic global landscape.
