Since the beginning of 2026, the RMB has appreciated by 3.3% against the US dollar, setting a new exchange rate high in three years. This round of appreciation has had a structurally differentiated impact on my country’s foreign trade industry, and companies in different tracks have shown an “uneven development” trend.
From the export side, the pressure caused by the appreciation of the RMB is extremely unevenly distributed.
For low-value-added export industries that have thin profits and rely on volume, exchange rate fluctuations directly devour the already fragile profit margins.
According to estimates, every 1% appreciation of the RMB may compress the export profit margins of industries such as textiles and home appliances by 0.5 to 0.8 percentage points.
Many foreign trade companies that use U.S. dollars for settlement and production costs denominated in RMB have experienced significant exchange losses: Fufeng Group, the domestic MSG export leader, incurred exchange losses of 540 million yuan due to the depreciation of the U.S. dollar in the first five months of this year, which directly led to an after-tax loss of about 53 million yuan. Even if product sales remained stable, it could not offset the impact of the exchange rate; Shanghai Silede Company suffered exchange rate losses of more than 5 million yuan in just half a year. The person in charge of the company bluntly said that “cannot be too optimistic” about its operations in the second half of the year.
But for importing companies and industries holding large amounts of US dollar debt, RMB appreciation is a real benefit.
The aviation industry is a typical beneficiary. Since airlines generally have huge US dollar liabilities for purchasing and leasing aircraft, exchange gains directly drive down financial costs. In the first quarter of this year, China Airlines’ financial expenses decreased by 34.64% year-on-year. The core contribution came from the substantial increase in net exchange income.
Enterprises that rely on imported raw materials have also benefited significantly. Rongsheng Petrochemical, a leading domestic refining and chemical company, has effectively reduced the import procurement costs of crude oil and other raw materials with the appreciation of the RMB. Coupled with the benefits of the industry’s recovery, profits have steadily increased. The purchasing power of RMB of the same scale has increased, which has significantly eased the cost-side pressure on such enterprises.
In high value-added export industries, the appreciation of the RMB has not caused obvious pressure, but has become a driving force for companies to accelerate their global layout.
Relying on the moat built by technological advantages and product competitiveness, high value-added track exports have maintained a strong growth momentum: In the first five months of 2026, my country’s exports of mechanical and electrical products increased by 18.4% year-on-year, of which the export value of integrated circuits surged by 110.9%, and the growth was almost entirely contributed by product price increases; the performance of the new energy vehicle track is equally impressive. BYD’s new energy vehicle exports increased by 80.7% year-on-year in May, and a large number of new cars gathered at ports waiting to be shipped to all parts of the world.
Such high value-added companies generally turn exchange rate risks into opportunities to expand the global market through technological upgrading, self-built logistics fleets, and overseas factories.
Since they have broken away from low-end price competition and relied on technology and brand to obtain premiums in the global market, the impact of exchange rate fluctuations on such companies is much smaller than that of low-end manufacturing companies that are still fighting price wars.
The root of this industry differentiation is essentially the difference in bargaining power of different industries.
For companies that export low value-added products, overseas customers are highly sensitive to prices. After the appreciation of the RMB, if the company keeps its quotation unchanged, its profits will be reduced. If the quotation is raised, orders may flow to lower-cost regions such as Vietnam and India, so they are generally under greater pressure.
For companies that export high value-added products, customers pay more attention to the technology, performance and supply stability of the products. Price is not the only decision-making factor. The company has stronger pricing power and can pass on part of the exchange rate costs.
Some analysts pointed out that as the bargaining power of my country’s exports of medium and low value-added products has gradually improved, the negative impact of RMB appreciation on foreign trade has tended to attenuate. Although the export of labor-intensive products such as clothing, shoes, and toys still showed negative growth in May 2026, the degree of deterioration has not expanded simultaneously with the appreciation, which is enough to reflect the resilience of China’s manufacturing under pressure.
Overall, the impact of RMB appreciation on the foreign trade industry is essentially an accelerated industrial screening: it squeezes the living space of enterprises that rely on low-cost advantages and lack core technologies, forcing such enterprises to improve their risk resistance through technological upgrading, supply chain optimization, and the use of RMB cross-border settlement. At the same time, it also creates a more favorable financial environment for enterprises that master core technologies and have global brand influence, as well as a large number of import enterprises.
According to expert predictions, the RMB will still maintain a stable to strong trend in the short term, but it is unlikely that it will continue to appreciate significantly unilaterally. This differentiated pattern will continue to force China’s foreign trade industry to accelerate the transformation from “winning by price” to “winning by quality.” In the end, the Chinese companies with truly core competitiveness will remain in the global market.
