US-China Trade War Escalates: USPS Parcel Suspension & New Tariffs Could Change E-Commerce Forever

The United States Postal Service (USPS) has officially suspended the acceptance of incoming international parcels from China and Hong Kong indefinitely. This sudden decision poses a significant challenge to e-commerce giants such as Shein and Temu, whose business models heavily rely on the seamless import of goods.

Unclear Reasons Behind the Suspension

While USPS has not disclosed specific reasons for the suspension, it confirmed that the flow of international letters remains unaffected. Despite multiple inquiries, no additional details were provided regarding the rationale behind this abrupt halt.

Connection to the De Minimis Exemption Termination

This announcement follows closely after former US President Donald Trump signed an executive order terminating the longstanding “de minimis” exemption. Under this exemption, packages valued under $800 could enter the US duty-free and without extensive customs inspections. The policy change is expected to disrupt the operational models of international e-commerce platforms significantly.

New Tariffs on Chinese Imports

Additionally, a broad-based 10% tariff on Chinese imports took effect on the same day as the USPS suspension. This move is part of the ongoing trade tensions between the United States and China, further complicating the cross-border flow of goods.

Impact on E-Commerce Platforms Shein and Temu

Popular e-commerce retailers Shein and Temu have flourished by leveraging the de minimis rule, enabling them to offer consumers low-cost products with minimal import restrictions. The recent policy changes, however, threaten this advantage. Over a billion packages from China have entered the US under these relaxed regulations, but with new tariffs and the USPS parcel suspension, the cost and delivery time of these products are expected to rise.

China’s Retaliation Against US Tariffs

In response to the new US import duties, Beijing has imposed retaliatory economic measures. These include a 15% tax on certain types of coal and liquefied natural gas and a 10% tariff on crude oil, agricultural machinery, large-displacement cars, and pickup trucks. Additionally, China has introduced new export controls targeting over two dozen metal products and related technologies. Two US-based firms, biotech company Illumina and fashion retailer PVH Group, have also been added to China’s unreliable entities list.

Trade Tensions Between the US and China

Despite previous indications that the leaders of both nations might engage in diplomatic talks, Trump stated he was in “no rush” to communicate with Chinese President Xi Jinping. This uncertainty in diplomatic relations further exacerbates tensions, leaving businesses and consumers in a state of flux.

Potential Delays in International Deliveries

Experts suggest that if all international packages undergo thorough customs inspections due to the removal of the de minimis exemption, delays in deliveries will be inevitable. Currently, US Customs and Border Protection holds the authority to inspect international shipments, though in practice, not all packages are examined. With the new rule in place, international e-commerce deliveries may experience significant slowdowns, affecting businesses and customers alike.

Conclusion: A Major Shift in Global Trade

The USPS parcel suspension, combined with new tariffs and the termination of the de minimis exemption, marks a significant shift in US-China trade relations. These changes will likely reshape global e-commerce logistics, affecting both businesses and consumers. As tensions continue to rise, the future of cross-border trade remains uncertain, with further policy adjustments expected in the near future.