The latest sentiment index released by the China National Textile and Apparel Council shows a slight recovery in the overall sentiment of China's textile and apparel professional markets in June 2026, but structural profit pressures remain unresolved. The manager sentiment index rose to 49.78, and the merchant sentiment index reached 50.07, both improving from May. However, a closer look at the data reveals that the market's 'felt temperature' is far less optimistic than the indices suggest.
Market Volume Stabilizes, but Profit Transmission is Blocked
From aggregate indicators, market operations remained largely flat in June. 77.42% of professional markets reported stable total turnover. The logistics dispatch volume index edged up 0.64 percentage points to 49.03, and the foot traffic index also recovered by 0.64 percentage points. These figures suggest that market traffic and logistics are slowly recovering, but this has not translated into merchant profitability.
Merchant-side data reveals a harsher truth: while the sales volume index recovered to 50.14, entering expansion territory, the average selling price index was only 49.30, down 0.22 percentage points from the previous month. The profit index stood at 49.86, up 0.89 percentage points month-on-month but still in contraction territory. This means merchants are seeing volume recovery but continued erosion in price and profit. For fabric and garment merchants relying on wholesale volume, this 'revenue growth without profit growth' scenario is squeezing cash flow.
Costs and Inventory: Pressure and Relief Coexist
Cost-side data deserves attention. In June, 6.99% of merchants reported increased operating costs, up 6.99 percentage points from the previous month. The comprehensive cost index fell to 50.63, down 0.19 percentage points month-on-month. While the index remains above the 50 boom-bust line, the downward trend indicates rising cost pressure. For processing merchants focused on chemical fibers and cotton spinning, raw material price volatility and rising labor costs are the main drivers.
On the inventory front, positive signals emerged. The inventory index was 50.00, up 0.21 percentage points from the previous month, and 10.49% of merchants reported reduced inventory, up 8.44 percentage points from May. This suggests that previously accumulated inventory is being gradually digested, and merchants' inventory management efficiency has improved. For home textile and fabric categories, destocking frees up capital and storage space for autumn-winter stock preparation.
E-commerce: The Only Channel Still Growing
Among all sub-indices, e-commerce sales performance stood out the most. The manager e-commerce sales index was 51.61, up 0.64 percentage points month-on-month, and the merchant e-commerce sales index was 50.49, also in expansion territory. More notably, 22.58% of professional market managers reported increased e-commerce sales, up 6.45 percentage points from the previous month; the proportion on the merchant side also rose by 8.42 percentage points.
This data confirms an industry judgment: the growth engine of traditional textile wholesale markets is shifting from offline stalls to online channels. For merchants in industrial clusters like Keqiao and Shengze, e-commerce is no longer a supplementary channel but a core driver of sales volume maintenance. Live-streaming e-commerce and cross-border B2B platforms, in particular, are changing the distribution pathways for fabrics and garments.
Expectation Divergence: Managers Cautious, Merchants Optimistic
Forward-looking indicators show an interesting divergence. Managers' expectation index for July was 50.32, down 2.91 percentage points from the previous month, and their business environment expectation also fell by 1.93 percentage points. In contrast, merchants' next-period sentiment index was 50.84, up 0.70 percentage points month-on-month, and their business environment expectation also rose by 0.77 percentage points.
This divergence reflects different perspectives: managers focus on macro operational indicators like rent, foot traffic, and store opening rates, leading to caution ahead of the traditional summer low season. Merchants, on the other hand, focus on product sales volume and inventory turnover; the sales volume recovery in June boosted their confidence. For buyers, this expectation gap may mean more flexible price negotiation space in the July market.