President Donald Trump’s tariff pause gives Temu and Shein a temporary window of opportunity to restock U.S.-based warehouses and re-evaluate their supply chain management, experts and insiders say.
On Monday, the U.S. and China agreed to lower tariffs on most Chinese imports to 30% for 90 days. The agreement included a relaxation of the so-called “de minimis” rule, effective Wednesday, which will see low-value packages shipped to the U.S. from China now be taxed at a tariff rate of 54%, down from 120% previously.
Previous tariff rates had driven price increases for U.S. consumers on Shein’s platforms. Meanwhile, Temu halted direct shipments from China altogether, leading to some disruptions in fulfilling its U.S. orders.
But the recent tariff cut has given them a chance to ramp up shipments from China and restock their warehouses and fulfill existing orders, supply chain experts say.
“In the short term, [Temu and Shein] are definitely going to increase their shipment volume to the U.S.,” said Anand Kumar, associate director of research at Coresight Research, adding that it will also help the companies reassess their long-term strategy.
According to Jason Wong, who has been associated with Temu's product logistics in Hong Kong, the company has paused shipments from China after the end of the “de minimis” exemption and relied on U.S. stockpiles to fulfill orders.
Under the latest tariff policy, Wong anticipates that bulk shipments subject to the 30% tariff rate will resume to the U.S., replenishing these stockpiles.
″30% is still high, but compared to 125%, 30% is basically nothing,” he added.
Small values, higher levies
The tariffs situation nevertheless remains more complicated for small-value packages under “de minimis.”
The latest policy update retains a $100 flat fee per postal item, while scrapping a previously planned increase to $200 starting in June, according to an executive order released by the White House on Monday.
According to Wong, for Temu to resume its small-value shipments from China to the U.S., the tariffs still need to be relaxed further — something he expects will happen eventually.
Shein has not said that it is ending direct shipments from China. However, it says on its platform that “tariffs are included in the price you pay.”
The reduction in tariffs on low-value packages shipped to the U.S. from China could therefore result in the easing of some prices, said Coresight’s Kumar.
In anticipation of changes to the “de minimis” exemption, Shein has also expanded its supply chains, building manufacturing operations in countries such as Turkey, Mexico and Brazil. It also reportedly plans to shift production to Vietnam.
Shein and Temu did not immediately respond to CNBC requests for comment.
On May 2, Trump ended the “de minimis” exemption policy, which analysts had criticized as hurting local businesses and disguising illicit fentanyl trade.
The small-package tariff exemption had helped Temu and Shein maintain budget prices on the merchandise they shipped directly from China.
The U.S. government had briefly suspended the exemption in February before reinstating the provision days later, as customs officials struggled to process and collect tariffs on a spate of low-value packages.
U.S. rivals like Amazon, on whose platform many third-party sellers offload products sourced or assembled by Chinese manufacturers, are also expected to ramp up shipments during the 90-day window, trade experts said.
“All the companies are just going to scramble to get everything they can into the country as quickly as they can,” said Cameron Johnson, Shanghai-based senior partner at consultancy firm Tidalwave Solutions. “Everybody’s in the same boat.”
