The June 2026 sentiment indices for China's textile and apparel professional markets showed a modest uptick, but the structural divergence beneath the surface deserves closer scrutiny.
Index Rebounds, Profitability Still Under Pressure
According to the latest monitoring by the China National Textile and Apparel Council's Circulation Branch, the manager sentiment index for June stood at 49.78, up 0.43 percentage points month-on-month, while the merchant sentiment index reached 50.07, a 0.34-point increase. Although neither index has surged far above the 50 threshold, the directional change suggests the worst may be over.
Among sub-indicators, the merchant sales volume index rose 1.03 points to 50.14, the largest contributor to the rebound. However, the average selling price index fell 0.22 points to 49.30, and the profit index, while improving 0.89 points, remained below 50 at 49.86. These three figures together reveal a key tension: volume is increasing but at the expense of price. Merchants are trading margin for turnover, squeezing profitability.
Meanwhile, the comprehensive cost index came in at 50.63, down 0.19 points, implying a marginal increase in cost pressure. 6.99% of surveyed merchants reported higher operating costs, up 6.99 percentage points from the previous month. The combination of rising costs and falling prices makes profit recovery a prolonged challenge.
E-commerce Emerges as a Stabilizer
E-commerce sales indices performed notably well in June. The manager e-commerce index rose 0.64 points to 51.61, and the merchant e-commerce index climbed 0.35 points to 50.49, both comfortably above the 50 mark. 22.58% of professional markets reported increased e-commerce sales, up 6.45 percentage points from May; among merchants, 9.79% saw an increase, up 8.42 points.
The resilience of online channels stands out in an otherwise soft season. For traditional wholesale markets, the integration of online and offline is no longer a choice but a necessity. Merchants that had already built digital distribution channels secured more stable orders amid sluggish foot traffic recovery. This also explains why the foot traffic index, despite a 0.64-point increase, remained at 49.03—physical visits have not fully returned, but online transactions are filling the gap.
Inventory Relief and Store Reopening
The inventory index was exactly 50.00, up 0.21 points, with 10.49% of merchants reporting reduced inventory, an 8.44-point increase from the prior month. Easing inventory pressure helps improve merchant cash flow and frees up capacity for next-season stocking. The store opening rate index rose 0.32 points to 49.35, with 6.45% of markets seeing an increase in open stores, up 6.45 points.
These two indicators improving in tandem suggest faster end-market turnover. Inventory clearance and store reopenings form a virtuous cycle: when goods sell, merchants are more willing to keep their doors open; open stores, in turn, drive sales. However, the rent index edged up only 0.33 points to 50.65, with 93.55% of markets keeping rents unchanged—a sign that market operators remain cautious and unwilling to raise costs aggressively.
Forward-Looking Indicators Signal Cautionary Optimism
Looking ahead, the manager forward-looking index reached 50.32, and the merchant forward-looking index hit 50.84, both above 50. Merchants are even more confident about July's business environment than managers, possibly because they feel the marginal improvement in end-demand more directly.
From an industry chain perspective, professional market sentiment typically lags behind upstream weaving and dyeing. The June improvement likely reflects a modest restocking wave in May-June. But with average selling price and profit indices still in contraction territory, the sustainability of this recovery remains to be tested by the July-August off-season data.