Chinese factories slow production, workers sent home, and global exports face unforeseen troubles

Source Cryptopolitan

Factories across China are scaling back operations, sending workers home, and halting production lines as US tariffs imposed by President Donald Trump squeeze Chinese exports. The slowdown has reportedly spread across multiple provinces but is straining industrial towns the most.

In provinces such as Guangdong, Zhejiang, and Fujian, factories are going quiet. Reports from factory workers, managers, and recruitment agents cited by the Financial Times claim that plants producing goods like plastic moulds, toy parts, shoe soles, and electrical appliances have stopped overtime, canceled weekend shifts, and, in some cases, shut down for weeks.

An anonymous worker at a plastics factory in Fujian said operations stopped for a week because export orders vanished. 

“Our export orders disappeared, so we’ve temporarily stopped,” she explained.

Similarly, a 26-year-old toy factory worker in Zhejiang confirmed his employer had granted a two-week leave. “It’s not easy at the moment,” they complained.

Tariffs cause declines in US-bound shipments

The US is now imposing tariffs as high as 145% on most Chinese imports, which has supposedly caused demand from American clients to dry up. According to customs data, the US accounted for approximately 15% of all Chinese exports last year.

At DeHong Electrical Products in Dongguan, workers were given a month off on minimum wage. A notice from the company told employees there was “significant near-term pressure” and confirmed that several American clients had paused their orders.

In Hangzhou, Stellarmed, a producer of endoscopy kits for the US medical market, told workers to use the remainder of April to find new jobs. The company also provided access to a headhunting agency, uncertain about staying in business in the foreseeable future.

A manager at Ningbo Taiyun Electric said production was halted on April 12, though the company has since resumed partial output for European orders. 

“We still have some orders from Europe, we’re trying to get more,” said the manager. “Hopefully, the US will change its policies.”

Han Dongfang, founder of the China Labour Bulletin, said the factory furloughs place industries in a transformation period that could see factories closed and employees lose jobs. 

“The rearrangement of China’s manufacturing sector will be a long-term process, and workers will be sacrificed,” he said.

Recruiters in Guangdong said only the most US-dependent factories were shuttering completely, but many more were reducing hours. Factories like Dongguan Yuanguan Technology, which once ran overtime and weekend shifts, are now open for a few hours in a business week, and hiring freezes are now common.

Local governments step in

Some Chinese cities, like technology and export hub Shenzhen and Dongguan, announced last week they would issue a support package to manufacturers to cover the dent left by broken supply chains. 

While exports suffer, China wants to reduce its reliance on oil imports. According to Bloomberg, Beijing is investing heavily in domestic oil production. The country now rivals Iraq as one of the top five oil-producing nations globally, trailing only the US, Saudi Arabia, Russia, and Canada.

Last year, China imported more oil from the US than any nation besides the Netherlands, which refines oil for European customers. However, as Chinese state-owned oil giants invest nearly $80 billion annually in new wells and facilities, the country is rapidly reducing its dependence on foreign suppliers.

WTI crude oil futures held steady near $62 per barrel on Thursday after falling more than 2% the previous day. Markets reacted more positively to news of a potential increase in OPEC+ output. 

Sources suggest that several OPEC+ nations will likely push for a second straight month of accelerated production hikes in June. Meanwhile, Kazakhstan, an alliance partner, has announced it will not reduce output at its major oil fields or make any coordinated cuts.

Cryptopolitan Academy: Coming Soon - A New Way to Earn Passive Income with DeFi in 2025. Learn More

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
Gold holds steady below $4,150 amid elevated US yields Gold price (XAU/USD) trades on a flat note near $4,140 during the early Asian session on Tuesday. Pressure from a stronger US Dollar (USD) and elevated US Treasury yields was offset by reduced expectations of a Federal Reserve (Fed) rate hike this month.
Author  FXStreet
Oct 06, Tue
Gold price (XAU/USD) trades on a flat note near $4,140 during the early Asian session on Tuesday. Pressure from a stronger US Dollar (USD) and elevated US Treasury yields was offset by reduced expectations of a Federal Reserve (Fed) rate hike this month.
placeholder
WTI rises to near $89.50 as Middle East supply threats offset Persian Gulf recoveryWest Texas Intermediate (WTI) oil price extends its gains for the second successive day, trading around $89.50 per barrel during the Asian hours on Wednesday. Crude oil climbed as persistent risks to Middle East energy flows overshadowed signs of rising supply from the region.
Author  FXStreet
Yesterday 01: 26
West Texas Intermediate (WTI) oil price extends its gains for the second successive day, trading around $89.50 per barrel during the Asian hours on Wednesday. Crude oil climbed as persistent risks to Middle East energy flows overshadowed signs of rising supply from the region.
placeholder
Gold Price Forecast: XAU/USD retraces gains and nears two-month lows at $4,104Gold (XAU/USD) retraces Tuesday’s gains on Wednesday and resumes its broader bearish trend, with the US Dollar (USD) appreciating across the board, as investors brace for the release of the minutes of the latest Federal Reserve (Fed) meeting.
Author  FXStreet
Yesterday 10: 13
Gold (XAU/USD) retraces Tuesday’s gains on Wednesday and resumes its broader bearish trend, with the US Dollar (USD) appreciating across the board, as investors brace for the release of the minutes of the latest Federal Reserve (Fed) meeting.
placeholder
Euro slides to a 17-month low as France's budget crisis spreads — can 1.12 hold?EUR/USD touched 1.1162 on 5 October, its weakest level in 17 months, as France's budget standoff pushed the 10-year OAT above 5% and the OAT-Bund spread to roughly 160bp — the widest since the 2011-12 eurozone debt crisis. The euro now trades near 1.1215 ahead of US jobless claims and a $22 billion 30-year Treasury auction. Here are the levels and the two scenarios to watch.
Author  Irene Q.
4 hours ago
EUR/USD touched 1.1162 on 5 October, its weakest level in 17 months, as France's budget standoff pushed the 10-year OAT above 5% and the OAT-Bund spread to roughly 160bp — the widest since the 2011-12 eurozone debt crisis. The euro now trades near 1.1215 ahead of US jobless claims and a $22 billion 30-year Treasury auction. Here are the levels and the two scenarios to watch.
placeholder
Gold falls to a two-month low as real yields bite — can $4,000 hold?Gold hit a two-month low on 7 October, with spot touching roughly $4,090 and COMEX December futures closing at $4,140.70, even as the New York Fed's one-year inflation expectation rose to 3.9% — its highest since May 2023. The paradox resolves through real yields: the 30-year Treasury yield reached 5.732% intraday, its highest since 2002. Here are the levels, the institutional split, and the scenarios into tonight's jobless claims and 30-year auction.
Author  Irene Q.
3 hours ago
Gold hit a two-month low on 7 October, with spot touching roughly $4,090 and COMEX December futures closing at $4,140.70, even as the New York Fed's one-year inflation expectation rose to 3.9% — its highest since May 2023. The paradox resolves through real yields: the 30-year Treasury yield reached 5.732% intraday, its highest since 2002. Here are the levels, the institutional split, and the scenarios into tonight's jobless claims and 30-year auction.
goTop
quote