A sharp increase in tariffs on small parcels from #china to the U.S. has caused a supply slump, impacting giants like Shein and Temu. In May, trade volume dropped to $1B — the lowest since early 2023.
🤔 What happened
⚫ As of May 2, the duty exemption for parcels under $800 (the “de minimis” rule) was removed
⚫ New #Tariffs reach up to 54% on clothing, household goods, and electronics
⚫ Shein and Temu raised prices and saw double-digit sales declines
⚫ Chinese sellers are now forced to use warehouse shipments — with costs reaching tens of thousands of yuan
📌 Why it matters
⚫ Hundreds of thousands of #Chinese sellers are losing their cheap gateway to the U.S. market
⚫ Competition is shrinking — consumers face higher prices
⚫ Small parcel volume to the U.S. dropped 40% year-over-year
⚫ Winners include markets like Malaysia, Belgium, and South Korea, where exports are rising
“This is a lose-lose — for both sellers and consumers,” says Wang Yuhao, founder of Shantivale.