In a dramatic shake-up of the global e-commerce industry, Temu, the popular online shopping platform known for its low-cost Chinese goods, has announced it will no longer ship products directly from China to customers in the United States. Instead, Temu orders in the US will now be fulfilled by local sellers, marking a significant change in its operating model—and a turning point in how Chinese e-commerce platforms do business in America.
The move comes as US lawmakers close the “de minimis” loophole, which had previously allowed packages valued under $800 to enter the country duty-free. Temu and its fast-fashion rival Shein capitalised on this rule to ship billions of dollars’ worth of goods without paying US import taxes, enabling their ultra-low prices and rapid growth.
However, mounting concerns over unfair trade practices, counterfeit products, and the illegal importation of fentanyl have led both Republican and Democratic administrations to take action. Under former President Donald Trump, and with continued efforts under President Joe Biden, the loophole has now been effectively shut.
With the new rules in place, Temu US has shifted to working with American-based merchants and warehousing stock domestically. The platform claims the change will help “local sellers reach more customers,” but analysts say it’s more about surviving in a market where cheap direct imports from China are no longer viable.
Who Stands to Gain from Temu’s Retreat?
As Temu restructures its US operations, platforms like Amazon and Walmart stand to benefit. With established US supply chains and fulfilment centres, these retail giants can step in to fill the gap for budget-conscious shoppers looking for fast shipping and competitive pricing.
This shift could also lead to price increases across low-cost categories like phone accessories, household items, and fashion, where Temu had previously undercut American competitors.
At the same time, the move reflects broader global trends: the end of ultra-globalised, duty-free retail and the rise of more regulated cross-border e-commerce. It also underlines rising tensions between the US and China, not just politically but economically, as trade policies become tools of national interest and consumer safety.
The Bigger Picture: Sustainability and Global Consumption
This change also invites reflection on global consumption patterns. If one billion people were to reach the same level of consumption as the average American, the strain on global resources would be unsustainable. Producing more food, clothing, electronics, and cars to meet that demand would have dire environmental consequences. The Temu case is a microcosm of a bigger challenge: balancing economic growth with planetary sustainability.
Conclusion
Temu’s decision to stop direct shipping from China marks a turning point in how e-commerce platforms operate in the United States. It’s a win for US regulators and domestic businesses—but a potential loss for price-sensitive consumers. As Temu adapts to new trade rules, the online shopping landscape continues to evolve, with Amazon, Walmart, and other major players watching—and waiting.