The U.S. government dealt another blow to Chinese e-commerce platforms and the air cargo market with Tuesday’s declaration that tariffs on imports from China will be jacked up an additional 50%, jeopardizing demand for their ultra-low-cost merchandise less than a week after duty-free customs privileges were revoked.
As part of his escalating trade war with China, President Donald Trump also imposed more draconian fees on low-value shipments from the country that move through the international postal system.
Trump's trade actions are “going to decimate airfreight out of China because Temu and Shein’s volumes are going to get hammered” when the rules go into effect on May 2, said Derek Lossing, a former logistics executive at Amazon and founder of e-commerce supply chain consultancy Cirrus Global Advisors, in a phone interview. “Demand is going to dry up. It’s gonna be brutal.”
Trump last Wednesday ended the so-called de minimis exemption and gave notice that postal parcels will face a duty rate of either 30% of their value or $25 per item, increasing to $50 per item on June 1. The stated reason was that the frictionless entry enjoyed by parcels made it easy for criminals to smuggle illicit fentanyl and counterfeit goods into the country. By forcing small-dollar shipments through a formal entry process, the administration says authorities can apply analytics to identify suspicious parcels for inspection.
On Tuesday, Trump hiked the duty rate to 90% and the flat fee to $75. The flat fee slated for June 1 was revised to $150 from $50, according to the executive order. Shippers can choose the percentage rate or the fee route and can change their choice once a month.
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