A United States Postal Service employee at work in New York City on Dec. 4, 2023.
Brendan Mcdermid | Reuters
The U.S. Postal Service said Tuesday it’s temporarily suspending all inbound packages from China and Hong Kong Posts.
The change is effective immediately and will remain “until further notice,” according to an alert posted to the agency’s website. Letters and large envelopes, referred to as “flats,” sent from China and Hong Kong won’t be impacted, the USPS said.
The announcement comes after President Donald Trump on Saturday signed executive orders imposing tariffs on China, Mexico and Canada. Trump on Monday agreed to hold off on imposing 25% tariffs on Canada and Mexico for 30 days, but the additional 10% tax on goods from China remains.
A provision in the orders eliminates a popular trade loophole, known as “de minimis,” which allows exporters to ship packages worth less than $800 into the U.S. duty free.
The de minimis provision has been a critical tool for Chinese e-commerce firms, including Shein and PDD Holdings‘ Temu, as they look to grow their presence in the U.S. by offering rock-bottom prices on everything from clothes and furniture to electronics and home decor.
The U.S. processed more than 1.3 billion de minimis shipments in 2024, according to data from the U.S. Customs and Border Protection agency. A 2023 report from the U.S. House’s Select Committee on the Chinese Communist Party found that Temu and Shein are “likely responsible” for more than 30% of all packages shipped to the U.S. under the provision, and “likely nearly half” of all de minimis shipments originating from China.
China Post and Hong Kong Post are government-operated postal services. It’s unclear if the suspension applies to package shipments from China and Hong Kong sent via private mail carriers. In response to a request for clarification, a USPS spokesperson pointed CNBC to the agency’s original announcement.
Cross-border e-commerce companies rely on USPS for about 31% of last-mile deliveries, said Chris Pereira, president and CEO of consulting firm iMpact. They also use a variety of shipping providers including DHL, FedEx and UPS, as well as smaller carriers, he said.
USPS has “traditionally been a cost-effective option, particularly for small sellers in China,” and the suspension could lead to increased costs for sellers and higher prices for U.S. consumers, Pereira added.
Lawmakers have argued that de minimis imports give Chinese companies an unfair advantage by allowing them to bypass tariffs. Trade officials have also said that de minimis packages are “subject to minimal documentation and inspection.”
Trade organizations and advocacy groups have pushed Trump to curb de minimis shipments because they argue it has allowed illicit drugs, such as fentanyl, to enter the United States through the mail.
If subject to tariffs, it’s unclear if Temu, Shein and other Chinese e-commerce platforms will be able to sustain dramatic growth in the U.S.
Temu and Shein have previously said their business models don’t rely on de minimis. Shein and Temu have opened distribution centers in the U.S., allowing sellers in China to ship goods to the U.S. and store them in local warehouses.
The trend of opening U.S. warehouses for domestic distribution took off last year as major e-commerce companies sought to hedge against further trade restrictions, said Wen Biao, general manager of the Shenzhen-based logistics company Qianhe Technology Logistics.
Biao said his company’s warehouse in Los Angeles saw “explosive” demand, according to a CNBC translation of Wen’s Mandarin-language remarks.
— CNBC’s Evelyn Cheng contributed to this report.
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