Chinese merchants selling on Amazon face mounting pressure as former President Trump's increased tariffs on Chinese imports reach 125%, up from 104%. The dramatic rise is forcing sellers to make difficult decisions about their future in the US market.
According to the Shenzhen Cross-Border E-Commerce Association, which represents over 3,000 Amazon sellers, the new tariffs are creating an unsustainable cost structure for many Chinese merchants. The association's head, Wang Xin, indicates that sellers must either substantially raise prices or abandon the US market entirely.
The impact is already evident among Shenzhen-based sellers. Some have increased their US prices by up to 30%, while others are planning complete market exits. One merchant reported needing to raise prices by 50% on higher-cost items just to maintain profit margins.
Chinese sellers form a substantial portion of Amazon's marketplace, with more than 100,000 registered in Shenzhen alone, generating estimated annual revenues of $35.3 billion. The tariff increase threatens this ecosystem and could lead to rising unemployment rates in China's e-commerce sector.
The situation is further complicated by the end of the de minimis exemption, which previously allowed items valued under $800 to enter the US without additional duties. Starting May 1, these shipments will face duty rates of 90% or fixed fees ranging from $75 to $150 per item.
Popular Chinese platforms like Shein and Temu, known for their budget-friendly offerings, will also feel the effects of these policy changes. Meanwhile, some US companies welcome the stricter measures, with retailers like Forever 21 having previously blamed duty-free Chinese imports for creating unfair price competition.
The broader implications of these tariffs could reshape the landscape of cross-border e-commerce between China and the United States, potentially leading to higher prices for American consumers and a restructuring of global supply chains.