Australian businesses are under renewed pressure after the US removed a long-standing import concession used by retailers: the de minimis exemption, which had allowed low-value goods to enter the US duty-free.
Since the 10% tariff on most Australian exports came into effect in April, shipments to the US had dropped by 36%. Now, with the removal of the de minimis exemption – allowing goods valued under US$800 to enter the US without import duties – many small and mid-sized businesses are facing a double blow.
While the US has framed the change as a crackdown on Chinese e-commerce giants like Temu and Shein, the reality is many Australian businesses – particularly in the e-commerce retail space – are being hit by the changes.
US tariffs and de minimis rule changes placing renewed pressure on Australian retailers
The removal of the de minimis exemption had immediate repercussions for Australian retailers, who collectively exported $23.8 billion of merchandise goods to the US in 2024.
“There’s been a 36% drop in volume since April in terms of outbound shipments from Australia to the US,” Shippit CEO Rob Hango-Zada told the ABC. “All the tariff changes – and more specifically the de minimis change – have meant that retailers have had to pull back from the US market.”
Australia Post temporarily suspended shipments over AU$150 to the US, leaving retailers unable to fulfil orders. According to the Department of Foreign Affairs and Trade (DFAT), the impact is likely to fall hardest on e-commerce retailers shipping goods that previously qualified for the exemption.
While Australia Post has since resumed sending packages to the US, retailers face other new logistical challenges. Every parcel shipped to the US is now subject to inspection, increasing delays at the border. Some businesses have already paused US sales entirely while they figure out how to respond.
The Australian Government says it is continuing to work closely with Australia Post, Australian Border Force and the US Customs and Border Protection to “assess the impacts on Australians and Australian businesses”.
For Australian businesses exporting to the US, navigating this new environment will likely require a new approach.
Six ways to adapt your export strategy in response to US tariffs
DFAT has advised businesses impacted by the tariffs to think about overhauling their supply chains and exploring new markets. “With rising costs and potential tariff hikes, exporters should consider alternative markets to maintain profitability and reduce exposure to US trade policy shifts,” says DFAT.
DFAT has advised businesses impacted by the tariffs to consider the following:
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consider reassessing their pricing and logistics strategies
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watch for updates from Austrade, Australia Post, the state governments and the US Customs and Border Protection
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hold stock in the US by setting up with a third-party logistics (3PL) warehouse
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set up with a distributor
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do bulk consolidation – hold orders and do a weekly shipment to the US with many orders in one shipment
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amend invoice terms
These adjustments will likely require businesses to invest upfront, whether shifting manufacturing away from China, setting up fulfilment infrastructure offshore, or managing longer cash conversion cycles due to shipping and compliance delays.
That’s where tailored working capital solutions will be critical. Trading internationally always comes with an element of risk – from payment delays to currency fluctuations and credit exposure. Trade finance helps reduce that risk, while unlocking the capital needed to make strategic moves like exploring new markets. It can also streamline cross-border payments, with the ability to pay suppliers in over 72 countries, across 15 currencies.
For Australian exporters, flexibility will define the next phase
The removal of the de minimis exemption and the broader return to tariff-heavy U.S. trade policy have created a challenging new reality for Australian exporters. Businesses that once relied on low-cost parcel shipping are now facing added costs and delays, coupled with a continuing sense of uncertainty about what will change next.
What’s clear is that agility matters more than ever. In this new environment, access to flexible capital won’t be just a nice-to-have for many businesses – it will be a key enabler of timely action. Trade finance gives businesses the confidence to act, helping them manage international risk and shift into new markets without cash flow holding them back.
Challenges in global supply chains are only likely to intensify. Businesses that proactively invest in robust supply chain strategies can safeguard their operations and position themselves for sustainable growth.
Octet’s innovative supply chain financial solutions provide the flexibility and support for Australian retailers to navigate supply chain management issues and challenges, strengthen supplier relationships and optimise cash flow. Get in touch to discover how we can help power your business.
Disclaimer: These comments are only our views and should not be construed as advice. You should act using your own information and judgment. Although information has been obtained from and is based upon multiple sources the author believes to be reliable, we do not guarantee its accuracy, and it may be incomplete or condensed. All opinions and estimates constitute the author’s own judgment as at the date of publication and are subject to change without notice.
