Shipowners raise prices by five times, cargo stranded in India: Middle Eastern conflict has reached Chinese foreign trade pockets

AI Question: Are the collection standards for war surcharges transparent and reasonable?

Editor’s Note: In early 2026, the fighting in the Middle East is spilling beyond traditional geographic boundaries, remapping the global capital landscape with unprecedented intensity and reshaping the risk-pricing logic used by global capital markets. From oil tankers being stalled at the Strait of Hormuz to liquidity “black holes” stirring in the shadows of Wall Street, the “butterfly effect” of war is triggering shocks across multiple asset classes.

When the macro cycle collides head-on with geopolitical developments, it tests the resilience of every market participant.

In the face of this complex systemic shock, Tencent Finance launched the special project series “The Global ‘Bill’ of Middle East Fighting.” From reviewing supply-chain disruptions and volatility in capital markets, to the shift of the oil-pricing pricing center of gravity; the reshuffling of safe-haven funds into precious metals; the policy constraints facing the U.S. Federal Reserve between inflation and recession; and the reassessment of assets as Dubai serves as a regional haven for capital—we hope that through ongoing in-depth observation, we can sort out the macroeconomic context and the logic of how assets evolve.

By | Zhou Ailin

Edited by | Liu Peng

“Help! My cargo is going to the Middle East, and the shipowner unloaded it in India instead—and they’re charging a sky-high war surcharge!” A China chemical-export trader named Aisha (a pseudonym) told Tencent News’ “Pavilion.”

As it turns out, Aisha is only one among many export traders who are facing the same situation. A large number of export goods from China to the Middle East are being unloaded in India; the original destinations cannot be called on. For example, the UAE, Saudi Arabia, Kuwait, Bahrain, Iran, Yemen, Qatar, and so on—the reason is that the originally planned route needs to pass through the Strait of Hormuz. If they detour via the Cape of Good Hope, they have to face massive transshipment fees.

The current issue is that even if the cargo doesn’t get delivered, shipowners still demand a war-risk surcharge from the exporters. Some export traders report that for a 40-foot container, they’re being charged about $3,500; the total cargo value in a full container is around $20,000. Many exporters have begun questioning the reasonableness of these sky-high surcharges and have started to collectively refuse payment, though doing so may entail legal risks. Another problem is that part of the cargo gets left in Indian ports; if new buyers can’t be found locally, the only option is to re-export, but re-export is not only process-heavy—it may also involve additional import tariffs upon re-entry.

Facing the war, shipowners have been continuously raising prices. A $1,000 container that used to cost might now jump to $5,000. Whether the cargo can ultimately reach its destination is still uncertain. After having gone through 2025, when “reciprocal tariffs” caused disruptions, the year 2026 for export traders may be just as winding.

The Strait of Hormuz they can’t get into

Aisha’s export company is a chemical-products exporting company located in Shanghai. The shipping company transporting her cargo is Hapag-Lloyd (hereinafter “HPL”). HPL is a leading German container shipping company, and it is strong on trans-Atlantic, Middle East, Latin America, and Asia-Pacific routes.

However, nothing can withstand the disruption brought by the fighting. “Most of the cargo goes via HPL to Dubai and Saudi Arabia, but because of the war, some goods were left at Indian ports. Some were shipped to Busan and then, because of the war, turned back and were unloaded in Xiamen. Also, some started from Tianjin Port to Ningbo and then were suspended due to the war. I have one shipment that was sent on March 1; at that time, nobody expected the conflict to develop so severely.”

Aisha said she is relatively fortunate, because although the cargo was unloaded in India, her company found new buyers in India, so it is preparing to resell the shipment. “Because upstream oil prices for chemical products have risen, it’s relatively easier to sell.”

For those that can’t be resold, they can only face “the worst option.” Another export trader who ships from Kuwait to Tencent News’ “Pavilion” said that because of the war, the containers destined for Kuwait are now, after switching ships in India, sitting at Indian ports. The shipping line is offering three options: (1) pick up directly at the port now (the containers are currently in India); (2) change ports, but these Middle East countries can’t be relied on; (3) re-export.

Looking at re-export, many exporters don’t want to choose this route unless it’s unavoidable. “Re-export requires proving to China Customs the reasons for the returned goods and issues with the cargo quality. The process is long, and it very likely involves re-import tariffs—re-import tariffs are about 6.5%, and an additional 13% VAT is also required.” Aisha said that beyond taxes and procedures, re-export is essentially paying another round of shipping costs—and now freight rates are already vastly different from what they were at the beginning of March.

There are also people asking whether abandoning the cargo is feasible, but abandoning the cargo isn’t that simple, and afterwards you may very likely face lawsuits.

According to information, if local customers in the Middle East are willing to bear additional costs, it is also possible to ship via a detour—for example, via the Cape of Good Hope—to avoid the Strait of Hormuz. However, multiple export traders said that taking the detour would also increase freight costs, and the additional costs carry extremely high uncertainty. Unless the Middle East customers agree to bear all expenses, exporters themselves will not proactively choose this route.

Refusing to pay the sky-high war surcharge

Even for Aisha, who is relatively lucky and found an “Indian buyer,” there is still a headache she can’t escape—the sky-high war surcharge.

It is understood that COSCO Shipping/“CMA CGM” has started charging a “Emergency Conflict Surcharge” ranging from $2,000 to $4,000 per container, and the “War Risk Surcharge” charged by HPL is also more than $1,500 per TEU.

What is the war risk surcharge? This extra fee is used to cover the additional insurance costs incurred when vessels enter high-risk areas due to conflicts or piracy. When a route faces higher threats, the carrier passes these costs on to the shipper. Unlike standard freight charges, this fee only takes effect in the specified war zones.

In this round, nearly all cargo shipped by export traders to the Middle East faces demands from shipping companies for surcharges. Aisha sent Tencent News’ “Pavilion” an invoice/bill from a shipping company—Change of Port of Discharge (COD): $350 per shipment; War Risk Surcharge (WRS): USD 1500/TEU (twenty-foot equivalent unit); Container detention/handling fee: charged based on the actual amount incurred; Documentation change fee (DAF): RMB 300 per shipment + SMC (re-submission of manifest) $40 per shipment (if generated); Invoice deletion fee (DDF): RMB 300 per shipment (if generated).

She said that different shipping companies charge very different war surcharges. HPL charges up to $3,500 for a 40-foot container. For cargo with a value of over $20,000, this undoubtedly amounts to extremely high costs.

“The shipping company charges the war surcharge without our consent. The cargo even gets turned around halfway, or is still within China and not even leaving the country, yet they charge it anyway. In our view, this is completely unreasonable. For now, we are refusing to pay the war surcharge as a group. Later we’ll consider filing a collective lawsuit. But if we were to have each company file on its own, we can’t afford the time and effort, because there’s a lot of other countries’ cargo that still needs handling.”

However, the consequence of not paying the war surcharge is that the shipping company will not amend the bill of lading and will not release the cargo held up. This makes it difficult for Aisha to resell the goods that were unloaded in India to local buyers there.

How to respond to war surcharges?

Are war surcharges really reasonable? And how should export traders respond rationally?

Yang Li, founding partner at Shanghai Dehe Hantong (Qingdao) law firm, told Tencent News’ “Pavilion” that when dealing with the issue of war surcharges, export companies should prioritize pushing for collective negotiations in order to reduce the risk of collective breach of contract.

“Although many export traders believe the surcharge is unreasonable and that it’s a post-event notice, we still need to examine whether the shipping company provided prior notice and publicized it in advance, and how the relevant contract clauses are actually written. In general, based on the war clauses and rerouting clauses on the back of the bill of lading, these fees are essentially intended to address increased costs caused by unforeseen risks during transportation. If the surcharge is reasonable and aligned with the contract terms, the cargo owner’s collective refusal to pay may constitute a clear breach.”

Even so, Yang Li pointed out that when international conditions change in a specific way, and the booking fees are not adjusted accordingly, the reasonable range for the increased costs still leaves room for debate. Therefore, a “two-pronged approach” should be adopted: on the one hand, negotiate with the shipowner to clearly define the charging standards; on the other hand, make arrangements for transportation follow-ups and should not rely entirely on the shipping company.

In addition, the lawyer also believes that regarding the reasonableness of amending the bill of lading, changing ports, and fuel surcharges, there also needs to be specific communication. If the voyage is not increased, there is no risk of rerouting through affected zones, and no additional costs are incurred, then fees that did not happen should not be forced onto the cargo owner. Overall, the reasonableness of the fees, the contractual provisions, the actual increase in costs, and changes in international conditions are all key factors that must be considered comprehensively.