In the Spring of 2024, under the Biden Administration and at the request of several US unions, the United State Trade Representative (USTR) opened an investigation under Section 301 authority into Chinese shipbuilding and logistics practices. The report with actionable findings was issued in January 2025. It was then up to the incoming Trump administration and newly appointed Trade Representative to decide what action would be taken. The Trump USTR office has proposed fees and cargo preference rules summarized here. The government is accepting public comments on the proposal up until 24 March at which point a public hearing will be held. In its proposed form, the fees are substantial. Organizations such as the World Shipping Council and BIMCO, along with various maritime industry stakeholder firms and trade associations are putting forward comments to the USTR office.
Customer advice
We have already started receiving clause wording from MPV carriers to be incorporated in their booking notes that will place any cost and operational risk on the account of the Merchant/Charterer. The market should also expect surcharge notices from container carriers.
Drewry believes that more than 80% of current container ships calling at US ports would be hit by US tariff fees as they are envisaged, either because the operator is based in China, the ships are built in China, or the operator has ordered ships in China.
As regards the MPV-Heavy Lift vessels, some estimates show that up to 85% of the tonnage is Chinese-built. Exact ratios regarding specific owners' fleets vary with some owners having a majority of their fleets built outside China – for instance with some of the specialist forest product carriers.
We will continue to monitor the situation and keep clients updated on the subject and proposed surcharge wording we receive from shipping lines, and will see if there is any news on 24 March 2025.
USTR proposed fees for vessel calls at US ports
According to the USTR proposed action, upon the entrance of a Chinese-built vessel to a US port, a fee is to be charged to that vessel’s operator on the international maritime transport provided via that vessel in three ways:
- Service fee for Chinese maritime transport operators. Charged at a rate of up to $1m per entrance of any vessel of a Chinese operator to a US port or per entrance of any vessel of that operator to a US port at a rate of up to $1,000 per net ton of the vessel’s capacity.
- Service fee on maritime transport operators with fleets comprised of Chinese-built vessels. A fee will be charged to that operator at a rate of up to $1.5m or based on the percentage of Chinese-built vessels in that operator’s fleet. For operators with 50% or greater of their fleet comprised of Chinese-built vessels, the operator will be charged up to $1m per vessel entering a US port.
For operators with greater than 25% and less than 50% of their fleet comprised of Chinese-built vessels, the operator will be charged a fee up to $750,000 per vessel
For operators with up to 25% of their fleet comprised of Chinese-built vessels, the operator will be charged a fee up to $500,000 per vessel.
- Service Fee on maritime transport operators with prospective orders for Chinese vessels. An additional fee will be charged to operators based on the percentage of vessels they have ordered from Chinese shipyards. For operators who have 50% or greater of their vessel orders in Chinese shipyards or vessels expected to be delivered by Chinese shipyards over the next 24 months, the operator will be charged up to $1m per vessel entrance to a US port.
For operators with greater than 25% and less than 50% of their vessel orders in Chinese shipyards or expected to be delivered by Chinese shipyards over the next 24 months, the operator will be charged up to $750,000. For operators with up to 25% of their vessel orders in Chinese shipyards or expected to be delivered by Chinese shipyards over the next 24 months, the operator will be charged up to $500,000.
- Cargo Preference. The current proposal also introduces a progressive cargo preference requirement, mandating that U.S. exports gradually shift to U.S.-flagged vessels – from 1% immediately to 15% within seven years. Up until now, cargo preference rules only apply to U.S. government owned or government-financed cargoes – ex DOE funded, Military, and ExIm financed goods. This would be the first time the government would implement any type of purely commercial cargo preference program. There is a concern about US flag vessel availability with preference laws.
Container Carrier Exposure
Of the 8,775,208 total TEU arrived at U.S. ports in 2024, 1,507,717 TEU (17.18%) were transported by Chinese-built vessels.
Maersk: 2,020 annual U.S. port calls with 27.68% Chinese-built vessels, subject to approximately $750,000 per port call for Chinese-built vessels.
CMA CGM: 1,469 annual U.S. port calls with 35.91% Chinese-built vessels, subject to approximately $750,000 per port call for Chinese-built vessels.
COSCO: 838 annual U.S. port calls with 52.19% Chinese-built vessels, subject to fees up to $1 million per port call as both a Chinese operator (Category 1) and for Chinese-built vessels (Category 2). COSCO's Neo-Panamax+ vessels (3.5M TEU total capacity) face the highest per-vessel fees at approximately $145,407 per DWT ton. Vessel size significantly impacts fee exposure under the tonnage-based calculation option, and the average fee for COSCO vessels calculated by tonnage could reach $125,306 per port call.
X-Press Feeders: 506 annual U.S. port calls with 40.94% Chinese-built vessels, subject to approximately $750,000 per port call for Chinese-built vessels.
Source – Vesselbot.com
Key Container Trade Potential Impacts according to World Shipping Council
- Fees of $1m-$3.5m per US port call rotation. The fees will result in fewer port calls, particularly to medium and small ports. A container vessel servicing the US typically stops at 3-4 U.S. ports on each trip
- Fees could add $600–$800 per container (TEU) for goods moving in and out of the US, hitting farmers particularly hard
- 98% of all US port calls could be subject to fees under these proposals because these fees apply not only to Chinese-built ships but also to any operator with a Chinese-built vessel in its fleet or on order
- These fees amount to an additional tax on American consumers of up to $30 billion annually
- The cost to ship US exports could double
- $1 trillion in imports could be impacted
- The majority of proposed fees would apply to existing vessels or vessels under construction, which would not disincentivize current shipbuilding practices.
We will keep updating this announcement in line with recent market news and developments.
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