There are signs that third-party sellers on U.S. e-commerce platforms such as Amazon and Walmart are hoarding inventory in Canada in an attempt to circumvent the impact of Trump's tariffs on China.

According to multiple sellers, logistics suppliers and consultants, third-party sellers on these two well-known U.S. e-commerce platforms are trying to transfer goods from China to Canadian warehouses first. The goods they sell range from cheap toys to electrical appliances.

Some of them said that some manufacturers and distributors of Amazon and Walmart's own products, as well as suppliers of companies such as Disney, are also using this strategy.

The Trump administration's previous move to impose high tariffs on Chinese goods across the board has undoubtedly stimulated these actions.

It is reported that the "delaying tactics" of hoarding goods in Canada - using tax-free warehouses, tax breaks and tax refund policies - will still cause sellers to increase costs by about $500 to $600 per container, but these sellers are betting that the White House will sooner or later reduce the high tariffs on Chinese goods.

An executive of a large third-party seller operating on Amazon and Walmart platforms said, "If we believe the US government (which is still a big premise), the current situation may be the worst. We are ready to wait for the situation to ease. This situation will not last forever."

It is worth mentioning that US President Trump and US Treasury Secretary Bessant's attitude towards China's tariffs on Tuesday has begun to ease, which may comfort these third-party sellers.

Trump made a public speech on Tuesday local time. He admitted that the current US tariffs on goods imported from China are too high and the tax rate is expected to be significantly reduced. On Tuesday, US Treasury Secretary Bessant also said at an event of JPMorgan Chase that the tariff war between China and the United States will soon cool down.

There are policies above and countermeasures below?

Amazon and Walmart sell both self-operated goods and allow third-party retailers to settle in. On the Amazon platform, more than 60% of sales come from third-party sellers.

US logistics group Flexport pointed out that there are initial signs that goods shipped from China to Canada increased by 50% last week, which may be an early sign that Chinese goods are diverted to Canada.

U.S. retailers have been looking for ways to ease the pain of tariffs while they grapple with orders already on the way and how to prepare for the critical sales period before Christmas.

One option is to use U.S. bonded warehouses, which allow goods to be stored tax-free for up to five years, but storage space is in short supply due to tight supply in the current trade war.

Canada, on the other hand, allows warehouse operators to apply for tariff exemptions in so-called free trade zones, which include bonded warehouses. Sellers can also apply for tax reductions or refunds if the goods are exported within four years.

Kara Babb, a supplier consultant and former Amazon marketing manager, said the benefit of stockpiling in Canada first is that if tariffs are eventually lowered in the future, it will help retailers avoid paying high shipping costs.

Of course, costs and risks still exist. Nathan Strang, director of ocean freight at Flexport, warned that the strategy of stockpiling in Canada will increase costs and may backfire if sellers are forced to ship to the United States while high tariffs between China and the United States remain. “It could become an additional expense on top of the tariffs you already have to pay.”

But for now at least, Dean Wood, CEO of BorderWorx Logistics, which specializes in U.S.-Canada logistics and warehousing, said some retailers are willing to shoulder the extra costs associated with Canadian imports because it’s still cheaper than paying the current U.S. tariff rate outright.

Wood added that it’s a cash flow challenge but still very valuable for companies trying to hedge their risk.