China's technical textiles sector posted a mixed performance in early 2026. Nonwovens led with double-digit growth in both output and exports, while profit margins narrowed across most sub-sectors, signaling mounting cost pressures.
Nonwovens: Dual Engine of Output and Exports
According to the National Bureau of Statistics, output of nonwovens by enterprises above designated size grew 9.5% year-on-year in the first five months of 2026, accelerating 5.6 percentage points from the same period in 2025. Tire cord fabric output rose 3.8% year-on-year, also up 3.4 percentage points.
Export performance was equally strong. Customs data show nonwoven exports reached $1.93 billion, up 10.7% year-on-year, with export volume hitting 770,000 tons, up 13.4%. Absorbent hygiene products (diapers, sanitary napkins) exported $1.76 billion, up 10.7%, while wet wipes exports surged 14.7% to $490 million. These high-growth categories suggest Chinese manufacturers are capitalizing on overseas consumers' shift toward cost-effective alternatives.
Profit Divergence: Revenue Growth Masks Margin Squeeze
Despite a 1.7% year-on-year rise in operating revenue, total profits for above-designated-size enterprises fell 3%, with an operating profit margin of just 3.6%, down 0.2 percentage points.
Segment-wise, nonwovens saw profits jump 9.9% and margins improve to 2.7%, one of the few bright spots. In contrast, ropes and cables profits dropped 9.7%, tarpaulins and canvas fell 5.7%, and construction and protective textiles plunged 11.5%. This divergence highlights structural demand shifts: medical, hygiene, and wiping products remain resilient, while cyclical categories tied to infrastructure and outdoor activities suffer from sluggish global investment.
Export Landscape: US Remains Top Single Market, Emerging Markets Rise
Total exports reached $18.81 billion, up 5.3% year-on-year. The US, Vietnam, and Japan were the top three destinations, with exports of $2.21 billion, $1.48 billion, and $940 million respectively, up 3.5%, 8.3%, and 0.9%.
Notably, exports to Belt and Road countries hit $11.34 billion, up 5.5%, accounting for about 60% of total exports. This signals a shift in export gravity from traditional Western markets to Southeast Asia, Central Asia, and Africa. Coated industrial fabrics remained the largest export category at $2.19 billion but grew only 1%, reflecting intensifying competition in mature segments.
Raw Material Volatility: Geopolitical Premium Fades, Fundamentals Return
In June, international oil prices plunged as tensions eased between the US, Israel, and Iran, the Strait of Hormuz reopened more smoothly, and Iraq planned to accelerate production. This quickly transmitted to the chemical fiber chain: polyester and nylon prices weakened, polypropylene began a downtrend, while viscose staple fiber rose on cost support. The geopolitical premium is rapidly receding.
For technical textile companies, high-cost inventories locked in during the price surge may face impairment losses, but new order cost pressures will ease. Procurement strategies should shift from "hoarding against price hikes" to "just-in-time purchasing," with close monitoring of polyester and polypropylene supply-demand balances.