FTZ vs Bonded Warehouse vs Bonded CFS Entry: Smart Duty Deferral Strategies for China Imports in 2025

Update – May 12, 2025:

The United States and China have agreed to a 90-day truce in their escalating trade war, significantly reducing tariffs imposed in recent months. Effective immediately, U.S. tariffs on Chinese goods have been lowered from 145% to 30%, while China has reduced its tariffs on U.S. products from 125% to 10%. This temporary agreement aims to ease tensions and provide a window for further negotiations. While the rollback offers short-term relief, tariffs remain elevated compared to pre-dispute levels, and uncertainties persist regarding a long-term resolution. (source)

For U.S. importers sourcing from China, tariffs remain one of the most pressing cost challenges. With Section 301 duties still impacting a wide range of goods in 2025, companies must adopt smarter customs strategies that balance compliance, flexibility, and working capital preservation.

At Dedola Global Logistics, we specialize in helping clients implement duty deferral strategies tailored to their volume, cargo profile, and financial goals. This article compares three essential tools—Foreign Trade Zones (FTZ), bonded warehouses, and bonded Container Freight Station (CFS) entries—to help you decide which approach fits your 2025 logistics plan.

Foreign Trade Zone (FTZ)

A Foreign Trade Zone (FTZ) is a federally designated site that allows businesses to defer, reduce, or eliminate customs duties on imported goods. It offers the most comprehensive set of duty deferral benefits, especially for importers engaged in value-added processing or distribution within the U.S.

Benefits:

• Deferred Duties: Customs duties are paid only when goods leave the FTZ and enter U.S. commerce.
• Duty Elimination on Exports: No duties are owed on goods that are re-exported from the zone.
• Weekly Entry Consolidation: Multiple shipments can be filed under a single entry, saving on brokerage fees.
• Inverted Tariff Advantage: Finished products with lower tariff rates than components qualify for the lower rate.
• No Duties on Scrap or Waste: Eliminates unnecessary duty payments on unusable materials.

Limitations:

• Requires formal activation, security protocols, and approval by U.S. Customs and Border Protection.
• Setup costs and compliance infrastructure may be too complex for low-volume operations.
• Prohibited from direct-to-consumer retail operations inside the zone.

📘 CBP: About Foreign-Trade Zones

Bonded Warehouse Entry

A bonded warehouse allows importers to store goods without paying duties for up to five years. This strategy is well-suited to businesses that require flexibility on inventory release timing, have slower turnover, or plan to re-export merchandise.

Benefits:

• Long-Term Duty Deferral: Avoid upfront duty payments on inventory that may not sell immediately.
• No Duties on Re-Exports: Goods that are exported from the warehouse never incur U.S. duties.
• Defer Entry Filing: No need to file CBP Form 7501 until goods are withdrawn.
• Ideal for High-Value Inventory: Reduces the financial burden of storing expensive items.

Limitations:

• Withdrawal process requires bonded supervision and additional documentation.
• Not all ports or 3PLs have bonded warehouse facilities available.
• Storage costs can erode savings over long periods.

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Bonded CFS Entry (In-Bond 7512)

Bonded CFS entry is ideal for importers handling LCL (less-than-container load) shipments that need short-term storage or flexible routing. Goods are held at a bonded facility, and customs duties are only due when entry is made.

Benefits:

• Duty Deferral: Delays customs entry and payment until the importer initiates clearance.
• Cost-Efficient for LCL Cargo: Best suited for shared-container shipments or partial loads.
• Low Setup Burden: No need to operate a bonded warehouse—use an authorized third-party CFS.
• Enables Transshipment: Ideal for rerouting or staging goods before final delivery.

Limitations:

• Typically limited to 15 days of storage time.
• Handling fees may be higher due to sorting and devanning.
• Less control over goods compared to FTZ or bonded warehouse options.
• Not suitable for long-term deferral strategies.

📘 CBP: In-Bond Process Overview

Additional Deferral Tools for Dedola Clients

In addition to the formal programs above, Dedola Global Logistics offers importers extra flexibility:

• Port-Side Entry Delay: We can hold shipments at port for up to 15 days before initiating customs entry, offering tactical deferral without committing to warehousing (storage fees apply).
• ACH with Periodic Monthly Statement (PMS): Clients enrolled in PMS with CBP gain up to 45 days of extended duty payment time, improving cash flow and reducing administrative touchpoints.

Conclusion: Choosing the Right Tool for Your 2025 Strategy

Whether you’re managing electronics, apparel, auto parts, or specialty industrial goods, effective duty deferral can significantly impact your total landed cost. At Dedola, we work with each client to develop logistics strategies aligned to operational goals and tariff mitigation priorities.

Is your China import strategy optimized for tariff savings?
Let’s schedule a call to review your current duty exposure and evaluate whether FTZ, bonded warehouse, or CFS entry offers the best path forward.

📞 Connect with a Dedola Advisor