From January to August 2021, China's old clothing exports reached 296 million tonnes, with an export value of 3.55 billion yuan, up 102% and 175% respectively from 146 million tonnes and 1.29 billion yuan in the same period of 2020. These latest figures from customs statistics show that waste textile exports are becoming one of the fastest-growing tracks in the circular economy.

Key Points

  • Customs data: In the first eight months of 2021, old clothing exports totaled 296 million tonnes, up 102% year-on-year, with an export value of 3.55 billion yuan, up 175% year-on-year
  • Wang Jincheng, founder of Shandong Chuangxin Clothing Sorting Factory, revealed that about 20% of collected old clothes meet export standards and are shipped to Africa and Southeast Asia, where gauze dresses can sell for around $7 in Africa
  • Tianyancha data shows that as of 2021, there were 52,000 "clothing recycling" related enterprises nationwide, with 10,000 newly registered in the first eight months alone, up 92.3% year-on-year

Export Destinations Mainly in Hot Regions; Summer Clothing Most Profitable

At Shandong Chuangxin Clothing Sorting Factory, workers handle large quantities of recycled clothing packages every day. Factory founder Wang Jincheng told reporters that about 20% of the collected old clothes are exported to African and Southeast Asian countries, while the remaining 80% are sold to downstream factories for regeneration. "A gauze dress can sell for around $7 in Africa. Export trade is currently the most profitable segment in waste textile recycling and disposal," Wang said.

Because the main export regions have hot climates, exported clothing is mainly summer wear. The sorting factory can process 60 to 80 tonnes of a single summer clothing category per day, with monthly summer clothing exports of about 2,000 tonnes and annual output value exceeding 30 million yuan. Recycling prices vary significantly by category: mixed summer clothing (not finely sorted) costs 5,000 to 10,000 yuan per tonne, shoes 4,000 to 8,000 yuan per tonne, other better-quality categories 2,000 to 3,000 yuan per tonne, and poorer quality about 1,700 yuan, with no unified pricing standard in the industry.

Surge in Recycling Enterprises; Shandong Leads

The expansion of the waste textile recycling industry has driven rapid growth in related enterprises. Qichacha data shows that registrations of clothing recycling enterprises grew rapidly in 2016, and annual registrations have exceeded 7,000 since then, reaching 9,000 in 2020, a peak for the past decade; in the first eight months of 2021, 10,000 new enterprises were registered, up 92.3% year-on-year. Geographically, Shandong leads other provinces by a wide margin with 122,000 enterprises, followed by Jiangsu and Guangdong; the top three cities are Guangzhou, Nanning, and Jinan.

The industry has spontaneously formed several specialized recycling centers. For example, Yishui and Weifang in Shandong mainly recycle black material and white cloth for regeneration; Puyang in Henan specializes in purchasing down jackets to process down quilts and other products.

Online Recycling Models Attempt to Solve Low Recovery Rate

Despite large stockpiles of old clothing and increasing recycling channels, the overall recovery rate remains low. National Bureau of Statistics data shows that in 2020, clothing enterprises above designated size in China produced 22.373 billion garments. A report by the Department of Circulation Industry Development of the Ministry of Commerce and the China National Resources Recycling Association shows that in 2018, China recycled about 3.8 million tonnes of waste textiles. At an average of 0.5 kg per garment, only about 30% of waste textiles were recycled.

Industry insider Lin Keyu (pseudonym) analyzed that old clothes have no fixed elimination cycle, and residents' emotional concerns about old clothes plus opaque circulation channels mean that cases of "old clothes kept for ten years" are not uncommon, resulting in a very low overall recovery rate. Wang Jincheng also said the traditional recycling model has a recovery rate of less than 20% to 30%.

To address this challenge, some enterprises have begun exploring an "online platform + partner franchise" model. Wang Jincheng's "Chuangxin Clothing Recycling" mini-program has launched, with monthly recycling volume of about 1,000 tonnes and expected to exceed 4,000 tonnes per month by year-end. Searching "old clothing recycling" on payment platforms yields multiple recycling mini-programs such as Feimayi, Baijingyu, Ouyan, and Dangdang, and the Xianyu second-hand trading platform has also launched related services. Users select the recycling category, address, and estimated weight to schedule door-to-door pickup. Multiple platforms specify that newer winter clothing meeting donation standards is disinfected and passed on to those in need; newer summer clothing is handed to qualified companies for export to Africa and Southeast Asia; renewable cotton products, polyester, etc. are sent to regeneration factories for processing. Some platforms also offer points or product discounts, such as Baijingyu giving 8 points per kilogram of old clothes.

Export and Regeneration Under Pressure at Both Ends; Industry Urgently Needs Regulation

The waste textile industry still faces dual pressures of blocked exports and thin regeneration profits. Wang Jincheng revealed that old clothes are simply sorted without disinfection and directly packaged for sale to Africa, but in 2021, affected by container shortages, shipment rates dropped sharply. If cleaning and disinfection were carried out, the consumption of manpower and materials would be enormous, and wastewater could pollute the environment.

Waste textiles that cannot be exported flow to specialized processing plants, where they are crushed and made into insulation materials for vegetable greenhouses, soundproofing materials, and industrial raw materials. Better-quality items are made into cleaning cloths, labor protection gloves, seat fillings, etc., but profits are significantly lower than direct export, and reprocessing projects require heavy investment in environmental protection facilities, with high environmental risks.

In July 2021, the National Development and Reform Commission issued the "14th Five-Year Plan for Circular Economy Development," proposing to accelerate the construction of a waste materials recycling system, promote classified utilization and centralized disposal of urban waste such as waste textiles, waste plastics, waste paper, waste glass, and kitchen waste, and guide the clustered development of renewable resource processing and utilization projects. Pan Yonggang, vice president and secretary-general of the China National Resources Recycling Association, suggested that the waste textile industry urgently needs policy support, and that parks focused on waste textile recycling could be established in areas with mature conditions to form scale advantages and support large, excellent, and strong enterprises.

Source: Another New Blue Ocean Is Here! Old Clothing Exports Grew Over 100% in the First Eight Months of This Year, a Gauze Dress Exported to Africa Sells for $7 · Originally published on 2021-09-22