May's national textile and apparel specialized market sentiment index signals a shift: the manager index fell to 49.35, down 1.46 percentage points from April, while the merchant index edged up 0.02 points to 49.73, both below the 50 threshold. This indicates overall market activity has moved from expansion into contraction, as the industry undergoes a phase of adjustment.
Market Operations in Full Contraction
From the manager perspective, May saw a clear decline in market performance. The total turnover index dropped to 49.03, down 1.62 points month-on-month; the logistics volume index and foot traffic index both fell to 48.39, each declining by 2.26 points. These three core indicators simultaneously falling below 50 signal weakening transaction activity. The store opening rate index rose slightly by 1.61 points to 49.03 but remained below 50, reflecting continued reluctance among merchants to open. The rent index fell 0.97 points to 50.32, barely holding in expansion territory but nearing the threshold.
On the merchant side, pressure persists. The sales volume index fell to 49.11, the average selling price index stood at 49.52, and the profit index dropped to 48.97—all in contraction territory. Notably, the profit index declined 0.48 points from April, indicating that even as selling prices recovered (average price index up 0.68 points), it was insufficient to offset losses from lower sales volume. The comprehensive cost index rose 1.64 points to 50.82, crossing the threshold, meaning raw material and labor cost pressures eased for merchants, but this did not translate into profit improvement.
Inventory Risk and Slowing E-commerce Growth
The inventory index fell to 49.79, down 0.55 points from April, dropping below 50 and indicating rising inventory pressure. Meanwhile, the cost index rose and the inventory index fell, forming a 'cost down, inventory up' combination—typical in textiles when downstream demand weakens and goods turnover slows. For fabric and apparel wholesalers, inventory buildup directly ties up capital and increases warehousing and financial costs.
In e-commerce, the manager e-commerce sales index was 50.97, plummeting 3.22 points month-on-month; the merchant e-commerce sales index was 50.14, down 0.75 points. Both remained above 50, but growth clearly decelerated. Data shows only 16.13% of specialized markets saw increased e-commerce sales, a sharp drop of 25.81 points from April; on the merchant side, the proportion with increased e-commerce sales fell to just 1.37%. This suggests the incremental dividend from online channels is weakening, and against a backdrop of insufficient overall demand, e-commerce cannot remain immune.
Optimistic Expectations but Caution Needed
Despite weak actual May data, market expectations for June are not pessimistic. The manager next-period sentiment index stands at 53.23, and the next-period business environment index at 52.90; for merchants, the respective indices are 50.14 and 50.07—all four forecast indices above 50. This indicates practitioners generally view the current downturn as seasonal fluctuation or short-term adjustment, not a long-term reversal.
However, Texcircle believes this optimism should be treated cautiously. From an industry chain perspective, specialized markets sit in the circulation link; their downturn signals to upstream fabric and yarn producers that orders are contracting. If June actual data fails to improve, it could trigger a new round of destocking pressure, impacting raw material prices like chemical fibers and cotton.