The Producer Price Index (PPI) data released by the National Bureau of Statistics on July 9, 2026, reveals a rare 'scissors gap' in the textile industry chain: upstream raw material purchase prices rose over 3% year-on-year, with some chemical and energy raw materials surging more than 11%, while downstream garment and home textile ex-factory prices moved in the opposite direction. This severe divergence between cost and selling prices means textile manufacturers are absorbing ever-rising raw material and energy costs on their own.
Cost Side: Three Key Segments Surge
On the procurement side, textile enterprises face cost pressure from three core directions. The purchase price of textile raw materials rose 3.3% year-on-year, with month-on-month growth of 0.7%, driven by firm prices for chemical fibers, cotton, and recycled fiber materials. Chemical raw material purchase prices surged 11.5% year-on-year, directly pushing up production costs for polyester, nylon, textile auxiliaries, and functional coating materials, hitting chemical fiber spinning and dyeing and finishing processes hard. Fuel and power purchase prices increased 11.8% year-on-year, meaning higher electricity and coal costs for energy-intensive processes like weaving, dyeing, and drying.
Notably, while the month-on-month increases for these three cost items have narrowed, year-on-year levels remain elevated. Industry data indicates that high international commodity prices, especially for crude oil, non-ferrous metals, and coal, continue to transmit through chemical, fiber, and energy intermediates to textile manufacturing.
Selling Side: Terminal Market Unable to Absorb Price Hikes
In stark contrast to the hot cost side, downstream finished product ex-factory prices showed an overall weakening trend. National PPI data shows that the overall price of consumer goods fell 0.9% year-on-year, with apparel ex-factory prices dropping 1.0% year-on-year. This means that while raw material, chemical, and energy costs are all rising, ex-factory prices for garments, home textiles, and footwear are actually falling.
Behind this contradiction lies the structural characteristics of the terminal consumer market. The current domestic apparel and home textile market is well-supplied, with intense competition among brands and channels, making it difficult to raise retail prices. This directly prevents manufacturers from passing on rising costs downstream. The price transmission mechanism along the industry chain has clearly fractured, making the manufacturing segment the primary bearer of cost pressure.
Industry Impact: Profit Margins Continue to Narrow
Looking at the structural PPI data, the price of means of production rose 5.5% year-on-year, the core driver of overall PPI growth. Within this, the mining industry surged 16.5%, raw materials industry rose 8.6%, and processing industry increased 3.0%. The widening gap between means of production and consumer goods prices indicates a continuing imbalance in profit distribution between upstream resource industries and downstream manufacturing.
For textile manufacturers, profitability in segments such as chemical fiber, spinning, dyeing, and footwear is under dual pressure. On one hand, raw material and energy costs are rigidly rising; on the other, there is no room to raise ex-factory prices. Relying solely on order volume and internal cost reduction is no longer sufficient to offset the continuous cost escalation. Industry data shows that profit growth in the textile sector has slowed significantly in the first half of the year, with some small and medium-sized weaving and dyeing enterprises even facing losses.
Medium-to-Long Term Response: From Cost Management to Value Reconstruction
In the short term, enterprises can alleviate cost pressure by optimizing procurement timing, improving energy efficiency, and adjusting product mix. However, from a medium-to-long term perspective, this round of cost pressure is accelerating structural adjustment in the textile industry.
In major industrial clusters such as Keqiao, Shengsze, and Nantong, some enterprises have begun accelerating their transition toward differentiated functional fabrics, high-end specialty fibers, and green low-carbon processes. These high value-added products have stronger pricing power in the terminal market and can partially absorb upstream raw material price increases.
Meanwhile, peak summer energy demand has further raised coal and electricity costs, forcing enterprises to accelerate energy-saving retrofits and distributed energy deployment such as solar photovoltaics. For export-oriented companies, growing overseas market attention to sustainable supply chains means green low-carbon processes are not just a response to cost pressure but may become a prerequisite for winning orders.