China’s Yiwu-based merchants slash staff and warehouse space after the de minimis repeal turns cheap‑parcel trade into a money‑losing grind.
Stacks of unsold socks, gloves, toys, and storage boxes now clog warehouse floors in Yiwu—the Chinese city that once sent cut-price trinkets to every corner of the planet.
Cross‑border e‑commerce orders from the world’s biggest small‑commodity hub have plunged by roughly 70 percent since the U.S.–China tariff standoff escalated, a local freight‑forwarding executive says. The shock has hit Yiwu’s merchants and logistics firms so hard that many are teetering on the brink of collapse.
In April, Washington raised average duties on Chinese imports to 145 percent, and Beijing hit back with 125 percent tariffs on U.S. goods.
A fresh blow landed at one second past midnight on May 2, when Washington ended the de minimis exemption that had let parcels valued at $800 or less enter the United States duty‑free. U.S. officials say the loophole allowed China to flood the American market with cheap goods and even smuggle in illicit drugs.
With those parcels now taxed—and Washington and Beijing still locked in the broader tariff standoff—exporters in Yiwu say their business model no longer works.
“It feels like the sky has fallen,” Mr. Lin, a cross‑border seller, told The Epoch Times. Lin supplies the U.S. market through Temu, the overseas arm of Chinese retail giant Pinduoduo, but can no longer make the math work.
“They force you to slash prices, or they fine you for slow movers. In the end, you lose both goods and cash,” he said.
Lin has already cut staff, will vacate his multi‑thousand‑square‑meter warehouse in June, and will move into a space a fraction of the size.
“Our sales are down 50 to 60 percent. I can’t sleep. There’s no way out, so we keep going and hope,” he stated.
Mr. Xu, another Yiwu-based merchant from Henan Province, was blunter still.
“Foreign trade is now the hardest line of work. The U.S. market is dead; small parcels have zero orders. Every day is confusion, anxiety, pain,” he said, adding that he works more than 12 hours a day with no weekends yet sees no path back to growth.
Yiwu hosts more than 20,000 freight‑forwarding companies that once funneled local factory output through nearby Ningbo Port to the United States, according to Mr. Wang, owner of a Yiwu-based international‑logistics company.
Roughly half have shut their doors since the tariff fight began, he told The Epoch Times.
By Sean Tseng
