It is estimated that as much as 70 percent of newbuild container ship orders to 2030 have been placed with Chinese yards, so any penalties could badly affect all shipping lines not just Chinese ones. The end result would likely be higher prices for American consumers on top of those expected to result from whatever trade tariffs President Trump manages to impose on imports.
USTR said in a report in January on a probe launched during the Biden administration that China increased its share of global shipbuilding tonnage from 5 percent in 1999 to over 50 percent in 2023 because of “massive state subsidies and preferential treatment” for state-owned enterprises that are squeezing out private-sector international competitors. The agency said that US shipyards were building 70 ships in 1975, but just five a year today.
A Federal Register notice published on 21 February detailed the proposed fees and other shipping restrictions. The agency has scheduled a public hearing on the remedies.
The probe was launched in April 2024 at the request of the United Steelworkers and four other unions, and conducted under Section 301 of the Trade Act of 1974, as a way to rebuild an industry that has been in steep decline since the 1970s, when Japan and South Korea dominated shipbuilding. The results of the probe were announced last month, just days before Donald Trump was sworn in as president.
The proposed remedies include port entrance fees of up to $1 million per vessel owned by Chinese maritime transport operators. Alternatively, the US would charge $1,000 per net ton of a vessel’s cargo capacity.
Non-Chinese maritime transport operators operating Chinese-built ships would pay up to $1.5 million per port entry, according to the notice. Those with greater than 50% Chinese-built fleets would pay $1 million per vessel entry regardless of origin. The fee would fall to $750,000 if the Chinese fleet percentage was between 25% and 50% and to $500,000 if under 25%.