The Trump administration will reduce tariffs on small packages from China worth less than $800 from 120% to 30%. It will also cancel the planned increase in the fixed tariff to $200 per package on June 1st, maintaining the current rate of $100. Many foreign traders said they are rushing to ship goods but are also adjusting their export strategies to avoid further impacts from higher tariffs.
The White House issued an executive order on Tuesday announcing tariff cuts on so-called "de minimis" goods, targeting low-priced goods imported from China and Hong Kong. Under the new rules, small imported packages will be subject to a 54% tariff or a flat fee of $100. Reuters also reported on Wednesday that, based on a White House executive order and industry experts, the US tariff on small packages from China outside the postal system will be further reduced to 30%, further mitigating the damage from the trade war between the two countries.
This policy is considered part of a 90-day trade truce reached between the United States and China following trade talks in Switzerland. Under the agreement, the United States will reduce its overall tariffs on Chinese goods from 145% to 30%, while China has pledged to reduce its tariffs on US goods from 125% to 10%. Both sides hope the agreement will ease escalating trade tensions and buy time for further negotiations.
Cross-border e-commerce companies are actively adjusting and seeking to restart exports to the United States
Mr. Jiang, an e-commerce operator in Shaoxing, Zhejiang, told Radio Free Asia in an interview on Wednesday (the 14th) that he has begun shipping to the United States based on customer requests. "We specialize in clothing, accessories, gifts, and more through the Shein platform. We ship small packages directly by air. We expect the goods to reach our US customers in one to two weeks. Although the tariff has been reduced to 54% this time, it is still very expensive. After this batch of orders is shipped, we will ship all subsequent shipments by sea freight, which will reduce costs. Now we are worried about the long shipping time and the fear of further tariff changes in the United States. As small businesses, we can't afford the high tariffs."
Mr. Jiang, who also runs a home goods business, said that after the policy adjustment, they resumed direct mail to the US for some products. "This is especially true for kitchenware and small smart appliances priced between $50 and $100, which still have profit margins under the current tax rate. However, many of our peers are most worried about policy fluctuations. We are no longer willing to carry too much inventory, and are instead moving more inventory to overseas warehouses."
After China and the United States reached an agreement on Monday, paving the way for a tariff war that has raged for over a month, foreign trade companies in Guangdong, Zhejiang, Fujian, and other regions received notifications from American clients. Ms. Ge, head of a Shenzhen foreign trade company, told this station that the company had finally received urgent urging from American clients and was now shipping products. "We received an email from an American client two days ago, urging us to expedite shipment, and we are now rushing to ship the products. Our peers have also been busy shipping these past two days, striving to clear their inventory as quickly as possible."
Chen Jianlin, a Temu supplier in Xiamen, Fujian, told this station that high tariffs nearly forced them to abandon the US market. "Temu's orders dropped by 60%," he said. "The US tariff reduction gave us a break, but we also know it's only a temporary reprieve. We now have a three-month window. We've established an overseas warehouse in Vietnam and are beginning to explore ways to get our products onto several Southeast Asian platforms to diversify our risks."
Chinese e-commerce companies are intensively preparing to ship to the United States
The news of the tariff reduction is undoubtedly a respite for Chinese cross-border e-commerce platforms such as Shein and Temu, which rely on low-cost direct mail. Previously, in early April, the United States eliminated duty-free status for packages under $800 and imposed punitive tariffs, which had previously caused these platforms to face challenges such as price increases and logistics delays.
Chen Jianlin believes that the 54% tariff is still far higher than the previous zero tariff level, so many e-commerce companies are urgently developing countermeasures. He said that to avoid high direct mail tariffs, many merchants have increased their investment in overseas warehouses in the United States, reducing costs and increasing efficiency through early shipments and in-warehouse sorting. He said, "Many companies are exploring third-country transshipment routes, such as through Vietnam and Mexico, to reduce trade barriers. In addition, they are exploring markets outside the United States, such as Europe, Southeast Asia, and Latin America."
According to official Chinese data, the scale of China's cross-border e-commerce trade has grown more than tenfold over the past five years. The number of cross-border e-commerce companies has exceeded 120,000, and they have registered over 30,000 trademarks overseas.
According to Chinese customs data, China's total cross-border e-commerce imports and exports reached 1.22 trillion yuan in the first half of last year, a year-on-year increase of 10.5%. Exports grew by 6.9%, with the United States remaining the largest export market, accounting for 35%. For the entire year, cross-border e-commerce imports and exports totaled 2.63 trillion yuan, a year-on-year increase of 10.8%.
Uncertainty about future tariffs increases significantly
Li Qiaoren, a Zhejiang-based foreign trade businessman, told reporters that many foreign trade companies and enterprises have experienced the impact of the Sino-US tariff war. Numerous foreign trade-related factories in Zhejiang, Jiangsu, and Guangdong have halted operations or even closed down. Chinese businesses must adjust their global strategies to survive and thrive. "If we don't adjust, there's no way out. We've also raised the unit price of our exports. While the US is our largest market, you never know when we might be faced with high tariffs. We need to prepare for multiple scenarios and explore emerging markets."
Li Qiaoren stated that while the Sino-US trade situation has eased in the short term, this round of tariff reductions will only last for 90 days. The Trump administration has repeatedly adjusted its tariff policy in the past, raising widespread concerns in the Chinese industry: "If subsequent negotiations between the two sides break down, the risk of export goods being subject to high tariffs again is unpredictable."
