US-China Maritime Trade War: New Port Fees Threaten Global Shipping Disruption

US, China To Roll Out Tit-For-Tat Port Fees, Threatening More Turmoil At Sea

Gantry cranes stand near shipping containers at Yangshan Port outside of Shanghai, China. (File)

Beijing/Los Angeles:

The United States and China will begin implementing reciprocal port fees on ocean shipping companies Tuesday, affecting transportation of goods ranging from holiday merchandise to crude oil, effectively making maritime commerce a significant battleground in the trade conflict between the world's two largest economies.

Earlier this year, President Trump's administration announced intentions to impose fees on China-linked vessels as part of efforts to reduce China's dominance in global maritime industries and strengthen US shipbuilding. These penalties were made possible following an investigation during the Biden administration that concluded China employs unfair practices to control global maritime, logistics, and shipbuilding sectors.

The US is set to begin collecting these fees on October 14. According to analysts, Chinese-owned container carrier COSCO is expected to bear the heaviest burden, potentially facing nearly half of the container segment's projected $3.2 billion in fees by 2026.

In retaliation, China announced last week it would impose its own port fees on US-linked vessels, also effective Tuesday. Jefferies analyst Omar Nokta observed that 13% of global crude tankers and 11% of container ships worldwide would be affected by these measures.

"This tit-for-tat symmetry locks both economies into a spiral of maritime taxation that risks distorting global freight flows," noted Athens-based Xclusiv Shipbrokers Inc in their research assessment.

In a further escalation responding to China's restrictions on critical mineral exports, Trump threatened on Friday to impose additional 100% tariffs on Chinese imports and implement new export controls on "any and all critical software" by November 1.

Administration officials later warned that countries supporting the United Nations' International Maritime Organization's plan to reduce greenhouse gas emissions from shipping could face sanctions, port bans, or punitive vessel charges. China has publicly expressed support for the IMO plan.

"The weaponisation of both trade and environmental policy signals that shipping has moved from being a neutral conduit of global commerce to a direct instrument of statecraft," Xclusiv concluded.

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