ZHEJIANG, East China — Nie Ziqin had spent weeks preparing to leave the U.S. market behind. With tariffs skyrocketing, clients backing out of deliveries, and millions in inventory lying idle, she shifted focus to European buyers, repackaged stock for domestic retailers, and covered travel costs to attract new clients.

Then, on May 12, the U.S. announced a 90-day suspension of tariffs on Chinese imports. Within hours, American clients were asking if production could resume before the window closed again.

“It felt like a significant weight finally lifted off my shoulders,” 40-year-old Nie tells Sixth Tone.

The tariff cut — which dropped rates from as high as 145% to 30% — is only temporary, but for exporters in Yiwu, the world’s largest wholesale market for small consumer goods, it’s enough to get business moving again.

With thousands of businesses — many family-run — supplying international buyers, the city in eastern China is built around fast turnaround times and low minimum orders. In May, that means seasonal products for fall and winter: everything from ghost masks to tinsel garlands.

For many exporters, though, the real deadline comes well before the 90-day reprieve ends. To reach U.S. shelves in time for Halloween and Christmas, goods must leave China by July, giving factories just a few weeks to restart production, clear backlogs, and move inventory before tariffs potentially return.

Trade experts say the tariff pause offers a short-term window to clear inventory, but warn that uncertainty remains — particularly for Yiwu’s small- and medium-sized exporters, who are more vulnerable to sudden policy shifts.

Many have already begun adjusting their strategies. One key approach is to reduce reliance on the U.S. market in favor of more stable buyers in Europe, Southeast Asia, and domestic retail chains.

Some are offering discounts, modifying product designs, or ramping up spending to attract new clients. Others are expanding e-commerce channels or targeting Belt and Road Initiative partner countries, aiming to offset reliance on large-volume U.S. orders that can be delayed or canceled without warning.

“U.S. trade protectionism and strategic competition with China are long-term trends that will continue to constrain bilateral trade,” says Wu Qisheng, a researcher at the Shanghai Academy of Social Science. “The old model of China-U.S. economic ties is gone — and so is the way foreign trade firms once did business with the U.S.”

Window of opportunity

In the weeks before the truce, steep tariffs had left Nie with more than 20 million yuan ($2.8 million) in unsold Halloween stock — ghost masks, plastic pumpkins, light-up skeletons, costumes, all boxed and waiting.

“If it weren’t for the earlier disruption, a batch of goods worth 80,000 yuan would have already been in the U.S.,” Nie says. She also has two additional U.S. orders worth over 800,000 yuan and 1 million yuan still in production.

Shipping from Yiwu to the U.S. takes 45 to 60 days, with goods needing to arrive in time for the holiday retail season. “These goods all need to be completed and shipped before July,” she says. “The factory is now working nonstop to meet the deadlines.”

That urgency echoed across Yiwu. Exporters began pulling stalled orders off shelves and restarting production lines, hoping to move as much inventory as possible before the 90-day window closed.

The rebound was overwhelming. As shipments piled up, bookings for China-U.S. ocean cargo surged, with exporters describing a scramble for space. “Some clients are even calling to beg us not to sell their goods to others while they search for containers,” says Nie. “Whoever secures a container first gets priority for shipment.”

Within two days of the tariff announcement, China-U.S. freight bookings spiked nearly 300%, according to tracking firm Vizion. A separate industry report confirmed the rebound, but warned: “Capacity has not yet fully recovered to pre-tariff-war levels, leading to tight space and a sharp rise in spot booking rates.”

A few, however, had moved early enough to avoid the rush. Gong Yongqiang, a Christmas decorations exporter, had already shipped his U.S. orders by early March and paused production once tariffs rose to avoid excess stock.

“The timing caught everyone off guard,” he says. “March to May is a key window for Christmas exports. No one expected the hike to hit that fast.”

His American clients — who make up a fifth of his business — have since asked to resume. But his factories are now booked with orders from South America.

“We may not be able to meet the demand in time. This 90-day window actually doesn’t mean much for us,” he says. “If the customer’s timing works, we’ll take the order. If not, we won’t do it.”

Exit strategy

While the 90-day tariff suspension gave Yiwu exporters like Nie just enough time to move stalled inventory, the pivot away from the U.S. was well underway.

“I couldn’t wait around for U.S. clients to make up their minds,” she says. “Waiting would’ve killed the business.”

By April, Nie was offering discounts to European buyers, covering travel costs to bring in new ones, and shifting her product line to meet different compliance standards.

She hoped to push the EU share of her exports from 30% to 50%, while keeping U.S. orders capped at 30%. At the same time, Nie was expanding into China’s holiday retail market. And since late 2024, she had also been developing a new line for the domestic market.

One afternoon in May, a week before the tariffs were suspended, her less-than-10-square-meter storefront was packed with buyers from India, Peru, and Colombia. The Peruvian clients, preparing for their own Halloween season, were interested in dozens of items — masks, garlands, light-up decorations.

Her staff crouched on the floor, writing out wholesale prices and minimum order quantities for each product, until there was barely room to move.

Built around rapid turnaround times and small-batch flexibility, the city’s supply chains allow merchants to move between markets faster than most. Many store owners run their own factories or work directly with workshops and factories in provinces nearby, making it easier to test new products or retool for different buyers.

“Many Yiwu stores have their own factories,” says Wu, the researcher at the Shanghai Academy of Social Science. “Their competitive edge lies in high efficiency and quick response to customer needs.”

But speed only goes so far. Zheng Wenping, an associate professor at the University of International Business and Economics, estimates the tariff truce may last less than 90 days — “possibly only 30 to 40” — before tariffs return. “We have to put ‘pause’ in quotation marks,” he says. “No one knows when the tariffs might be reinstated.”

That uncertainty is why many exporters are turning short-term caution into long-term strategy — building out new markets not just to survive the next shock, but the next decade. “High tariffs from the U.S. are likely to remain a lasting reality,” says Wu.

It’s one of the reasons many exporters are now limiting U.S. orders to short-term cycles, while building out steadier business in other markets.

“From a long-term perspective, these negotiations are a wake-up call,” says Wu. “We cannot rely too heavily on a single market. The U.S. trade policy isn’t a short-term issue — it’s a long-term trend.”

Margins and markets

But even as exporters look elsewhere, few believe those markets can fully replace what the U.S. offers: Large, consistent orders with fast turnaround and reliable payment cycles.

According to Yiwu’s Bureau of Commerce, exports to the U.S. reached 83.57 billion yuan in 2024 — up 42.5% year on year and accounting for 14.2% of the total. The next four largest export markets — India, Mexico, Brazil, and Iraq — accounted for a combined 91.62 billion yuan, or 15.6%.

“In Yiwu, American customers aren’t actually that numerous, but when they come, they usually place large orders,” says Gong. “Compared to smaller buyers, these orders are easier to fulfill — large quantities streamline our production.”

According to Zheng, that scale has a direct impact on cost. “Yiwu’s system is largely driven by market demand to reduce cost,” he says. “If a large-scale market like the U.S. disappears, it will make business difficult.”

And while orders from developing markets may help fill gaps, many exporters say buyers in countries like India or parts of Africa are slower to pay — and less reliable when cash flow is tight.

Nie had started pulling back from the U.S. even before the latest tariffs. By late 2024, she was expanding into China’s holiday market, developing Spring Festival decorations for local supermarket chains.

She launched her business in 2007 with handmade Halloween masks in a rented apartment. Today, she runs a 20,000-square-meter factory, employs hundreds, and offers nearly 200 product lines. She’s faced her share of disruptions and carried much of the pressure herself.

“Every hurdle feels tough, but we surmount them one by one. Things are getting better day by day, year by year,” Nie says.

This year’s tariff turbulence is just another.

“If our export business doesn’t do well this year, we’ll focus on our Chinese New Year product sales,” she says. Her team also plans to launch cultural and creative lines aimed at China’s growing consumer base.

“We’ll do what we can. If American clients buy, great. If not, we’re prepared,” she adds. “If the West goes dark, the East will shine. If not the East, then somewhere else will.”

Editor: Apurva.

(Header image: Nie Ziqin at her storefront in Yiwu, Zhejiang province, May 2025. Ding Rui/Sixth Tone)