At the beginning of 2025, the data of Vietnam's textile industry showed a dramatic contrast. In January, imports of raw materials for textiles, garments, leather and footwear dropped by 12.9% year-on-year. However, during the same period, the United States' imports of clothing from Vietnam rose by 13.98% against the trend. Behind this contradiction lies the fact that Vietnam's textile industry is undergoing profound structural changes. Although the Chinese mainland still accounts for 61.9% of Vietnam's raw material supply share, the import value decreased by 5.9% year-on-year, indicating that its supply chain is gradually getting rid of its reliance on a single market and embarking on an independent reshaping process.
The predicament of the Ningxie market and the dual crisis of the physical business
As the largest distribution center for clothing and fabrics in northern Vietnam, Ninh Hoa Market was hit by a wave of closures in May 2025. The once bustling market is now deserted, with many shops choosing to close down. On the one hand, e-commerce platforms like TikTok and Shopee have swept the market with their price advantages, significantly squeezing the business space of physical stores. On the other hand, the Vietnamese government has launched a special campaign to crack down on counterfeit and shoddy goods, leaving merchants mainly engaged in the trading of high-quality fakes at a loss. This regulatory storm not only reshaped the order of the domestic market, but also reflected the huge gap between the domestic and foreign markets of Vietnam's textile industry - international orders were pouring in, while domestic retail was in trouble.
The reconstruction of the supply chain has brought about changes in the pattern of raw material imports
The decline in raw material import data for Vietnam's textile industry indicates that the global industrial chain pattern is undergoing changes. In January 2025, except for China's import volume which decreased by 5.9%, the import declines of South Korea and the United States were as high as 40.8% and 19.4% respectively. Meanwhile, local brands such as Uniqa and VinGroup have rapidly risen by leveraging cost control and localized operation strategies, accelerating the localization process of their supply chains. However, in the short term, this transformation also brings about growing pains. Small and medium-sized enterprises are under the dual pressure of raw material shortages and rising costs, and their production capacity has been significantly impacted.
Breaking through the international market and embarking on a path of high value-added transformation
In the international market, Vietnam's textile industry has demonstrated strong competitiveness. In the first quarter of 2025, the growth rate of the United States' clothing imports from Vietnam far exceeded that of China. Moreover, the average price index of Vietnam's clothing reached as high as 111, far exceeding the global average, while that of China was only 59. This indicates that Vietnam is successfully shaking off the label of "low-end contract manufacturing" and moving towards the field of high value-added products. The investment of 150 million US dollars by a certain international major factory in building a high-end knitted fabric factory in Vietnam is a powerful evidence of this transformation trend. However, the leap from contract manufacturing to branding is not achieved overnight. Challenges such as capital investment, technological research and development, and brand building still need to be overcome over the long term.
Standing at the crossroads of industrial transformation, Vietnam's textile industry is undergoing a difficult transformation from quantitative change to qualitative change. In the coming year, its exports to the United States are expected to continue to grow. However, if the chaotic situation in the domestic market cannot be improved, it may become a key factor restricting industrial upgrading. This transformation not only concerns the survival and development of enterprises, but also determines Vietnam's ultimate position in the global textile industry chain.
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