Non-Chinese operators using Chinese-built ships will be charged the higher amount of either $23 per ton or $154 per 20-foot equivalent unit, whichever is higher. Both fees are imposed on each ship incurring no more than five times a year, according to maritime technology and data provider Alphaliner.
The US is set to introduce port fees on vessels linked to China in one week, a policy that is expected to cost the top 10 shipping carriers $3.2 billion next year, as US President Donald Trump attempts to counter China’s growing dominance in global maritime trade.
Although some analysts believe the October deadline may be extended or cancelled amid ongoing negotiations. The uncertainty has unsettled carriers, adding another layer to the existing geopolitical uncertainty.
The Trump administration is imposing fees on ships built, owned, or operated by Chinese entities. It will be later used to revive the US shipbuilding industry.
Five U.S. labor unions are asking lawmakers to pass a law that would help secure investment in domestic shipbuilding, which will be strengthened by new port fees targeting Chinese vessels.
Starting from October 14, the US will collect fees from ships linked to China that visit American ports. The final rules from the US Trade Representative (USTR) are still pending. HSBC analysts predict that China’s COSCO Shipping is the most vulnerable, costing $1.5 billion in port fees.
The US Trade Representative emphasized that payments must be made via the Treasury Department’s Pay.gov website rather than at the port of entry.
Chinese-owned vessels or those operated by them will have a flat fee of $80 per net tonnage per voyage to the US.
Non-Chinese operators using Chinese-built ships will be charged the higher amount of either $23 per ton or $154 per 20-foot equivalent unit, whichever is higher. Both fees are imposed on each ship incurring no more than five times a year, according to maritime technology and data provider Alphaliner.
After seeing strong opposition from the industry, the USTR reduced the fees from its initial proposal, excluded many US-based operators, and extended the implementation of fees on liquefied natural gas (LNG) carriers.
On Thursday, the Trump administration protected domestic exporters and vessels servicing the Great Lakes, the Caribbean, and US territories from port fees.
The final Federal Register notice posted by the US Trade Representative features a softer version of the February proposal, which had threatened to impose fees of up to $1.5 million per port on China-built ships, unsettling the global shipping industry.
On the other hand, it expanded the policy in such a way that it includes fees for any non-US-built roll-on/roll-off auto carriers, except those flying the US flag.
Alphaliner estimated that the Chinese carrier COSCO, including its subsidiary OOCL fleet, is most exposed to the new fees. The vessels would be charged fees of up to $1.53 billion next year, almost half of the total estimated $3.2 billion for the top 10 cargo carriers.
Many major shipping companies, such as France’s CMA CGM, have responded to the US port fees by asking Chinese-built vessels to reroute to avoid the additional costs.
The move has been echoed in many carriers globally, showing the significant impact of the new fees on global shipping operations. Meanwhile, Beijing has also responded. Premier Li Qiang has recently signed a decree promising to take countermeasures if Chinese ships or crews face any discriminatory measures, amid a potential increase in trade tensions.
President Donald Trump and Chinese President Xi Jinping are scheduled to meet at the Asia-Pacific Economic Cooperation (APEC) summit in South Korea from October to November 1, where the shipping and trade issues are expected to be discussed.
Last year, US shipyards constructed fewer than 10 commercial ships, while Chinese shipyards built over 1,000, serving both commercial and military purposes.
