Escalating US-China Port Fees Threaten Maritime Trade

The United States and China began imposing reciprocal port fees on ocean carriers on Tuesday, escalating their trade war and threatening disruptions to global supply chains for goods ranging from holiday toys to crude oil.

China has started collecting special levies on U.S.-owned, operated, built, or flagged ships, with exemptions for Chinese-built ships and empty carriers entering for repairs, according to CCTV. Charges apply at the first port of entry for each voyage or the first five within a year, starting April 17.

The move counters U.S. plans, effective October 14, to impose fees on ships registered in China. Initiated by the Trump administration, based on a Biden-era investigation, the initiative targets Beijing’s apparent dominance in the maritime, logistics, and shipbuilding sectors.

Analysts forecast significant impacts, with Jefferies’ Omar Nokta estimating 13% of global crude tankers and 11% of container ships could be affected. China-owned COSCO Shipping may bear nearly half of the $3.2 billion cost to the container sector by 2026. Shipbrokers warned that this cycle of maritime taxation could distort global freight flows.

A Shanghai trade consultant, speaking anonymously, suggested limited disruption: “What are we going to do? Stop shipping? Companies are adapting despite U.S. trade frictions,” with costs likely being passed on to consumers via higher prices.

Tensions rose last Friday as Trump threatened 100% tariffs on Chinese goods and export controls on critical software by November 1, in retaliation for Beijing’s mineral export curbs. U.S. officials also warned of sanctions, port bans, or extra fees for countries supporting a UN plan to cut shipping emissions, a measure backed by China.

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COSCO’s shares in Shanghai increased by over 2% early Tuesday following the company’s approval of a 1.5 billion yuan ($210.3 million) share buyback to safeguard its value. However, the firm did not comment to Reuters about the fee implications.