June Textile Market Sentiment Index Rebounds, Merchant Profit Pressure Remains

In June 2026, the sentiment index for China's textile and apparel professional markets showed a month-on-month rebound, but the recovery in merchant profitability lagged significantly behind the improvement in footfall and logistics. Data from the China National Textile and Apparel Council (CNTAC) Circulation Branch showed that the manager sentiment index rose to 49.78, up 0.43 percentage points from the previous month, while the merchant sentiment index increased to 50.07, up 0.34 percentage points. Although both indices remain at low levels, the directional change warrants attention.

Footfall and Logistics Recovery Indicate Market Stabilization

Looking at sub-indices from the manager side, the market operating environment saw tangible improvement in June. The logistics volume index and footfall index both rose by 0.64 percentage points month-on-month, while the store opening rate index increased by 0.32 percentage points. 77.42% of professional markets reported total operating revenue unchanged from the previous month, with no widespread decline. This suggests that after several months of weakness, offline trading activity in textile and apparel markets is bottoming out and recovering. The increase in footfall is particularly encouraging for wholesale businesses that rely on on-site sampling and negotiation.

Merchants Face Squeeze from Prices and Costs

In contrast to the relatively optimistic data from the market management side, the operational quality on the merchant side did not improve in tandem. In June, the average selling price index for merchants was 49.30, down 0.22 percentage points from the previous month and remaining below the 50-point boom-bust line for several consecutive months. The profit index stood at 49.86, up 0.89 percentage points but still below the threshold. Meanwhile, the comprehensive cost index fell by 0.19 percentage points, indicating rising cost pressure for merchants. 19.58% of merchants reported a decrease in profits, and 18.88% reported a decline in selling prices, suggesting that end-demand is highly price-sensitive, making it difficult for merchants to pass on higher costs downstream.

E-commerce Offsets Offline Risks, Inventory Pressure Eases Marginally

A notable bright spot in the June data is e-commerce sales. The manager e-commerce sales index was 51.61, up 0.64 percentage points from the previous month, while the merchant e-commerce sales index was 50.49, up 0.35 percentage points. 22.58% of professional markets and 9.79% of merchants reported an increase in e-commerce sales. This indicates that professional market merchants are accelerating their online transformation, and e-commerce channels are becoming an important tool to offset fluctuations in offline footfall. Additionally, the inventory index stood at 50.00, up 0.21 percentage points, suggesting that overall inventory pressure has eased slightly, providing merchants with room for future restocking.

Forecast Indices Reveal Confidence Divergence, Structural Opportunities in July

Looking at forecast indices, expectations for July diverged between managers and merchants. The manager forecast index for the next period was 50.32, down 2.91 percentage points from the previous month, while the merchant forecast index was 50.84, up 0.70 percentage points. Managers appear more cautious, possibly due to concerns about the macroeconomy and the pace of consumption recovery. Merchants' increased confidence is more likely based on marginal improvements in actual shipment volumes. All four forecast indices remain above 50, indicating that overall market expectations are still positive.

For Buyers - Current merchant bargaining power is limited, with the average selling price index below 50. This is a good time for bulk procurement negotiations to lock in low-cost inventory. - Focus on merchants with active e-commerce channels. They tend to have faster inventory turnover and higher new product update frequency, making them reliable supply sources. - While July forecast indices are positive, avoid overstocking. Prioritize suppliers that support small batches and high-frequency deliveries.

For Foreign Trade Enterprises - The domestic market recovery may drive demand for some fabrics and accessories. Consider contacting merchants in professional markets early for samples. - For factories with a growing share of e-commerce sales, optimize small-order, quick-response capabilities to adapt to the fragmented order trend in the domestic market. - With rental indices stable (93.55% of markets reported unchanged rents), offline exhibition costs are manageable. Consider setting up sample rooms in key markets.