The technical textile industry delivered a 'stable but divergent' report card for the first five months of 2026. Value-added output of enterprises above designated size maintained medium-speed growth, but profit performance varied sharply across sub-sectors, while export structure shifted from volume growth to quality improvement.
Output Accelerates, Nonwovens Lead
According to the National Bureau of Statistics, nonwoven fabric output from enterprises above designated size 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 accelerating by 3.4 percentage points. This indicates recovering demand in medical, filtration, and construction sectors. Nonwovens, as the core category, are benefiting from sustained volume growth in hygiene products and industrial wipes.
Revenue improved: industry operating income turned positive, up 1.7% year-on-year. Total profit narrowed its decline to 3%, with an operating profit margin of 3.6%, down only 0.2 percentage points. Overall profitability showed strong resilience under macro pressure, but not all sub-sectors recovered equally.
Profit Divergence: Nonwovens Strengthen, Traditional Segments Struggle
The nonwoven fabric sector was the brightest spot: revenue up 2.5%, profit surging 9.9%, and operating profit margin improving to 2.7%. Profit growth far outpaced revenue growth, suggesting cost control or product structure upgrades. In contrast, the rope, cord, and cable sector saw profit drop 9.7%, with an operating margin of only 3%, reflecting weak pricing power for low-value-added products.
The tarpaulin and canvas sector grew revenue by 8.5% but saw profit fall 5.7%, though its 4.2% margin remained high. The textile belt and tire cord sector experienced declines in both revenue (-4.1%) and profit (-2.4%). Other technical textiles (e.g., construction and protective textiles) saw slight revenue growth of 0.2% but a sharp 11.5% profit drop, with a 5% operating margin—the highest in the industry—but volatile earnings.
Exports Steady, Structure Shifts to Higher Value
China Customs data shows technical textile exports reached $18.81 billion from January to May, up 5.3% year-on-year. Imports were $2.28 billion, up 3.1%, widening the trade surplus. Category structural changes are noteworthy:
- Coated industrial fabrics: $2.19 billion, up 1% (still the largest category)
- Nonwovens: $1.93 billion, up 10.7%; volume 770,000 tons, up 13.4%
- Absorbent textiles (diapers, sanitary napkins): $1.76 billion, up 10.7%
- Wet wipes: $490 million, up 14.7% (fastest growth)
- Industrial glass fiber products: $1.02 billion, up 12.2%
More categories are seeing export value growth exceeding volume growth, indicating rising unit prices or product value. Exports to top three destinations—USA ($2.21 billion, +3.5%), Vietnam ($1.48 billion, +8.3%), and Japan ($940 million, +0.9%)—all grew. Exports to Belt and Road countries reached $11.34 billion, up 5.5%, accounting for about 60% of total, showing emerging markets as new growth poles.
Cost Relief: Oil Prices Fall, Chemical Fiber Weakens
In June 2026, international oil prices dropped sharply amid eased Middle East tensions, improved Strait of Hormuz navigation, and planned output increases by Iraq and others. Polyester, nylon filament, and polypropylene prices trended lower. As geopolitical premiums fade, the chemical fiber market is returning to supply-demand fundamentals, which should ease raw material cost pressure for technical textiles in H2 and help repair profits.