After around six years of massive growth ahead of 2026, Chinese low-cost ecommerce exports have fallen yet again, continuing the monthly trend of declines this year.
These struggles are likely linked to the Iran War, as it has led to increasing costs and decreasing demand, both of which directly hurt the profits of the likes of Temu, Shein, and AliExpress.
China’s Low-Cost Ecommerce Exports Continue to Decline
Even though China’s low-cost ecommerce exports have experienced major growth over the better part of the last six years, much of 2026 has been difficult for the space. In fact, April saw these exports fall 10.9%, down to $9.81 billion. This marks the fifth consecutive month of declines compared to a year ago.
However, this decline is still very recent. It’s important to note that the Chinese ecommerce market is still much higher and more valuable than it was even in 2024.
This difficult news for Chinese ecommerce platforms also comes amidst Europe losing patience with Shein, Temu, and other Chinese ecommerce retailers that sell these types of low-cost imported products. Not only are countries fining these retailers, but they will soon impose a handling fee on them to cover enhanced screening costs for these items entering Europe.
The Main Drivers of China’s Ecommerce Struggles
There are two main drivers of these Chinese ecommerce difficulties. First, the increased cost of jet fuel is leading to rising air freight costs, making it much more expensive for Chinese companies to ship their products to places like Europe and North America.
These added fuel costs hit ecommerce brands especially hard, as ecommerce is one of the major drivers of the growing air freight market.
In addition to higher logistics costs for Chinese retailers, weaker demand from lower-income customers in the West is also hurting them. This is largely due to rising inflation. Not only have other costs increased, such as gas and groceries, but ecommerce purchases have gotten pricier due to sellers having to bake in their higher costs into the prices of the items they sell.
Both the increased fuel costs and the rising inflation and decreased demand around the world are likely driven by the recent Iran War. While many believe the eventual end of the war may lead to these costs coming back down to earth and demand rising once again, some people aren’t so sure.
For example, Judah Levine, Head of Research for freight platform Freightos, said that jet fuel prices will take time to fall even if the conflict ends. As a result, even if the war were to end tomorrow, it may take some time for costs to decrease and stabilize, which could mean more difficulties ahead for Chinese ecommerce.
Our Take
Short-Term Issues or a Sign of Things to Come?
It’ll be interesting to see if these Chinese ecommerce struggles continue, or if they’re just a byproduct of the Iran War and all it’s doing to demand and costs around the world. There’s a good chance the market perks back up once the war ends and costs return to normal.
However, if these higher costs and fees remain, or get even worse in the near future, it may pull the Chinese ecommerce market even further back to reality from the incredible highs it has been experiencing over recent years.
