"China’s Textile Hubs Strained as Rising Oil Costs and Falling Orders Squeeze Factories", 4 September 2026

Textile manufacturers in eastern China are facing mounting pressure as surging raw material costs collide with falling orders, pushing some factories to the edge of shutdown.

...prices for key inputs used across Zhejiang province’s vast textile sector have doubled...At the same time, demand has softened, leaving many companies caught in a squeeze where production costs exceed selling prices...

“Materials that used to cost 1 million yuan (approximately US$140,000) are now 2 million,” a member of a local textile industry association told the publication...

He said many firms have only one to two months of inventory left, while some smaller factories can sustain operations for just a few weeks. If conditions do not improve, several are considering halting production by mid-April...

Since February, the war has disrupted shipping through the Strait of Hormuz, a critical chokepoint for global energy supplies. The resulting constraints have driven up oil prices and, in turn, the cost of petrochemical-based textile inputs...

“When upstream prices rise, the pressure hits factories almost immediately.”

Manufacturers say they are trapped between rising input costs and weak downstream demand.

“Upstream prices are climbing, but downstream buyers won’t accept higher prices,” the trader said...

That dynamic has left factories in a bind—those without stockpiled materials are reluctant to buy at inflated prices, while those with inventory are hesitant to ramp up production without firm orders...

Zhejiang Province['s]...[textile] sector’s structure—dominated by small- and medium-sized enterprises—makes it especially vulnerable to price volatility and demand swings.

“Raw material prices change every day, but finished products have very thin margins,” the textile industry association member said. “If you produce, you lose money. If you stop, you still have to pay workers, rent, and utilities.”...

Another industry association member told The Epoch Times that shipping constraints linked to the Strait of Hormuz are making companies wary of taking on new orders.

“Some companies are deliberately cutting back to avoid bigger losses.”...