June Textile Market Sentiment Rebounds: Merchant Confidence Recovers but Cost and Price Pressures Persist

In June 2026, the sentiment index for national textile and apparel professional markets showed signs of a recovery. According to monitoring data from the China National Textile and Apparel Council's Circulation Branch, the manager sentiment index stood at 49.78, up 0.43 percentage points from May. The merchant sentiment index returned above the boom-bust line, recording 50.07, a month-on-month increase of 0.34 percentage points. This data indicates a slow but steady improvement in overall business sentiment after earlier adjustments.

Market Operations Recover: Foot Traffic and Store Opening Rates Rise

Looking at specific operational indicators, the professional markets showed clear recovery characteristics in June. The logistics dispatch volume index rose by 0.64 percentage points to 49.03, while the foot traffic index also increased by 0.64 points to 49.03. More notably, the store opening rate index climbed by 0.32 points to 49.35, with the proportion of markets reporting increased store openings jumping from 0% to 6.45%. Meanwhile, the share of markets with declining foot traffic fell by 6.45 points. This suggests that the physical operational vitality of professional markets is recovering, with both merchants' willingness to operate and consumers' willingness to visit stores strengthening. The rental index remained stable at 50.65 in expansion territory, indicating that the property side of the market is operating relatively smoothly, without widespread vacancies or aggressive rent cuts.

Merchant Operations Under Pressure: Price and Profit Challenges

Despite the overall improvement in market sentiment, pressure on merchants has not completely dissipated. While the merchant sentiment index crossed the 50 threshold, sub-indices reveal structural concerns. The average selling price index was 49.30, down 0.22 points from May, with 18.88% of merchants reporting price declines—a sharp increase of 12.03 points month-on-month. The profit index stood at 49.86, up 0.89 points from the previous month but still in contraction territory, with 19.58% of merchants reporting reduced profits, an increase of 8.62 points. This indicates that amid still-fragile terminal demand recovery, merchants are facing a 'volume growth without profit growth' dilemma, with low-price competition or voluntary price cuts continuing to erode margins.

Cost and Inventory: New Signals of Pressure Transfer

Changes on the cost side also warrant industry attention. In June, the comprehensive cost index was 50.63, down 0.19 points from May, while the proportion of merchants reporting increased operating costs jumped from 0% to 6.99%. A cost index above 50 typically means easing cost pressure, but this slight decline hints at emerging cost pressures. This may be related to fluctuations in some raw material prices, adjustments in logistics costs, or rising labor expenses. Meanwhile, the inventory index was 50.00, up 0.21 points from May, with the share of merchants reporting reduced inventory increasing by 8.44 points. While inventory pressure has eased somewhat, rising cost pressure is becoming a new constraint. For buyers and factories, this means future bargaining space may narrow, and cost transmission along the supply chain will become more sensitive.

E-commerce: A Stabilizer for Sentiment Recovery

While physical channels recover slowly, e-commerce sales continue to act as a stabilizer. In June, the manager e-commerce sales index was 51.61, up 0.64 points month-on-month; the merchant e-commerce sales index was 50.49, up 0.35 points. Both indices remained firmly above the boom-bust line, and the proportions of managers and merchants reporting increased e-commerce sales rose by 6.45 and 8.42 points, respectively. This indicates that online-offline integration has become a core tool for professional market merchants to hedge against fluctuations in offline foot traffic. For merchants relying on traditional wholesale channels, strengthening e-commerce capabilities is no longer an option but a necessary configuration to maintain sentiment levels.

Forward-Looking Indices: Confidence Repairing but Cautious Optimism Needed

Looking at forward-looking indices, short-term confidence among market participants is recovering. Managers' expectation index for July was 50.32, with a business environment expectation of 50.97; merchants' corresponding indices were both 50.84. Although managers' expectation indices fell month-on-month, all four forward-looking indices were above the 50 boom-bust line, indicating that the industry is cautiously optimistic about the July market. However, given the weakness in average selling price and profit indicators, this confidence is more based on 'volume' recovery rather than 'price' improvement.

For Buyers - Monitor signs of rising merchant costs and consider locking in long-term contract orders or phased purchasing to avoid being forced to accept price increases during peak seasons. - Use e-commerce channel data to supplement offline procurement decisions, prioritizing suppliers with consistently strong e-commerce sales indices, as they typically have better inventory turnover and price competitiveness.

For Foreign Trade Enterprises - With domestic market prices under pressure, foreign trade firms can focus on overseas demand for cost-effective products, leveraging domestic cost advantages for differentiated pricing. - Track professional market foot traffic and store opening rate data as leading indicators of domestic demand recovery, allowing for timely adjustment of strategies for shifting from export to domestic sales.