Industry News

With the USTR fees on Chinese built and owned vessels calling US ports on the backburner until at least November international shipping now faces the possibility of much more universal fee.

The Trump administration’s much vaunted Maritime Action Plan finally saw light of day at the end of last week in the shape of a 36-page pdf document. Prefacing the document The White House stated, “the United States is decisively moving towards a new Maritime Golden Age by expanding commercial shipbuilding capacity”.

There is also a quote from President Trump saying, “We will soon revitalize our once great shipyards with hundreds of billions of dollars in new investments and people coming from all around the world… to build ships in America.”

Well, its certainly not short on ambition and may refocus efforts by the administration on the maritime sector which seemed to have gone off the boil somewhat into the second half of 2025, something that was noted by speakers at the recent Capital Link event in New York.

Revitalising the US shipyard industry is not be a cheap endeavour and would require hundreds of billions of dollars of investment. 

Some of this money would come from a $150 billion of inward investment which is highlighted in the action plan. This would come from a promised in a deal struck between the US and South Korea last August. Much of this number remains to be fulfilled with the largest commitment so far coming from Hanwha in the shape of a $5 billion investment in the expansion of Philly Shipyard, which it owns, to boost production capacity to 20 vessels a year.

Previously one of the funding mechanisms for shipbuilding revitalisation plans came from the now suspended USTR port fees on China-built and Chinese-owned and operated vessels. These were followed by retaliatory fees from China against US linked ships and eventually led to a 12-month moratorium on the charges by both nations until November this year.

However, the Maritime Action Plan proposes a new set of fees which would be of much wider impact than the USTR port fees as they would cover all internationally built vessels calling the US ports. These fees would impact the vast majority of ships calling with the only exceptions being those built under the Jones Act, however, those operate mainly on domestic trades.

Unlike the USTR fees that were calculated on net tonnage of the vessel the new proposed charges would be based on import cargo weight. The action plan did not set out an exact fee but gave two examples - a fee of 1 cent per kilogram on foreign-built ships would yield roughly $66 billion in revenue over ten years and a fee of 25 cents per kilogram would yield close to $1.5 trillion in revenues over a decade.

In its weekly newsletter container shipping analyst Alphaliner said that at the low end the charges add several hundred thousand dollars per string, and several millions at the high end. “The latter would far exceed the USTR fees,” it noted. And if you’re thinking of transhipping overland from Mexico and Canadian ports there would a land-based tax to cover those imports. Not to mention even without such a tax the amount of port capacity available in those two countries would be quite limited.

The International Chamber of Shipping (ICS) voiced its opposition to the proposed fees saying they “would represent a substantial additional cost burden on maritime transport”.

On practical level the proposed fees would provide more of a level playing field than the USTR port charges as pretty much every international trading ship calling the US would have to pay them regardless. Vessel redeployments and similar measures taken for the USTR fees would make no difference.

With the fees being charged on all imports it should prove relatively easy for shipping companies to pass these costs on to their customers via surcharges and the like, who ultimately would pass them onto US consumers, much has been the case with the tariffs where an estimated 90% of the additional cost has been borne by consumers. 

The bad news in all of that for shipping companies is that more costly goods will reduce US consumer demand, and therefore imports and shipping volumes into the country, an impact that is already been seen from tariffs at the likes of the Port of Los Angeles.

So, Trump’s Golden Maritime Age could well prove costly to international both monetarily and business volume wise.

To read it in seatrade-maritime.com : click here

Image Courtesy: The White House