Unlock the White House Watch newsletter for free
Your guide to what the 2024 US election means for Washington and the world
The US Postal Service said it would suspend delivery of packages from China while Chinese logistics groups announced steep new fees, as President Donald Trump’s abrupt decision to levy tariffs on lower-priced goods hit exporters in the world’s second-largest economy.
The US Postal Service gave no reason for its decision to suspend packages temporarily, which would also cover Hong Kong, saying only that it would still accept flat parcels and letters.
Customs agents now have to check and clear packages mailed from China following Trump’s decision to scrap the “de minimis” rules exempting shipments under $800 from duties.
The changes will drive up sharply the cost of the 4mn parcels a day arriving in the US under the de minimis exemption, about 30 per cent of which come from Chinese ecommerce groups Temu and Shein. With flights disrupted, the new tariffs threaten to hit China’s burgeoning international ecommerce trade at a moment when Beijing is relying on exports to offset weak demand in its domestic economy.
Exporters said Chinese logistics companies were still operating but some have begun demanding 30 per cent upfront withholding fees to cover increased levies on de minimis shipments.
“Logistics companies . . . have gradually given notice to us on charging an extra 30-35 per cent of value of our goods to counter the tariffs, as well as an extra Rmb20 ($2.75) per package,” said Liu, a cross-border ecommerce trader in Changsha, in China’s central Hunan province.
Liu said he sold circuit boards on Amazon, Ebay and other sites, with the US accounting for 20 per cent of his annual sales. “This [the tariff increase] comes directly from our pockets.”
Chinese logistics company CNE Express on Wednesday issued a notice to customers saying it would withhold the equivalent of a “comprehensive tariff” at 30 per cent of the order value of a shipment plus a handling charge of Rmb20 per package.
“The final amount levied will be determined by the actual charges imposed by US Customs and Border Protection,” it said, saying that any difference would be refunded to the customer.
Joe Biden’s administration last year flagged changes to the de minimis regime, which the US blames for allowing a flood of drugs and other illegal goods to enter the country, while Trump has long threatened higher tariffs.
But the speed of Trump’s implementation of additional tariffs on China caught many by surprise. The president’s executive order authorising an additional blanket 10 per cent tariffs and the scrapping of de minimis was signed on Saturday and went into effect on Tuesday.
Not only will parcels formerly qualifying for de minimis now have to pay the 10 per cent, but they will also be hit with existing tariffs.
Trump and China’s President Xi Jinping are expected to hold a call in the coming days, although the US leader said on Tuesday that he was in “no rush” to talk to his Chinese counterpart.
“What is needed now is not unilateral tariff increases, but dialogue,” said China’s foreign affairs ministry on Wednesday.
Some exporters said they had stopped receiving and sending orders while they waited for clarity on the changes.
One person familiar with the matter at Temu said it had mostly cancelled its bookings for freight flights from Hong Kong starting on Friday.
“It created a bit of chaos . . . because as we know, the de minimis is basically dead right now and a lot of the airlines that actually fly to the US . . . have cancelled flights,” the person said.
Gongsun, a vendor from China’s southern Guangdong province who sells through Amazon, said DHL, UPS and FedEx were still taking parcels but he had suspended all shipments to the US anyway.
“We don’t know what will come next,” he said.
Gary Lau, business development director at freight forwarder Jet-Speed Air Cargo Forwarders, believed Chinese exporters could weather the tariff increases because their goods were still much cheaper than other countries’.
Wen Biao, general manager at Shenzhen-based Qianhe Technology Logistics, said Chinese sellers already had thin margins and would be forced to increase their selling prices.
“Customers [in the US] are likely to have to pay more going forward,” he said.
DHL said it was working with customers and suppliers to “navigate” the changes to “limit adverse impact on US importers and consumers”. UPS and FedEx did not immediately respond to requests for comment.
Reporting by William Langley in Guangzhou, Chan Ho-him in Hong Kong, Wenjie Ding, Tina Hu and Joe Leahy in Beijing
