If you're using fabric softener that could be the reason why. Supposedly fabric softener ruins a towel's ability to absorb water.
this post was submitted on 02 Jul 2025
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Can confirm! I recently stopped applying [fabric softener] to all my [cloth] items and it feels more absorbent. Now using [wool balls] to soften and dry faster.
IIRC somewhere between the ongoing climate (de)buff event and the microplastic reveal.
If you invest in the crafting skill, a hand knit cotton towel still has substantial buffs. The grind is pretty long, but not unpleasant, and you can usually grind another skill at the same time (watching lectures to up your INT, etc)