How Will the Naphtha Shock Affect Imports from China? Sourcing Strategies in an Era of High Oil Prices and Soaring Logistics Costs

Naphtha is a type of petrochemical feedstock produced during the refining of crude oil.

Naphtha is used as a base material for petrochemical products, and it is used to make a wide variety of materials, including plastics, synthetic fibers, resins, and chemical products.

In other words, many of the products we use in our daily lives are indirectly related to naphtha.

Commonly imported from China,

・Storage cases

・Smartphone accessories

・PVC products

・Acrylic goods

・Packaging materials

These items often use naphtha-derived materials and are therefore highly susceptible to fluctuations in naphtha prices.

Therefore, when naphtha prices rise, raw material and manufacturing costs tend to increase as well.

Recently, there has been an increasing tendency to use the term “naphtha shock” as a straightforward way to describe the situation in which rising naphtha prices are having a widespread impact on manufacturing and logistics costs.

In particular, in industries that use large amounts of plastics and chemical materials, rising raw material prices tend to have a direct impact on product costs.

The underlying factors include:

・Soaring crude oil prices

・Deteriorating conditions in the Middle East

・Disruptions in maritime transport

・Global inflation

・Currency fluctuations

and others.

Furthermore, recent instability in logistics and energy prices has made manufacturing costs at Chinese factories more prone to increase.

Since China is home to such a high concentration of manufacturing that it is often called the “world’s factory,” fluctuations in naphtha prices could significantly impact sourcing from China and OEM production.

・Rising cost of goods sold

The biggest impact, as expected, is on the cost of goods.

For example,

・Plastic cases, PVC bags, synthetic
fiber apparel, acrylic
products, and household

goods

are prime examples of products highly susceptible to fluctuations in raw material prices.

Since manufacturers also need to maintain their profits, there are increasing cases where “purchase prices have risen compared to before.”

E-commerce businesses dealing in low-priced items, in particular, are prone to seeing their profit margins squeezed.

・Rising packaging costs

An often-overlooked factor is the impact on packaging materials.

In e-commerce sales,

・OPP bags
・Shipping bags
・Air cushions
・Tape
・Cardboard boxes

and other items in large quantities.

Since many of these are made from petroleum-based materials, this sector is particularly susceptible to rising naphtha prices.

In other words, not only product prices but also “shipping costs” may rise.

・Impact on International Shipping Costs

When crude oil prices rise, it tends to affect the cost of fuel used for sea and air freight.
As a result, fuel surcharges and transportation costs may increase, which can lead to higher international shipping rates.

However, logistics costs are not determined solely by crude oil prices.

In reality,

・Container supply and demand

・Port congestion

・Route changes

・International political and economic conditions

・Exchange rate fluctuations

and other factors.

Recently, in particular, the situation in the Red Sea and global logistics disruptions have led to a prolonged period of instability in shipping costs.

For businesses importing from China, many calculate profits on a “shipping included” basis, making these fluctuations a significant issue.

Recently, it is not uncommon for shipping costs to exceed the product price itself, especially for low-priced items.

Therefore, moving forward, it will be important not only to simply search for “cheap products” but also to design profit margins that include shipping costs.

In particular, small, lightweight products that are easier to maintain a profit margin on are likely to become even more important in the future.

While naphtha is often associated with plastics, it is actually used as a raw material for a wide range of petrochemical products, including plastics and synthetic fibers.

In the apparel industry in particular,

・polyester
, nylon, and
acrylic

are all derived from petroleum.

Recent fashion products frequently use synthetic fibers due to their functionality and affordability.

Therefore, when naphtha prices rise,

・fabric prices, prices
of auxiliary materials, and
manufacturing costs

are also likely to rise.

Cost management will become even more critical for businesses engaged in OEM production.

Recently, attention has been focused on changes in U.S.-China relations and future policy toward China.

In particular, some observers are expressing concern that President Trump’s visit to China and developments in U.S. policy toward China could lead to changes in the logistics environment and tariff policies.

If U.S.-China relations move toward greater stability in the future, this could lead to greater stability in the Chinese economy and international logistics.

As a result, there may be situations where improvements in the maritime transport and trade environments can be expected.

On the other hand, since U.S.-China relations involve multiple factors such as politics, economics, and security, there are many uncertainties, and it is not certain that the situation will improve significantly in the short term.

Furthermore, depending on changes in tariff policies, export restrictions, and the international situation, logistics costs and the import environment could, conversely, become unstable.

Therefore, rather than assuming that “things will settle down eventually,” it is crucial for importers to plan their profit margins and manage inventory based on the premise that “fluctuation risks may persist.”

・Review profit margins

The first priority is to review your current profit structure.

If you stick with your previous pricing,

・Increased shipping costs
, rising material costs
, higher advertising expenses
, and increased packaging costs

may have significantly reduced your profits.

Especially when selling on Amazon,

・FBA fees
, advertising costs
, and return costs

are also factored in, so profits may be lower than expected.

It is important to recalculate your profits based on the latest costs.

・The importance of lightweight, high-margin products is increasing

Going forward, “small, light, and high-margin” products may become more advantageous than “large, heavy, and low-cost” ones.

For example,

・Accessories

・Beauty accessories

・Smartphone accessories

・Fan merchandise

・OEM small items

are categories where it’s easy to keep shipping costs low.

Small items are particularly well-suited for platforms like TikTok Shop and live commerce, so demand is likely to grow even further in the future.

・A small-batch strategy is key

In an era of unstable costs and shipping fees, “large inventories” can sometimes become a risk.

In the past, the general mindset was that “buying in bulk is cheaper.”

However, given

・price fluctuations
, shifts in trends, and
changes in sales performance

are occurring at an extremely rapid pace.

Therefore, moving forward,

・small batches, quick turnover, and test

sales

.

Due to the naphtha shock, fluctuations in production and logistics costs are likely to become even more significant going forward.

The days when "buying cheaply guarantees a profit" are gradually coming to an end.

Especially when importing from China, the final profit margin can vary significantly depending on price differences between factories, shipping terms, minimum order quantities, and inspection accuracy.

Furthermore, in recent times,

・Rising raw material prices
・Soaring international shipping
costs ・Exchange rate fluctuations

have made the procurement environment itself increasingly unstable.

That is precisely why, moving forward, it will be crucial to plan not only “which products to source” but also “how to import them.”

For example, at hubbuyer,

• Small-lot sourcing
, • OEM consultations
, • Factory comparisons
, • Quality inspection support
, • Logistics optimization

and more, providing comprehensive support for sourcing from China.

Especially during periods of fluctuating raw material prices and logistics costs, such as the naphtha shock, it is crucial to adopt a mindset of “designing your procurement strategy by working backward from the selling price.”

For example:

・Avoiding
large items prone to skyrocketing shipping costs ・Increasing
the proportion of lightweight items ・Minimizing
inventory risk with small batches ・Increasing OEM products that are easier to maintain profit margins

It is essential to think strategically from the procurement stage.

At hubbuyer, we prioritize “sourcing from China with sales in mind” rather than simply acting as a purchasing agent, making our services even more vital in times of significant cost fluctuations like those we’ve seen recently.

In e-commerce in particular, there is an increasing number of cases where “sales are growing but profits are not.”

The cause is not limited to product costs alone.

・Rising shipping
costs ・Increased packaging costs
・Soaring
advertising expenses ・Exchange rate fluctuations
・Return costs

and other hidden costs are gradually eroding profits.

That is precisely why, moving forward, it will become increasingly important to develop a comprehensive strategy that considers not just “sourcing at low prices,” but also “how much profit remains in the end.”

The naphtha shock is not merely an issue for the chemical industry alone.

For businesses engaged in imports from China, OEM manufacturing, and e-commerce sales, it is a critical issue that affects product costs, packaging expenses, logistics fees, and ultimately, profit margins.

Recently, in particular, with rising crude oil prices, soaring logistics costs, and exchange rate fluctuations all converging, there has been an increase in cases where “sales are growing but profits are hard to come by.”

The days when “buying cheaply guarantees a profit” are gradually coming to an end.

That is why, moving forward, it will be crucial to focus not only on “how cheaply we can source goods,” but also on “how much profit we can ultimately retain.”

For example, it is becoming necessary to adopt a mindset of profit planning from the procurement stage itself—such as increasing the proportion of lightweight products to reduce shipping costs, minimizing inventory risk by purchasing in small batches, or avoiding price competition through OEM partnerships.

In e-commerce sales in particular, hidden costs—such as advertising, packaging, returns, and FBA fees—have a significant impact on profits, not just the cost of goods sold.

Therefore, moving forward, it will become even more important not just to “find products that sell,” but to “create a structure that generates profit.”

Precisely because we are living in an era of rapid change, businesses that can adapt flexibly to market conditions may find it easier to generate stable profits.