‍DALLAS — Cathay Pacific Airways (CX) expects air freight demand between mainland China and the U.S. to weaken due to the impact of new tariff increases and changes to U.S. import rules set to take effect in early May. 

The Hong Kong-based carrier said in a statement on Tuesday that rising trade tensions and regulatory changes would increasingly affect its cargo business.

Reuters cites CX as saying, “We expect a softening of general air cargo demand over the Chinese mainland and the United States due to continuing tariff dynamics and changes to the de minimis rule as of early May.” Anticipating that this dip in trans-Pacific volumes will eventually occur, the airline confirmed it will redeploy its fleet of freighters to other international routes.

The U.S. de minimis exemption, as outlined in Section 321(a)(2)(C) of the Tariff Act of 1930, previously allowed merchandise valued at less than US$800 to enter the country tariff-free, has been a lifeline for Chinese e-commerce giants like Shein and Temu.

On May 2, 2025, the exemption will be lifted, impacting inexpensive shipments from China and Hong Kong. As a result, it is anticipated that the new rule will limit the thousands of entries of goods that can enter the U.S. duty-free, which will largely hurt air freight, whose business is based on such shipments.

Cathay Pacific, which flies out of Hong Kong International Airport (HKG), the world’s busiest cargo hub, has over the past few years taken advantage of booming cross-border e-commerce flows from mainland China. But with U.S. policies changing and geopolitical friction increasing, the airline is now anticipating a reconfiguration of global cargo flows.

Beyond freight operations, the airline cautioned that the latest tariff-related developments could also weigh on demand for passenger travel and add "significantly greater cost burdens" to global supply chains.

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