After a brief scare yesterday, the USPS has lifted the world’s shortest shipping suspension, confirming that it will continue to deliver packages from China and Hong Kong to the U.S.
The news follows a temporary halt on Chinese parcels following President Trump’s executive order that applies a 10% tariff to Chinese goods and lifting the de minimis exemption for shipments from China. The USPS says it’s currently working on a plan to implement these fees with the “least disruption to package delivery,” but that it will continue to accept impacted packages in the meantime.
While other shipping services like UPS or FedEx have yet to announce their own responses to the President’s order, all will have to come up with some sort of plan. Still, it seems your grandparents overseas will still be able to send you care packages. But that doesn’t mean we’re out of the woods yet. While packages will continue to flow, expect delays as shippers learn how to navigate new fees, as well for prices to jump.
While a 10% tariff is fairly self-explanatory (goods from the tariffed country will be 10% more expensive to import), the loss of the de minimis exemption is a little harder to understand, and is likely to be a major thorn in the side of low-cost online Chinese marketplaces like Shein and Temu.
Enacted in 1930, the de minimis exemption was intended as a way for the U.S. to save itself some hassle, by waving duties and fees on international shipments where the collected revenue would take more effort to charge than the government would get out of them. It typically applies to all packages worth less than $800, which has been a boon for online e-commerce. According to a 2023 U.S. Congressional committee report cited by Reuters, almost half of all de minimis exemptions to this point have been for Chinese packages, with 30% of daily de minimis shipments coming from Temu and Shein.
With those protections going away, said stores would now be subject to customs on all goods, in addition to the 10% tariff, which could raise prices and shipping times. American stores that rely on Chinese warehouses, such as Amazon Haul, could also be impacted.
It’s unclear at this point how much of that additional pain will be passed on to customers. Speaking to Reuters, the CEO of warehouse management software ShipHero, Aaron Rubin, said the fees are “probably about 5 points of margin difference, using de minimis or not, and e-commerce businesses usually have a 10% or 15% margin, so this is a very significant impact”
Conversely, University of Delaware fashion and apparel studies professor Sheng Lu told the outlet that the new rules might only add a few cents to each product. However, despite sounding like a modest price hike, it could still greatly impact smaller Chinese businesses who don’t have the cost-absorbing resources Temu or Shein do.
Note that the de minimis exemption as a whole is not gone—Trump’s new rules are currently only directed at China (originally, they would have also impacted Canada and Mexico, but the President’s recent deals with those countries have given them a 30-day stay on enforcement for now). With that in mind, it’s possible another country’s own version of Temu could dethrone the e-commerce giant, or that Chinese shippers could use an intermediary to slightly reduce their fees.