The 2026 H1 reports from global chemical giants are more than financial metrics for the textile industry; they serve as a health check of the upstream raw material supply chain. Wanhua Chemical's net profit surged 64.35% year-on-year, while Hengyi Petrochemical, Eastern Shenghong, and Rongsheng Petrochemical saw multi-fold profit increases. In contrast, Lanxess's losses widened and Solvay's revenue and profit declined. This divergence is transmitting through intermediates like PX, MEG, and caprolactam to the cost structures of fabrics and apparel.
Background
According to public financial reports, BASF's Q2 sales reached EUR 17.206 billion, with operating profit soaring 137.1% year-on-year. Ineos, Covestro, and Wacker returned to profitability. In the US, Dow swung to profit, as did Westlake, while Celanese and IFF saw profit declines. Asia stood out: Chinese refining and chemical fiber leaders saw explosive results, Taiwan firms collectively returned to profit, Japan and South Korea mostly posted strong gains, while Saudi SABIC swung to a loss.
Among segments, industrial gases were stable, fertilizers showed polarization, and coating leaders grew steadily. Behind these numbers lie improved chemical spreads and constrained overseas capacity.
Industry Impact
For the textile chain, the most notable trend is the refining-petrochemical integration dividend. Companies like Wanhua, Hengyi, and Eastern Shenghong have connected refining, PX, PTA, and polyester, boosting cost control and supply stability. This implies that future polyester price fluctuations may depend more on integrated firms' operating rates than on crude oil alone. Buyers should assess suppliers' upstream integration when signing long-term contracts to hedge price risks.
Losses or contractions among some European firms could affect the supply of high-end chemical fiber raw materials (e.g., specialty nylon, spandex precursors). Lanxess's widening losses and Solvay's decline may lead to capacity adjustments in specialty chemicals, potentially creating supply gaps or price hikes for differentiated fabric inputs. This is a signal for fabric makers relying on imported high-end materials to plan ahead.
Meanwhile, the profit recovery of giants like Dow and BASF suggests that prices of textile auxiliaries and coating agents may stabilize or rise. Fabric mills should incorporate these changes into cost calculations.