In the vast Russian territory, the textile industry, as an indispensable industry, plays an important role in connecting the past and the future.

Crisis and business opportunity

After the collapse of the Soviet Union, the Russian textile and clothing industry declined sharply, which began to improve only after the 1998 financial crisis, but its level of development is still not high.The annual output value is about 10 billion US dollars, which can only meet 15%-20% of the domestic market demand. This provides foreign enterprises with great market opportunities and space for expansion.

In recent years, the decline of the Russian textile industry has become more obvious, and the production capacity of textiles and clothing is insufficient to meet the demand of the domestic market,and low productivity has led to a trade deficit.

Since the war between Russia and Ukraine, a large number of well-known clothing brands in Europe and the United States have withdrawn from the Russian market. In view of the reality,the Russian government said that it will vigorously promote the local textile and clothing manufacturing, as far as possible to reduce dependence on imports.

The Russian government is currently implementing import substitution policies, actively supporting local textile and garment producers, and providing subsidies and concessions.

Current situation of textile and clothing industry

After the collapse of the Soviet Union, the Russian textile and clothing industry declined sharply. Due to the emphasis on heavy industry in the Soviet period, the development of light industry did not get enough attention,and the textile and clothing industry was mainly concentrated on Belarus and the Baltic States, the overall output of the Russian textile and clothing industry declined by more than 10 times after the collapse of the Soviet Union.

The equipment of Russian textile enterprises is basically the equipment of the former Soviet Union period, which is composed of former Soviet Union products (some pre-spinning equipment and gripper looms),Eastern European products (air spinning, etc.) and European products (spinning, printing and dyeing, etc.). Some companies have adopted new spinning, weaving or post-finishing machinery made in Europe.Some of China's textile machinery products are also exported to Russia.

The Russian textile and clothing market is still a potential stock. Russia's textile industry is an important part of the domestic economy, and although it may not be as visible on a global scale as some other countries,it still plays an important role in the domestic market.

Market potential

The Russian market has a large demand for textiles, with annual consumption of all types of textiles of about $17 billion and clothing consumption of about $36 billion. According to Russian official statistics,the Russian clothing market consumes 4.8 billion square meters of cotton cloth every year, 900 million square meters of silk, 600 million pairs of socks, 6.3 billion pairs of shoes,and also needs a large number of clothing and pillow towels, bath towels, bedding and other household textiles.

Russia's consumption of textiles and clothing, in addition to relying on supermarkets, department stores, clothing stores, the wholesale market of a variety of fabrics, accessories and clothing is an important placeof consumption for Russian dealers and ordinary residents.

Because the Russian textile industry has been depressed for a long time, domestic goods cannot meet its market demand, and the degree of dependence on imports is greater.In addition to cotton cloth and pure wool fabrics and some industrial textiles, other daily textiles such as silk weaving, artificial silk, curtain fabric are mainly imported from China, Southeast Asia and Turkey by the profiteer trade.

According to statistics released by the General Administration of Customs of China, the trade volume between China and Russia in the whole year of 2023 was 240.112 billion U.S. dollars, with an increase of 26.3% year on year.Among them, China's exports to Russia reached US $110.972 billion, up by 46.9%; China's imports from Russia reached US $129.14 billion, up by 12.7%.

The far-reaching impact of the Russo-Ukrainian War on the textile industry

Since the Russian-Ukrainian war, textile imports from Ukraine have almost disappeared, forcing the Russian light industry sector to pay attention to the independent production of textiles.

In addition, the Russo-Ukrainian war has also led to an imminent shortage of merchant shipping officers, and the global supply chain may be at risk of disruption.Russian seafarers make up more than 10 percent of the global workforce of 1.89 million, while Ukraine provides 4 percent, but most Ukrainians are highly trained officers.Under martial law, Ukraine bans men between the ages of 18 and 60 from leaving the country. Maritime headhunters say some seafarers are staying home to fight or reunite with their families.Fighting in Ukraine's port area has raised further concerns, with shipping companies reporting that training at the Odessa Maritime Academy has been suspended.

To sum up, in the short term, the economic sanctions triggered by the Russian-Ukrainian war may lead to a reduction in textile and clothing exports from several major exporters to Russia,and the reduction may be made up by an increase in Chinese exports. However, due to the relatively small proportion of Russia's textile and clothing import demand in the world,the Russian-Ukrainian war is more likely to affect the flow of global trade, and the impact on total demand might be relatively limited. In the long run, the Russian-Ukrainian war has led to a sharp rise in global energy prices,which has also made the global cost of cotton cultivation and textile and clothing processing costs continue to rise, while the problem of insufficient supply of seafarers will continue to exist.From the perspective of the cotton textile industry chain, the Russian-Ukrainian war is more likely to lead to a long-term increase in costs.

However, it is said that new opportunities are produced in times of crisis and new prospects are revealed in times of change. With the European society's economic and technical sanctions on Russia,Russia has to rely on Chinese textile machinery to bring technology and products.

The technological advantages, customization capabilities and rich market experience of Chinese enterprises will help meet the diversified needs of the Russian market. Through cooperation with Russian textile enterprises,Chinese enterprises can provide them with advanced production solutions to help the Russian textile industry continue to grow and develop.