Iran War Overshadows Tariff Fears for Chinese Exporters Ahead of Trump-Xi Summit
CNBC reported Tuesday that Chinese exporters are more alarmed by the ongoing Iran war than by U.S. tariffs as President Donald Trump and Chinese President Xi Jinping prepare to meet later this week.
Iran War Becomes the Dominant Pressure for Chinese Exporters
Exporters across China have shifted their primary anxiety away from trade levies. The conflict has choked critical shipping routes, driven an historic energy shock, and threatened to compress global demand for Chinese goods. Analysts and business owners interviewed for the CNBC report said many exporters barely raised tariffs when asked about their summit expectations. Wang Dan, China director at Eurasia Group, said the singular focus has moved to how long hostilities will last. Some businesses have already prepared contingency plans to shrink operations in the second half of 2026 if fighting continues.
Also Read: U.S.-China Trade Truce Reached After Tariffs Hit Triple Digits
Shipping Delays and Soaring Costs Hit Manufacturers Hard
The disruption is playing out in direct operational terms for exporters. Bryan Zheng, founder and CEO of Shenzhen cycling helmet maker Livall Tech, told CNBC that maritime delays through the Strait of Hormuz have stretched Asia-to-Europe shipping times to roughly 50 days. That compares to 30 to 40 days under normal conditions. Zheng said he has been forced to rely on expensive air freight to compensate. Port backlogs at Shanghai and Ningbo have compounded the problem, pushing freight rates sharply higher. A rail freight alternative was also blocked after his products were classified as dual-use goods given active conflict zones along the route. By contrast, Zheng argued higher tariffs are manageable because costs can be passed to consumers.
Background: A Year of Tariff Whiplash Already Reshaped China’s Trade Map
Last year’s escalating U.S.-China trade war pushed levies briefly into triple digits. That episode forced many Chinese manufacturers to diversify production into Southeast Asia, the Middle East, and Africa. China’s exports to the United States fell roughly 20% in 2025, while shipments to Africa rose nearly 26%. The trade truce the two nations eventually reached did little to reverse those structural shifts.
Summit Expected to Reaffirm Hormuz Cooperation
Ahead of the talks, analysts at the Economist Intelligence Unit said Washington and Beijing are likely to issue joint statements backing efforts to reopen the Strait of Hormuz and stabilize the region. But prolonged maritime standoffs and stop-and-go negotiations remain the more probable near-term outcome. Raw material input costs in China surged 3.5% year-on-year in April, a sharp acceleration from 0.8% in March, reflecting how deeply the conflict is rippling through industrial supply chains.
Read Next: Oil Markets Brace for Extended Hormuz Disruption as Iran Talks Stall
