Temu ends US imports, moves to local fulfilment model

Understanding the de minimis exemption and why it mattered

The “de minimis” exemption allowed goods valued under $800 to enter the US duty-free. This policy enabled platforms like Temu and Shein to offer ultra-low prices while using air freight to deliver goods to US consumers at near-domestic speeds.

Rather than paying duties, platforms reinvested those savings into fast, cross-border transport. Air forwarders helped make this scalable by consolidating high volumes of low-value shipments, keeping transit fast and costs low.

A Supply Chain Built on Three Pillars

The low-cost cross-border e-commerce model rested on three core drivers:

• Consumer demand for ultra-cheap goods with quick delivery.

• E-commerce platforms that leveraged the exemption to avoid duties.

• Logistics capacity from forwarders and parcel carriers that made rapid fulfilment possible.

Demand at Risk

With de minimis removed, costs rise - either through direct price increases or embedded duty costs. This puts pressure on demand, especially if prices exceed what US consumers are willing to pay or if near-identical products are available domestically.

While platforms may attempt to absorb some of the cost to retain volume, thin margins across both sellers and platforms leave little room to do so at scale.

Temu’s Strategic Shift: Local Fulfilment

Faced with three options—raise prices, absorb costs, or overhaul fulfilment - Temu has chosen the third. As a marketplace (not an inventory holder), it is pivoting to a local fulfilment model:

• Connecting US consumers to goods already in the country, or

• Working with sellers who take on the cost and responsibility of importing goods into the US.

Early indications suggest Temu is no longer moving goods from China into the US - an abrupt departure from the model that fueled its growth. If this shift becomes permanent - and if others follow - much of the airfreight demand generated by cross-border e-commerce over the past 18 months could evaporate.

Implications for Logistics Providers

The end of de minimis increases import complexity, potentially creating value-add opportunities for customs brokers and forwarders to support shippers navigating the new landscape.

However, additional complexity won't offset the decline in shipment volumes. Demand drops mean fewer packages, particularly the small parcels once consolidated and flown in bulk by air forwarders.

• Niche providers heavily reliant on the China–US e-commerce lane, and without broader scale to diversify, are most exposed.

• Parcel carriers and forwarders that scaled up for this trade may now face overcapacity and underutilization.

The removal of the de minimis exemption isn’t just a regulatory tweak - it’s forcing a fundamental realignment of global e-commerce flows. Temu’s swift move to local fulfilment may prove a bellwether for broader industry shifts. For platforms, logistics providers, and consumers alike, the implications are only beginning to unfold.