5. 2026 Fabric and materials outlook

Next-generation biomaterials move to commercial scale

The fashion industry is poised for a significant shift in its material landscape for 2026, driven primarily by twin imperatives: deepened sustainability and advanced performance integration. Industry forecasts and recent fabric trade show collections, such as the Spring/Summer 2026 (SS26) offerings at Milano Unica and Première Vision, indicated a move away from niche sustainability efforts toward a fully integrated system of bio-based, recycled, and smart textiles in future. Reflecting this transition, the global sustainable fabrics market (which includes clothing, furnishing and medical) is projected to increase its size from an estimated $37.26 billion in 2025 to $41.28 billion in 2026, registering an annual growth rate of over 12 percent during the forecast period of 2026 to 2035 according to Research Nester’s August 2025 ‘Sustainable Fabric Market Forecast’.

Circularity imperative: System change in recycling

The central direction of material innovation for 2026 is the urgent need to transition from relying on waste from other industries—such as recycled polyester from plastic bottles—to developing true textile-to-textile (T2T) closed-loop systems.

The sheer volume of material produced presents the challenge. Textile Exchange chief executive officer, Claire Bergkamp, delivered a sober message at the annual Textile Exchange Conference in Lisbon, Portugal, citing an estimated record 132 million tons of fibres produced globally in 2024. She cautioned that despite the growth in recycled polyester, "We cannot build a circular textile system on another industry’s waste." She added that reliance on these models means the industry is "relying on a shrinking waste source."

This strategic necessity is fueling the push for T2T recycling. The Textile-to-Textile Global Fiber 2030 Project identified 520 T2T recyclers globally. However, the largest hurdle remains effectively collecting and sorting post-consumer textiles. Cyndi Rhoades, chief executive officer and co-founder of UK-based Circle-8 Textile Ecosystems, pointed to the volume and complexity: “There are huge volumes of post-consumer textiles. Very complex mixes, and lots of them. We need a coordinated plan to get to recycling systems.” For these materials to be economically viable for mechanical and chemical recycling, large-scale automated sorting facilities are required to keep costs low.

Brands are also investing in managing their own supply chain waste. Suhas Khandagale, material manager for the global material and components team at Sweden-based H&M Group, explained their system for pre-consumer waste: they provide waste management guidelines to Tier one suppliers, allowing them to “digitally register the waste that they generate and then do the matchmaking and connect that to the recyclers within our network.”

Scaling bio-fabricated and waste-derived alternatives

The industrial scaling of next-generation bio-based materials is challenging the dominance of conventional virgin resources, providing viable alternatives for both luxury and high-performance segments. Mycelium-based leather substitutes, derived from fungi, are crossing into the niche mainstream. The key advantage lies in their low-carbon footprint; MycoWorks, for example, estimates that its Reishi leather emits only around six pounds of carbon dioxide for eleven square feet, significantly less than conventional leather. Plant-based alternatives from pineapple and cactus are also seeing expanded use.

In a direct challenge to the use of animal products, British fashion designer Stella McCartney is pioneering plant-based alternatives. Her SS26 collection featured 'fevvers', faux feathers made from blades of grass. McCartney, who has championed animal-free alternatives for over thirty years, explained the technique: “We grew blades of grass and naturally dyed them and then hand-stitched them onto incredible silhouettes. You get the same effect (as feathers), and you’re not killing billions of birds.” She has also used UPPEAL, an apple-based leather alternative, and Econyl, a recycled nylon manufactured from fishing nets.

While these innovations are proven, scale remains a factor. Fashion author Dana Thomas noted that major luxury corporations such as France-based LVMH and Kering, and Spain-based Zara, need to join the movement, stating that these labels “are not willing to take a chance of buying some fabrics that are better for the planet, but cost more money.”

Reinventing core fibres: Cellulosics and cotton adaptation

Innovation is critically focusing on integrating sustainability into the industry’s high-volume staples, namely viscose and cotton.

The global synthetic viscose fibre market, valued at 19 billion dollars in 2024, is forecast to nearly double to $37.4 billion by 2034 according to Allied Market Research. This growth is contingent upon addressing the environmental concerns of traditional production. The direction is clear: an expansion of closed-loop systems, such as Austrian-based Lenzing AG’s Ecovero brand, and the adoption of recycled cellulose and agricultural waste. This trend is demonstrated by Chinese producer Tangshan Sanyou Xingda Chemical Fiber Co., Ltd.’s partnership with Swedish firm Circulose to commercialise recycled pulp. Furthermore, Lyocell, often known by the Lenzing brand name Tencel, is projected to more than double its market share, driven by its eco-friendly, closed-loop processing.

Meanwhile, cotton, the world’s most widely used natural fibre, must adapt to escalating climate volatility. The World Bank warns that without specific adaptation measures, rising temperatures and erratic rainfall could reduce cotton yields in South Asia by as much as 20 percent by 2050. Sector experts are calling for dedicated adaptation finance to help farmers adopt drought-resistant seed varieties, precision irrigation, and soil-restorative practices.

In terms of market credibility, the Better Cotton Initiative (BCI), which supports over one million farmers, has launched a new traceability label for garments containing at least 30 percent BCI cotton. The organisation is also aligning its standards with regenerative agriculture principles by mid-2026. BCI chief executive, Nick Weatherill, underscored the strategic importance of this development, asserting that in a time of increasing scrutiny, “transparency and accountability are more critical than ever.”

Performance, technology, and the ‘earth-first’ aesthetic

The boundary between fashion and technology is blurring, resulting in the integration of smart and functional textiles. This direction is about providing advanced performance while reducing environmental impact. In synthetics, the focus is on diversifying recycled nylon and developing bio-based alternatives. A new partnership between NILIT and Japan-based Asahi Kasei, for instance, has yielded a bio-based nylon 6.6 yarn and a premium stretch fiber using a biomass balance approach, verified by ISCC+ certification, to reduce reliance on virgin fossil feedstocks.

Smart textiles are also accelerating, featuring integrated sensors and thermoregulatory fabrics that automatically adjust to temperature changes. Performance is also being addressed through low-impact bio-composites, such as Bcomp’s AmpliTex, a hundred percent biocomposite natural fibre fabric, while high-profile applications, such as McCartney’s use of PURE.TECH—a carbon dioxide-absorbing material from a Barcelona-based company—demonstrate the convergence of performance and positive environmental attributes in everyday wear.

The strategic direction is symbolically captured by WGSN and Coloro naming ‘Transformative Teal’ as the colour of the year for Autumn/Winter 2026/27 (AW26/27). The hue, linked to an “Earth-first mindset,” reflects the industry’s need for recovery and regeneration. Sansan Chen, managing director of Coloro, confirmed its commercial readiness, noting that the colour is “a highly achievable colour across all major textile substrates.”

Ultimately, the drive for material innovation is an economic necessity. As Peter Majeranowski, co-founder and chief executive officer of Circ, stated, “Turning waste into a product is great business.” This perspective, echoed by Reju chief executive officer Patrik Frisk on the need to build "economic sense" and resilience into the system, underscores the executive mandate for 2026: to invest strategically in the infrastructure and innovation required for a truly circular, resilient, and high-performance material future.

This 2026 Outlook is based on more that 35 articles, interviews and reports published on FashionUnited. It was written with the help of AI

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