Nonwoven output growth accelerated by 5.6 percentage points compared to the same period last year, while tire cord fabric growth rose 3.4 percentage points. These signals from China's technical textile sector in the first five months of 2026 contrast sharply with the structural divergence in end demand. According to the National Bureau of Statistics, nonwoven output by above-scale enterprises increased 9.5% year-on-year, and tire cord fabric output grew 3.8%. However, total industry profit still fell 3%, with an operating profit margin of only 3.6%.
The Logic Behind Production Acceleration
The strong growth in nonwovens is primarily driven by exports of absorbent hygiene products and wipes. From January to May, exports of absorbent textiles (diapers, sanitary napkins) reached $1.76 billion, up 10.7%; wet wipes exports grew 14.7%, and wiping cloths rose 4.3%. This end-market demand directly feeds into the nonwoven upstream.
Tire cord fabric output grew 3.8%, but revenue for the textile belts and tire cord fabric sub-sector fell 4.1%, with profit down 2.4%. This contradiction suggests price pressure or cost erosion—higher output did not translate into higher revenue, indicating intensified competition.
Exports: Emerging Markets as Stabilizers
China Customs data shows total technical textile exports reached $18.81 billion, up 5.3%. Exports to Belt and Road countries totaled $11.34 billion, up 5.5%, accounting for about 60% of total exports. This proportion means emerging markets have shifted from a supplementary channel to a core base.
The top three destinations—the US, Vietnam, and Japan—showed divergent growth: Vietnam up 8.3%, the US up 3.5%, and Japan up only 0.9%. Vietnam's growth reflects cross-border textile supply chain shifts, with Chinese technical textiles flowing to Vietnam as intermediate goods for further processing and re-export.
By category, nonwoven exports reached $1.93 billion, up 10.7%, with volume of 770,000 tons, up 13.4%. The volume growth outpacing value growth implies declining unit prices. Technical glass fiber product exports hit $1.02 billion, up 12.2%, one of the fastest-growing segments.
Profit Recovery: Structural Divergence and Cost Pressure
Profit performance varied sharply across sub-sectors:
- Nonwovens: profit up 9.9%, operating margin 2.7%, up 0.2 percentage points
- Tarpaulins and canvas: revenue up 8.5%, but profit down 5.7%, margin 4.2%
- Other technical textiles (construction, protective): revenue up 0.2%, profit down 11.5%, but margin of 5% was the highest in the sector
The margin hierarchy reveals a key insight: higher-value categories (protective, construction) offer the best profitability despite sluggish demand, while volume-driven categories (nonwovens, canvas) face thinner margins. This suggests companies should focus on product mix and pricing power rather than blindly chasing output.
Raw Material Trends: Geopolitical Premium Fades
In June 2026, international oil prices fell sharply as US-Israel-Iran tensions eased, the Strait of Hormuz navigation improved, and Iraq and other producers planned to accelerate output. Polyester and nylon filament prices weakened, while polypropylene fiber prices began a downtrend. The trading logic for chemical fibers is shifting from geopolitical premium to supply-demand fundamentals.
For technical textile firms, lower raw material costs should theoretically improve margins, but the pass-through effect is lagging. Viscose staple fiber prices rose amid conflicting cost support and pressure, indicating diverging trends across different raw materials.