In May 2026, China's national textile and apparel market sentiment indices both fell below the 50 threshold. The manager index dropped to 49.35, down 1.46 percentage points from April, while the merchant index slightly rose to 49.73, just 0.02 points higher. Both below 50—the dividing line between contraction and expansion—signal a clear demand slowdown across the distribution chain.
Market Data Shows Broad Weakness
Among manager sub-indices, the business volume index fell to 49.03, down 1.62 points; logistics and foot traffic indices both dropped 2.26 points to 48.39. These three core indicators simultaneously falling below 50 indicate shrinking transaction activity in professional markets. The store opening rate index rose 1.61 points to 49.03 but remained below threshold, suggesting vacancy rates improved but far from recovery.
Merchant-side data is equally concerning. Sales volume index stood at 49.11, down 0.48 points; profit index fell to 48.97, down 0.48 points; average selling price index edged up 0.68 points to 49.52 but stayed below 50. This shows merchants lack pricing power, with profit margins further compressed. Inventory index dropped to 49.79, below threshold, indicating rising inventory pressure. A notable signal is the comprehensive cost index rising to 50.82, up 1.64 points, meaning raw material and labor cost pressures have eased slightly—likely a lagged reflection of upstream price corrections.
E-commerce Growth Slows Alongside Foot Traffic Decline
E-commerce sales indices for managers plunged from 54.19 in April to 50.97, down 3.22 points; merchant index also fell 0.75 points to 50.14. Though both remain above 50, growth has clearly decelerated. This data suggests e-commerce failed to offset offline foot traffic declines in May. Combined with the logistics index decline, it points to overall weak end-consumer demand rather than mere channel shifts.
The monitoring sample covers 31 professional markets including Guangzhou, Shandong Jimo, Jiangsu Dieshiqiao, Shanghai, and Liaoning Xiliu, spanning apparel, fabric, home textiles, and general merchandise. These markets are industry capillaries, and their weakening directly signals order contraction. For fabric and home textiles as midstream categories, order fluctuations typically lead apparel retail by 1-2 months. May's weakness may foreshadow further slowdown in apparel company procurement during June-July.
Forward-Looking Indices vs. Business Sentiment
Despite weak actual data, all forward-looking indices remain above 50. Manager forward index is 53.23, forward business environment index 52.90; merchant forward index 50.14, forward business environment index 50.07. This divergence between weak reality and strong expectations is common in textile monitoring. Optimism often relies on seasonal restocking and export order recovery assumptions. However, with rising inventory pressure, if June orders fail to materialize, forward indices face significant downside risk.
From an export perspective, May data doesn't separate domestic and foreign sales, but the logistics index drop suggests export orders may also be under pressure. Given ongoing destocking cycles in major global markets, textile exporters should remain cautious about H2 orders.