In bid to save shipyards, US set to charge fees on Chinese ships
According to the USTR, the port fee will be charged for each visit to America, a maximum of five times per ship per year
[NEW YORK] An escalating trade war between China and the United States faces another flashpoint on Tuesday (Oct 14) when Chinese ships will be required to start paying a special fee to dock at US ports.
The move announced by the US Trade Representative (USTR) in April triggered reciprocal measures from Beijing, which will impose similar costs on US ships starting the same day.
The tit-for-tat levies are just the latest in a series of disputes between the world’s two largest economic powers that have roiled financial markets and heightened fears of major disruption to the global economy.
US President Donald Trump massively upped the ante last week when he announced an additional 100 per cent tariff on China and threatened to cancel a summit with Xi Jinping in retaliation for Chinese export curbs on rare earth minerals.
The stated purpose of the US port fees is to address Chinese dominance of the global shipping sector and provide an incentive for building more ships in the US.
The non-partisan Alliance for American Manufacturing has called for the funds raised through the fees to be used in building up a new Maritime Security Fund.
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“The unfair economic practices of China present a sizeable obstacle to revitalising shipbuilding in the United States,” the alliance said in a petition supporting proposed legislation aimed at developing the sector.
A fading industry
According to the USTR, the port fee will be charged for each visit to the US, a maximum of five times per ship per year.
Chinese-made ships will pay US$18 per net ton or US$120 per container, with an increase of US$5 per year for the following three years.
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Vessels owned or operated by Chinese citizens, but not manufactured in China, will be charged US$50 per net tonne, with an annual increase of an additional US$30 for the next three years.
The United States is trying to boost a domestic industry that now represents only 0.1 per cent of global shipbuilding.
The Trump administration also sees US shipbuilding as tied to national security, given that China leads the world in ship manufacturing.
In 2024, former president Joe Biden had tasked the USTR with an investigation to identify “China’s unfair practices in the shipbuilding, shipping, and logistics sectors”.
His successor has kept up that focus. In March, Trump announced the creation of a White House Office of Shipbuilding with the aim of reviving that sector of US manufacturing.
On Friday, Beijing fired back. As at Tuesday, the Chinese government announced, all ships manufactured in the US or linked to an American company would have to pay “special” duties to dock at ports in China.
They would be required to pay 400 yuan (S$73) per net ton, then 640 yuan in April 2026, before further annual increases.
Oil tankers and container ships will be among the hardest hit should China’s port fees targeting US vessels take effect on Tuesday, according to Jefferies LLC.
Nearly 16 per cent of tankers that carry refined products and 13 per cent of those that transport crude oil could be charged hefty fees under Beijing’s latest plan, the Wall Street bank wrote in a note.
The global shipping industry is scrambling to manage the fallout from Beijing’s sudden move. Several shipowners are rushing to review operational risks while putting provisional bookings on hold, according to shipping executives who asked to remain unnamed because of the sensitivity of the issue. Beijing’s announcement has given them little time to adjust, they said.
“We are currently assessing its potential impact on our services calling at ports in China. We will update our customers as soon as further clarification becomes available,” container-shipping giant AP Moller-Maersk said in a statement.
The industry had already been racing to find workarounds to blunt the blow from USTR’s punishing port fees. Now it faces additional challenges from China’s retaliation, which could cause penalties to rack up quickly.
For a supertanker, they could amount to around US$6.2 million. A Capesize bulk carrier hauling iron ore and coal could be hit by up to US$3.8 million in fees, according to shipbrokers. A mid-sized containership could face up to US$180 per twenty-foot equivalent unit in extra charges if departing from the US West Coast.
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