The June 2026 sentiment indices for China's textile and garment professional markets paint a complex picture. While the headline figures for both managers and merchants showed a month-on-month rise, the sub-indices reveal a structural divergence within the market. The manager sentiment index stood at 49.78, up 0.43 points from May, while the merchant sentiment index reached 50.07, up 0.34 points. Behind these numbers lies a tug-of-war between recovering footfall and rising costs, as well as a clear signal of the shifting balance between traditional and e-commerce channels.
Footfall and Logistics Recover, but Merchant Margins Shrink
In June, market operations showed clear signs of recovery. Among the manager sub-indices, the logistics dispatch volume index and the footfall index both rose by 0.64 points from the previous month to 49.03. The store opening rate index also increased by 0.32 points to 49.35. These indicators suggest that physical market activity picked up as summer began. However, the total business volume index remained flat, indicating that the increased traffic did not fully translate into higher transaction volumes.
Data from the merchant side reveals more pressure on the front line. While the sales volume index rebounded into expansion territory at 50.14, the average selling price index fell 0.22 points to 49.30, and the profit index stood at 49.86, both below the boom-or-bust line of 50. More notably, 19.58% of merchants reported declining profits, a sharp increase of 8.62 percentage points from May, and 18.88% saw lower selling prices, an increase of 12.03 percentage points. This suggests that merchants are cutting prices to drive sales, squeezing profit margins.
Rising Costs and Inventory Reduction
Cost pressure was a key challenge for merchants in June. The comprehensive cost index was 50.63, down 0.19 points from the previous month, indicating a marginal increase in cost pressure. Specifically, 6.99% of merchants experienced higher operating costs, compared to none in May, showing a rapid spread of cost increases. Meanwhile, the inventory index rose 0.21 points to 50.00, with 10.49% of merchants reducing inventory, signaling some relief in stock pressure. This reflects a strategy of discounting to clear inventory, at the expense of profitability.
For buyers, this period may offer bargaining power on fabric and garment prices. However, rising upstream costs for materials like polyester and cotton could eventually reverse this trend.
E-commerce Acts as a Stabilizer
The most positive signal in June came from e-commerce sales. The manager e-commerce sales index rose 0.64 points to 51.61, while the merchant e-commerce sales index climbed 0.35 points to 50.49. Both indices remained above the boom-or-bust line, with a clear upward trend. Notably, 9.79% of merchants reported increased online sales, a jump of 8.42 percentage points from May.
This indicates that e-commerce has become a vital supplement for merchants in maintaining sales volumes, especially as physical store traffic recovers slowly. For clusters like Keqiao and Shengze, live-streaming and mini-program orders are shifting from optional to essential. The forward-looking indices for both managers and merchants remained above 50, reflecting industry confidence in a short-term recovery.