Raw materials are rising while fabrics are falling — that is the most telling divergence in Keqiao's textile hub as the September peak season window opens. Public industry data shows the latest textile price index at 106.68 points, down 0.25% month on month, while the raw material sub-index rose 0.18% to 94.40 points. The two numbers point in opposite directions, meaning cost pressure is not being passed downstream smoothly and margins in the middle of the chain are being squeezed from both ends.
The Cost Transmission Dilemma Behind the Price Divergence
The polyester chain is the main driver of this upward move. Higher PTA and ethylene glycol prices have pushed polyester yarn quotes steadily higher, with spot deals increasingly negotiated case by case and quote validity periods visibly shortening. The cotton yarn market followed with modest gains, with 32S carded yarn holding near 25,100 yuan per tonne as high cotton prices provided cost support. Viscose yarn, by contrast, remained weak with a wait-and-see mood, and internal divergence within the yarn market is now pronounced.
The problem is that while spinning mills can pass on frequent upstream quote changes, weaving and fabric mills face budgets locked in by brand clients. Room to raise fabric quotes is limited, resistance to cost pass-through is growing, and the middle segment can only absorb the difference. For buyers, this means supplier pricing flexibility is narrowing and the bargaining room of previous years is no longer available.
Grey fabric prices and volumes fell month on month, and divergence across apparel fabric categories widened further. Plain cotton and ordinary polyester-cotton commodity fabrics traded quietly, with homogeneous grey goods trapped in low-price competition and thin margins. Wool blends and differentiated synthetic fabrics, however, saw firmer enquiries and shipments, and products with distinctive textures or special blend ratios clearly command stronger pricing power.
Order Fragmentation Is Reshaping Supply-Demand Relations
This September did not bring a full-blown boom; structural recovery is the more accurate description. Autumn-winter consumption lifted demand for thick blends, small-texture and lightweight functional fabrics, but the shape of orders has changed: domestic womenswear brands and e-commerce clients now favour small-batch quick-response runs, large orders are shrinking, and most customers place trial orders first before adding volume once market feedback is positive.
This fragmentation directly challenges factory scheduling logic. The old model of spreading costs over a single large order is hard to sustain, and sampling cycles and delivery efficiency have become the key to winning follow-up orders. The home textile segment is stable, and export orders have recovered somewhat, but overseas buyers are highly sensitive to raw material volatility, strict on price, and have not relaxed payment terms or inspection standards.
Upstream players are diverging in their responses. Some mills are locking in prices in batches to avoid inventory risk from violent raw material swings, and strengthening coordination with upstream spinners to prioritise differentiated blended yarns. On the product side, development is moving earlier in the process, with stores displaying yarn samples alongside finished garment samples in an attempt to offer clients complete fabric solutions rather than simply selling greige goods.
Forward Variables and Structural Opportunities
The core variables ahead remain raw material prices and end-consumer demand. If chemical fibre prices stay high, cost pressure on fabric mills will persist; only sustained autumn-winter consumption and brand replenishment can open further growth space. The industry is likely to remain in a structural market, with commodity categories facing intensifying pressure and companies with differentiated products and fast response capabilities standing out.
For all links in the chain, the volume-driven model is fading. Starting from yarn and moving upward into fabric development while improving customer service downward is becoming the mainstream path for Keqiao mills. Buyers need to reassess suppliers' development capability rather than compare unit prices alone; factories need to turn sampling and delivery efficiency into quantifiable competitive advantages.