NCTO annual meeting: US textile output holds at $60.9bn in 2025 despite trade and tariff headwinds

The National Council of Textile Organizations (NCTO) has confirmed that the United States textile industry remained broadly stable through 2025, holding its ground against a backdrop of acute trade disruption, tariff volatility, and relentless competition from Asian manufacturing platforms. Chuck Hall, NCTO’s chairman and president and CEO of Spartanburg, South Carolina-based Barnet, presented the industry overview at NCTO’s 22nd Annual Meeting, held from 14 to 16 April 2026 at the Mayflower Hotel in Washington, DC. The headline stability, however, carries a structural asterisk: more than 40 textile facilities closed across the United States in the span of roughly two and a half years, a number that Chuck Hall opened his address with deliberately and without softening. The overall picture the NCTO painted is that of an industry that won meaningful policy battles in 2025 while continuing to absorb the compounding consequences of decades of offshoring, import competition, and an uneven trade playing field that remained only partially corrected by year’s end.

How did the US textile industry perform financially and operationally in 2025?

The US textile and apparel supply chain employed 453,122 workers in 2025, with the US government estimating that one textile manufacturing job supports three additional jobs in the broader economy. Total textile and apparel shipments reached $60.9 billion for the year, a decline from the $63.9 billion recorded in 2024, which itself had slipped from $64.8 billion in 2023, representing a 1.3 percent decrease year-on-year driven by softness across textile mills, textile products, apparel, and man-made fibres. The trajectory is not a collapse, but the direction is consistent, and the pace of facility closures suggests the headline number conceals meaningful structural erosion beneath it. An industry that employed well over 471,000 workers as recently as 2024 has now shed further headcount, and the communities absorbing those losses, many of them rural and economically dependent on a single mill, face adjustment costs that aggregate industry statistics do not capture.

Export performance also softened. Fibre, textile, and apparel exports combined reached $26.9 billion in 2024, the most recent full year for which export data was available at the time of the annual meeting, a decline from $28 billion the prior year and $29.7 billion in 2022. Despite the volume compression, the United States retained its position as the second largest exporter of textile-related products in the world, a competitive standing underpinned by the country’s technological sophistication, defense procurement relationships, and integration with Western Hemisphere manufacturing partners rather than by volume economics alone.

Why the de minimis loophole closure matters for domestic textile manufacturers

Among the most consequential policy developments of 2025, from the industry’s perspective, was the meaningful progress toward closing the de minimis loophole that had for years allowed foreign shippers, overwhelmingly Chinese e-commerce operators, to flood the US market with goods valued at or below $800 per shipment entirely free of tariffs and customs scrutiny. Effective 29 August 2025, all commercial shipments became subject to the same customs documentation requirements, including disclosure of origin and classification, as well as payment of applicable duties and fees. The NCTO had spent years building the case for this reform, arguing the loophole devastated domestic manufacturers, undercut American jobs, and opened the market to unsafe and counterfeit goods as well as products manufactured with forced labour.

The scale of the distortion the loophole created is worth understanding precisely. Approximately half of all de minimis shipments arriving in the United States were estimated to be textile and apparel products, meaning the provision functionally operated as a large-scale duty exemption concentrated in the sector most vulnerable to import competition. The Senate subsequently moved to make the closure permanent through a budget reconciliation package that would end de minimis for commercial shipments from all countries by 1 July 2027, mirroring language included in the House reconciliation package passed earlier in 2025. That legislative backstop matters because executive actions can be reversed. A statutory closure, if enacted into law, would lock in the level playing field the NCTO has argued domestic producers need to plan investment with confidence.

The competitive implications extend beyond pricing parity. The de minimis mechanism had functioned as an enforcement blind spot for the Uyghur Forced Labor Prevention Act, making it practically impossible for customs authorities to screen high-volume, low-value parcels for goods manufactured using forced labour in Xinjiang. Closing that channel simultaneously advances trade compliance and labor rights enforcement objectives, two priorities that rarely align so neatly in industrial policy.

What Western Hemisphere tariff exemptions mean for the US textile supply chain

The NCTO’s second major advocacy win in 2025 centred on preserving duty-free access for textile and apparel goods produced under the rules of origin established by the United States-Mexico-Canada Agreement (USMCA) and, to a contested degree, the Dominican Republic-Central America-United States Free Trade Agreement (CAFTA-DR). The Western Hemisphere as a whole accounts for nearly 70 percent of all US textile exports, represents $34 billion in annual two-way trade, and supports 2.6 million jobs across the hemisphere. For the US textile industry specifically, the USMCA relationship is not a peripheral arrangement. The industry ships $12.3 billion, or 53 percent, of its total global textile exports to Mexico and Canada, with those component materials often returning as finished products to the United States under USMCA’s rules of origin framework.

The Trump administration’s decision to preserve duty-free treatment for USMCA-qualifying goods from the tariff regime introduced under the International Emergency Economic Powers Act was therefore received as a significant relief by domestic producers who had feared disruption to a supply chain that took decades to build. The CAFTA-DR situation remained more complicated. The NCTO engaged heavily to obtain removal of penalty tariffs on qualifying CAFTA-DR imports, arguing that when China’s tariff rates are lower than those applied to some regional countries, it only encourages retailers to remain sourced from China rather than the Western Hemisphere, precisely the opposite of the reshoring intent behind the broader tariff strategy.

The analytical point here is structural. The USMCA and CAFTA-DR co-production chains were designed deliberately as an alternative architecture to the China-led Asian production platform. US mills supply fibre and fabric inputs; partner countries in Central America and Mexico perform cutting, sewing, and finishing operations; and finished goods re-enter the US market under preferential rules. Disrupting that chain through indiscriminate tariff application would not automatically reshore the sewing and assembly stages to the United States. It would more likely redirect sourcing toward fully integrated Asian suppliers who can manufacture the entire garment without touching a US-origin input.

How did NCTO advocacy shape defense procurement and customs enforcement priorities?

The Berry Amendment, which requires the Department of Defense to source 100 percent of its textile and clothing needs from US manufacturers, remained a central advocacy priority for the NCTO through 2025. The organisation continued pressing for expansion of the Berry Amendment following key provisions secured in the Fiscal Year 2025 National Defense Authorization Act, which Congress passed in late 2024. The NDAA included two new provisions supporting the Berry Amendment, reinforcing the domestic textile industry’s role as a strategic supplier to the US military. The Make PPE in America Act enforcement was a related front, with NCTO’s advocacy contributing to government contract awards for member companies in personal protective equipment.

The defense dimension of the US textile industry is frequently underappreciated in commercial coverage. The industry supplies more than 8,000 different textile products to the US military, ranging from body armor and ballistic protection to flight suits, parachutes, and medical textiles. That relationship creates a national security argument for maintaining domestic capacity that operates independently of the commercial competitiveness debate. An industry that cannot survive on commercial economics alone can still justify policy support if it underpins military readiness and surge production capability in contingency scenarios.

Customs enforcement was the third pillar of the NCTO’s 2025 agenda, with the organisation pressing for intensified scrutiny of import undervaluation, misclassification, and transshipment schemes that route Chinese-origin goods through free trade agreement partner countries to claim preferential tariff treatment they are not entitled to. This is not a marginal concern. The integrity of the CAFTA-DR and USMCA frameworks depends on whether goods claiming duty-free status actually contain the US-origin inputs those agreements require. Weak enforcement effectively creates a backdoor for subsidised Asian textile inputs to enter the US market at preferential rates.

What are the risks facing the US textile industry as it enters 2026?

The NCTO’s own framing at the annual meeting was candid about the difficulty ahead. The organisation’s primary advocacy objectives for 2026 include maintaining duty-free status for textile and apparel goods eligible under USMCA and CAFTA-DR, obtaining tariff exemptions for textile manufacturing inputs and machinery not produced domestically, and strengthening engagement to protect and extend the Berry Amendment through the National Defense Authorization Act and the House Berry Amendment Caucus.

The tariff policy uncertainty that ran through 2025 created an investment planning problem that partial wins on policy cannot fully resolve. When the durability of any given tariff regime is unclear, whether it applies to CAFTA-DR partners, Chinese goods, or manufacturing machinery, capital allocation decisions are frozen. Facilities that might otherwise be expanded or modernised remain in limbo. The irony is that tariff policy intended to encourage domestic manufacturing can simultaneously depress domestic investment if its implementation is erratic or reversible on short notice.

The plant closure data sharpens that concern. More than 40 facilities shuttered in two and a half years is not the profile of an industry confidently investing in reshored capacity. It is the profile of an industry absorbing structural decline while hoping policy catches up quickly enough to change the trajectory. The NCTO’s wins on de minimis, USMCA exemptions, and defense procurement are real and material. Whether they arrive in time, and at sufficient scale, to arrest the facility closure trend is the question that 2026 will begin to answer.

Key takeaways on what the NCTO’s 2025 industry overview means for US textile manufacturers, trade policy, and the broader supply chain

• The US textile and apparel supply chain generated $60.9 billion in output in 2025, down from $63.9 billion in 2024, with employment contracting to approximately 453,000 workers from a prior-year high of 471,000.
• More than 40 US textile facilities closed in roughly two and a half years, a structural deterioration that the headline output stability figure does not adequately reflect.
• The closure of the de minimis loophole effective 29 August 2025 removed a mechanism estimated to have channelled approximately half of all low-value duty-free US imports into textile and apparel products, representing a structural competitive relief for domestic producers.
• Legislative moves in the Senate and House reconciliation packages to make the de minimis closure permanent by 1 July 2027 provide a statutory backstop, but enactment is not yet complete and political risk remains.
• USMCA tariff exemptions preserved the $20 billion two-way trade relationship with Mexico and Canada that underpins 53 percent of total US textile exports; CAFTA-DR exemption status remains contested and is a priority advocacy objective for 2026.
• The Western Hemisphere co-production architecture, spanning USMCA and CAFTA-DR partners, supports 2.6 million jobs and $34 billion in annual two-way trade and serves as the principal alternative to China-dominated Asian supply chains.
• Berry Amendment protections and Make PPE in America Act enforcement represent the defense procurement dimension of NCTO advocacy, anchoring a national security justification for maintaining domestic textile capacity beyond commercial economics.
• Tariff policy uncertainty continued to suppress investment planning and facility expansion decisions through 2025, partially offsetting the positive signals from de minimis closure and USMCA preservation.
• NCTO’s 2026 agenda centres on securing tariff exemptions for textile manufacturing inputs and machinery not made domestically, a targeted relief that would lower production costs without undermining the broader import protection framework.
• The industry’s trajectory in 2026 depends on whether policy wins accumulate fast enough and with enough durability to reverse the facility closure trend and restore investment confidence among domestic manufacturers.