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Supply Chain
Argentina Textile Industry Runs at 24% Capacity as Imports Surge and Output Hits Nine-Year Low
Argentina’s textile industry is posting some of its weakest readings in years, as a surge in imported finished garments coincides with a steep drop in domestic output and capacity use, industry groups said.
The textile industrial production index fell 23.9% year on year in January, the lowest level in the available series dating back to 2016, according to a March report by the Argentine Textile Industries Federation (FITA). FITA said the decline was driven by drops of more than 30% in segments such as “fabrics and finishing” and “cotton yarns,” contrasting with a milder 3.2% decline in overall manufacturing.
The downturn has been building. The Pro Tejer Foundation’s economic bulletin said textile production was down 27.8% compared with two years earlier. Capacity use underscores the contraction: in January 2026, the sector operated at just 24% of its productive potential, far below the economy-wide industrial average of 53.6%, according to the same sources.
Industry groups said the slump is also showing up in employment. Textiles, apparel, leather, and footwear shed 12,000 formal jobs over the past year, totaling 100,000 positions as of December 2025, they said. Since late 2023, the accumulated losses have exceeded 20,000 jobs, and Pro Tejer said the sector posted the largest percentage employment decline across Argentina’s private economy.
The deterioration at home has unfolded alongside fast growth in online retail. Argentina’s e-commerce market expanded 55% in 2025, outpacing inflation of 31.5%, industry data cited in the reports showed. But the growth has been increasingly driven by purchases from abroad, a trend that now includes 47% of online shoppers, according to the latest annual e-commerce study by the Argentine Chamber of E-Commerce (CACE) and Kantar.
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In that survey, Temu was the most used platform among consumers who buy from overseas, at 41%, followed by Shein at 31%, ahead of traditional players such as Amazon, the study showed.
Local brands have felt the shift in demand, industry sources said. E-commerce platform Tiendanube reported nominal revenue for non-sports apparel fell 14%, which it linked in large part to the rise of Chinese platforms. The Observatorio Pyme Foundation said 88% of small and mid-sized firms in the segment cited falling sales as their main problem, while 68.4% said they faced an “import threat,” the highest reading across industrial sectors.
Imports: finished goods up, production inputs down Foreign trade data points to a structural split. FITA said imports of final products, particularly clothing, rose 54% in volume and 27% in value in February. Over the first two months of the year, imports of finished apparel jumped 82% in tonnes and 53% in dollars, it said.
Datamar container movement data reveals a 39% surge in inbound TEU volumes within Argentina’s fabric garments during January and February of 2026.
Local brands have felt the shift in demand, industry sources said. E-commerce platform Tiendanube reported nominal revenue for non-sports apparel fell 14%, which it linked in large part to the rise of Chinese platforms. The Observatorio Pyme Foundation said 88% of small and mid-sized firms in the segment cited falling sales as their main problem, while 68.4% said they faced an “import threat,” the highest reading across industrial sectors.
Imports: finished goods up, production inputs down Foreign trade data points to a structural split. FITA said imports of final products, particularly clothing, rose 54% in volume and 27% in value in February. Over the first two months of the year, imports of finished apparel jumped 82% in tonnes and 53% in dollars, it said.
Datamar container movement data reveals a 39% surge in inbound TEU volumes within Argentina’s fabric garments during January and February of 2026.