Nonwovens output surged nearly 10% year-on-year, yet the broader technical textiles industry saw total profits drop 3% in the first five months of 2026. The operating profit margin stood at just 3.6%, underscoring a persistent profit squeeze despite rising production.
Divergence Between Output and Profit
According to the National Bureau of Statistics, nonwovens output by above-scale enterprises grew 9.5% year-on-year from January to May, accelerating by 5.6 percentage points from the same period in 2025. Tire cord fabric output rose 3.8%, also 3.4 points faster. However, the profit picture did not keep pace.
Industry-wide revenue edged up 1.7%, reversing a decline, but total profit fell 3%, with the operating margin dropping 0.2 percentage points to 3.6%. This means many firms are producing more but earning less.
Nonwovens was a rare bright spot. Revenue and profit in the sub-sector rose 2.5% and 9.9% respectively, with the operating margin improving 0.2 points to 2.7%. This was driven by higher capacity utilization and export demand.
In contrast, profit in the rope, cordage, and netting segment plunged 9.7%; tarpaulins and canvas saw a 5.7% decline; and other technical textiles (construction, protective fabrics) posted the steepest drop of 11.5%, despite having the highest operating margin of 5%.
Steady Export Growth Led by Nonwovens
Customs data shows exports of technical textiles reached $18.81 billion in the first five months, up 5.3% year-on-year. Imports totaled $2.28 billion, up 3.1%. The widening trade surplus reflects China's global competitiveness in this sector.
Nonwovens exports hit $1.93 billion, up 10.7%, with volume reaching 770,000 tons, up 13.4%. The faster volume growth suggests downward pressure on unit prices.
Coated fabrics remained the largest export category at $2.19 billion, up just 1%. Absorbent textiles (diapers, sanitary napkins) exported $1.76 billion, up 10.7%, while wet wipes surged 14.7% to $490 million.
The top three markets were the U.S. ($2.21 billion, +3.5%), Vietnam ($1.48 billion, +8.3%), and Japan ($940 million, +0.9%). Exports to Belt and Road countries reached $11.34 billion, up 5.5%, accounting for about 60% of total exports.
Raw Material Cost Volatility
In June 2026, international oil prices fell sharply as geopolitical premiums receded. Polyester filament prices weakened, nylon filament stayed soft, and polypropylene prices began a downtrend. Viscose staple fiber fluctuated upward amid conflicting cost support and demand pressure.
The trading logic for chemical fibers is shifting from geopolitics back to supply-demand fundamentals. For technical textile producers, this means greater inventory management challenges. If downstream orders don't pick up, margins will remain under pressure.