Fabric Mills NAICS 3132

May 8, 2025 - Faster Growth Forecast

• The US fabric mills industry is projected to grow at a CAGR of 4.89% between 2025 and 2029, according to a forecast from Inforum and the Interindustry Economic Research Fund, Inc. This rate is faster than the overall economy's anticipated growth. The nondurable goods manufacturing sector forecast indicates that the labor force is expected to diminish, barring immigration reform that allows greater numbers. However, new technologies could support labor productivity for the industry. Consumer sentiment is expected to improve in the forecast period, which bodes well for the sector. A factor that may curb consumer spending is substantially higher tariffs on consumer goods, which may be painful for households. On a positive note, lower inflation supports a moderate increase of real disposable income by about 2% in 2025 and 1.9% in 2026. Real income could suffer if average prices rise due to tariff implementation.
• According to a report in the Wall Street Journal, fabric manufacturers are feeling new tariffs cut both ways, as they win more business but also face uncertainty in trade policy and consumer demand. US fabric manufacturer STI Fabrics, a North Carolina-based company operating since 1964, said it is receiving increased interest from furniture makers seeking to switch to domestic suppliers from Chinese vendors due to Trump’s new tariff implementations. CEO Sean Gibbons said he will need to hire 100 workers for a third shift to produce materials to meet the higher demand. However, Gibbons said he must be cautious when making such a significant investment, as he is unsure how long the higher tariffs will stay in place. Similarly, some potential customers are hesitant to switch to US-made fabrics due to the fluctuating tariff situation. Customers may also switch their sourcing from China to countries such as India and Turkey, which have a lower base tariff of 10%.

• According to Textile World, textile mills are one of the 11 manufacturing industries reporting growth in April’s Manufacturing ISM Report on Business. Textile mills reported growth in production while seeing slower supplier deliveries, lower inventories and higher prices for raw materials. Other industries reporting growth were Apparel, Leather & Allied Products; Petroleum & Coal Products; Plastics & Rubber Products; Electrical Equipment, Appliances & Components; Computer & Electronic Products; Nonmetallic Mineral Products; Miscellaneous Manufacturing; Machinery; Chemical Products; and Primary Metals. Six manufacturing industries reported contraction during the period including Wood Products; Furniture & Related Products; Paper Products; Food, Beverage & Tobacco Products; Transportation Equipment; and Fabricated Metal Products. Overall, economic activity in the manufacturing sector contracted for the second consecutive month in April, with the Manufacturing PMI registering 48.7%.
• The Trump Administration's proposed 25% tariffs on Mexico and Canada could destabilize a crucial textile and apparel coproduction chain, according to the National Council of Textile Organization (NCTO). The US textile industry ships 53% ($12.3 billion) of its total global textile exports to Mexico and Canada, and those component materials often return to the US as finished products under the United States-Mexico-Canada Agreement (USMCA). The coproduction chain under the agreement represents $20 billion in two-way trade. The NCTO noted that the pipeline is an important alternative to the China-led, Asia-based production system that is alleged to compete using unfair tactics. Per the statement, “For these reasons, we are extremely concerned that the imposition of penalty tariffs on imports from our critical USMCA partners will only serve to benefit China and other Asian countries and harm the U.S. textile industry, which has lost 27 plants in the past 20 months.”