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Global Textile Manufacturers Faced Continued Downturn

Weak demand and high costs continue to pressure textile firms, forcing operators to pivot toward automation and new markets.

Updated on Oct. 6, 2026 in Economic Indicators

Isometric editorial illustration of a heavy industrial textile loom in muted tones, representing the current manufacturing sector economic climate.
Global textile manufacturers are reporting a continued economic downturn as weak demand and high energy costs force a shift toward automation. AI Illustration. Upload story photo >

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The International Textile Manufacturers Federation reported that global business conditions remain at negative 23 percentage points, reflecting a persistent industry-wide slump. Operators are grappling with weak demand and rising overhead as they navigate ongoing geopolitical instability.

Why it matters

Persistently high energy and raw material prices are squeezing margins for textile businesses globally, making it difficult to achieve significant recovery. These conditions, exacerbated by conflict in Iran, are forcing firms to prioritize efficiency over expansion.

The global textile business situation currently sits at negative 23 percentage points, an improvement from the record low of negative 46 percentage points seen in November 2023. Meanwhile, global capacity utilization holds at 71 percent, while average order cancellations remain at 2 percent.

The players

International Textile Manufacturers Federation

An international trade association representing the global textile industry through research and policy advocacy.

The details

To mitigate the impact of weak demand, which concerns 56 percent of the sector, manufacturers are increasingly investing in automation to lower operating costs. Companies are also actively diversifying into non-US markets to circumvent the impact of new US tariffs. High energy costs, affecting 41 percent of firms, further complicate efforts to maintain historical production levels.

Timeline

  1. November 2023: The global business situation index reached a record low.

  2. September 21-29, 2026: The ITMF conducted the 40th global industry survey.

  3. October 6, 2026: Results from the industry survey were published.

  4. Next six months: This period remains the outlook horizon for business expectations.

Market Landscape

The current industry environment marks a slight improvement from the record low established during the November 2023 downturn. While sentiment has ticked upward, high inflationary pressures and energy costs continue to mirror the challenging conditions that defined that previous period.

Owners should evaluate their current exposure to energy costs and determine if automation investments can improve stagnant capacity utilization rates. Monitor the next six months closely, as industry expectations remain muted at positive 19 percentage points.

The takeaway

The textile industry is facing a structural shift where efficiency and market diversification are becoming essential for survival. Operators should monitor their order intake metrics closely as a primary signal for any sustained turnaround in demand.

Further reading

For broader trends on global industrial performance, visit our Economic Indicators section.

More information

For detailed data and methodology, visit the International Textile Manufacturers Federation website.

Source note: This article includes information reported by Textile World.

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