A sharp drop in air cargo volumes from Asia to the US has followed the Trump Administration’s move to end a long-standing tax exemption for low-value parcels from China.
The change — which took effect on May 2 and closed the so-called de minimis loophole — has caused a double-digit decline in air shipments, according to analysts and industry groups.
Figures from the International Air Transport Association (IATA) show that Asia–North America air cargo volumes fell 10.7% year on year in May. IATA director general Willie Walsh said the data “illustrates the dampening effect of shifting US trade policies.”
Tax Hits Low-Cost E-commerce
The de minimis exemption allowed goods under $800 in value to enter the US tax-free, benefiting low-cost e-commerce platforms such as Shein and PDD’s Temu. These platforms relied heavily on air freight to deliver small parcels to US customers.
Under the new rules, such shipments from China and Hong Kong are now taxed — initially at rates as high as 145%, before settling at around 30% following a mid-May easing of tensions between Washington and Beijing.
The US and China remain in trade negotiations, with the US relaxing some export controls on software, ethane, and aerospace goods. However, a broader round of tariffs is set to resume on July 9, targeting a range of countries.
China’s Exporters Shift Focus
According to consultancy Aevean, low-value e-commerce shipments from China to the US dropped by 43% in May compared with April. At the same time, volumes rose to alternative export markets, including Europe and Southeast Asia.
“The question now is whether these platforms will return to the US market while paying 30% duties instead of none,” said Aevean managing director Marco Bloemen. “But the uncertainty in US trade policy is already pushing businesses toward other markets.”
Consultancy Rotate added that major platforms were quickly pivoting, with notable growth in exports to the EU and Asia-Pacific. Cirrus Global Advisors reported some shippers reducing chartered trans-Pacific freighter flights from three per week to two.
Cargo Capacity Declines
The drop in demand has already reshaped air freight operations. Rotate reported that direct freighter capacity between China and the US in June was 11% lower than in March — erasing gains made over the past year.
Freight forwarder Dimerco Express said its e-commerce volumes fell by around 50% in May and June, prompting ongoing cancellations of scheduled freighter services.
Until recently, low-value e-commerce shipments had fueled booming trans-Pacific air cargo volumes. Aevean estimates that such shipments reached 1.2 million metric tonnes last year — accounting for 55% of China–US air freight, up from just 5% in 2018.
A Controversial Rule Change
The de minimis rule, which dates back to 1938, has been under fire from US lawmakers who argue it allowed Chinese exporters to bypass tariffs and facilitated the entry of illicit goods — including drug precursors used in opioid production.
While the intent of the change is to strengthen enforcement and level the playing field, trade experts warn it may also accelerate the redirection of Chinese e-commerce exports away from the US — potentially reshaping global cargo flows for years to come.