Editor’s Note: Prior to publishing, the United States and China met to discuss ongoing trade policies. From the meeting, China agreed to open up more critical mineral trade, prompting the United States to reduce its Fentanyl tariff by 10%. The new overall Chinese import tariff is 47%, down from 57%.
Additionally, both sides agreed to a one-year suspension of port fees on both sides. While the agreement is largely considered good for the industry, experts warn that the trade relationship between the two countries is fragile and could change quickly.
—
This sounds like déjà vu, but life for importers, port operators, and supply chain directors is getting harder.
Each day, the United States imports millions of dollars’ worth of goods and materials through its various ports. However, several new fees levied against Chinese imports could make goods more expensive, putting strain on companies throughout the supply chain.
If you’re wondering what happened, we have to follow the thread back to March 2024.
The process began when five national labor unions approached the Office of the United States Trade Representative (USTR) about potentially unfair behavior by China.
In their complaint, the labor groups alleged China was hurting U.S. interests by dominating the maritime, logistics, and shipbuilding sectors. As a result, they urged the USTR to investigate and figure out how much damage was occurring.
A year later, on April 17, 2025, the USTR had collected its findings and came to a decision. What it had found during its discovery was that China’s behavior in the global market did several things, including:
As a result, the agency issued actions against China, citing Section 301 of the Trade Act of 1974. In its announcement, the USTR said China was responsible for “unreasonable acts, policies, and practices to dominate the maritime, logistics, and shipbuilding sectors.”
April’s announced action set the tone for new fees meant to do two things: reduce China’s influence and boost U.S. companies.
Let’s cover the easy topic first–boosting domestic companies and industries. As with other recent actions taken against China, the goal is to reduce the country’s gigantic global footprint.
China, for its part, is a large-scale international shipbuilding hub. By instituting new fees on Chinese-made and owned vessels, the U.S. hopes to generate demand for its ships. In turn, it may bolster the domestic shipbuilding industry, which isn’t subject to the fees, and improve the U.S. supply chain.
As for the fee part of the U.S. Trade Representative’s April 2025 action, we’ve officially gone from the warm-up stage to the implementation stage.
For the first 180 days, ships docking at American ports didn’t have to worry about the fee. However, the first round of port fees kicked in on October 14, 2025, and must be paid before Chinese-linked ships can dock. More importantly, depending on the vessel and the operator, the fees those companies pay could change.
Chinese Owners and Operators, based on net tonnage: The fee is $50 per net ton (NT) and will increase to $80/NT on April 17, 2026. The action caps fees at five charges per vessel, per year.
Operators of Chinese-built ships, based on net tonnage or containers: Operators pay the higher fee of either $18/NT or $120 per container (TEU equivalent). On April 17, 2026, the cost rises to $23/NT or $153 per container. The action caps fees at five charges per vessel annually.
Fees on Foreign-built car carrier vessels, based on capacity: The initial cost is $46/NT, and replaces another proposal based on car equivalent units (CEU). This fee applies to all foreign-built carriers, including roll-on/roll-off ones.
After three years, another USTR regulation kicks in targeting liquified natural gas (LNG). This action places limited restrictions on foreign vessels exporting LNG, with increasing limitations over the next 22 years.
Starting in April 2028, one percent of exported LNG must be on U.S.-operated and U.S.-flagged vessels. The percentage slowly grows over time before capping at 15% in 2047.
Although there are a lot of moving parts, the action’s aim is simple: to protect long-term U.S. interests.
China has a massive hand in global supply chains, which the U.S. believes gives it an unfair advantage. Fees, restrictions, and other actions give the U.S. an opportunity to reclaim lost demand and return domestic shipbuilding to prominence.
Of course, we’re likely to experience far-reaching impacts across the global supply chain, too. Whenever there are changes to international trading rules, it’s common to see supply and demand take a hit.
With that said, there are two things we can already expect.
Anytime superpower nations have trade disagreements, you can count on supply chain ramifications, including price hikes.
Shipping companies are looking for ways to avoid fees from the U.S. and China, which instituted its own fees in response. Shipments from China have ended up in nearby countries like South Korea for transshipment. On the flip side, shipments from the U.S. are doing the same, transferring cargo to Chinese ships for delivery to avoid fees.
“No matter how we slice it, rising costs hurt the supply chain,” Kris-Tech’s Supply Chain Director, Marcus Tagliaferri, said. “Typically, companies pass higher costs down the line, ultimately for end users to bear. In this case, the rising costs start with the shippers, but will trickle down to manufacturers, distributors, and others.”
As both the U.S. and China ramp up their respective shipping fees, supply chain and logistics teams need to know who they’re working with.
Chinese-flagged ships and operators face higher costs when importing into the U.S. Meanwhile, U.S.-flagged ships and operators face similar concerns exporting to Chinese ports. One way to avoid some of the hassle is to look toward industry partners for support.
“For organizations relying heavily on importing and exporting, one strategy may be to build relationships with a variety of shipping partners with the intent of diversifying to reduce cost risk,” Tagliaferri explained.
This means looking for partners operating ships from Japan, South Korea, Europe, the U.S., or other countries. It also means potentially finding shipping routes that avoid hotspots and being more creative with logistics.
But as the old saying goes, it takes two to tango, and the U.S. has found a powerful partner to dance with.
Commercial shipbuilding is the latest battleground in the U.S./China trade war, but the tension has smoldered for years. And as soon as the USTR issued its action, China instituted its own fees on U.S.-owned and operated ships pulling into its ports. Citing the United States’ approach, China issued port fees of 400 yuan or $56/NT on U.S.-owned, operated, or flagged ships. And just like their American counterparts, China’s fees increase incrementally each year through 2028.
But the ongoing fee situation isn’t all bad news. As part of the USTR’s push for more domestic production, the U.S. is offering fee remissions. Fee remissions are ways to reduce costs for shippers, but only if they meet certain criteria. In this case, the U.S. will reduce or forgive port fees for operators if they order a U.S.-built ship.
Officials hope operators jump at reducing their port fees while also spurring demand for U.S. shipbuilding. While the idea makes sense on paper, it could take years to fully kick in. We also face the possibility of operators “waiting the situation out” to see what happens in the next election.
If port fees weren’t enough, the USTR also announced 100% tariffs on ship-to-shore (STS) cranes, cargo handling equipment, and intermodal chassis and parts. This action was part of President Trump’s Executive Order 14269, Restoring America’s Maritime Dominance.
According to the USTR notice, STS cranes marked for the tariff are either Chinese products or contain components made in China. Additionally, the importer must have proof that the crane wasn’t built in China; otherwise, it will be declared a Chinese product.
The 100% tariffs kick in on November 9 and may rise even higher for other port-related products and materials.
Surprisingly, these aren’t the only tariffs China is subject to, though this one isn’t related to Section 301. The Trump administration says it will impose new 100% tariffs on all Chinese imports beginning November 1. President Trump noted the new tariffs will stack on top of any tariff already in place. This move is in direct response to new Chinese controls on rare earth exports.
For reference, everything from lithium batteries and graphite anodes to military products and everyday tech has rare earths. The United States is heavily dependent on many of the 17 elements, making restrictions particularly dangerous.
With so many moving parts, it’s sometimes difficult to figure out the next step. However, American companies can make some calculated decisions to limit impacts.
Look for ships owned or operated by other countries. If the ship doesn’t have a connection to China, it can avoid the USTR Section 301 fees. In this case, look for ships from countries like South Korea or Japan, or search out European options.
Surprisingly, China, Japan, and South Korea have a stranglehold on the current shipbuilding fleet capacity–roughly 90%. Although China controls the majority, there are still other shipping options available, especially U.S.-flagged, owned, and operated vessels.
Adjust shipping routes to find alternatives. Alternative routes are possible, but companies might have to get creative. This may involve using shorter routes through short-sea shipping or importing goods using nearby ports in other countries.
For example, companies may choose to truck materials into the U.S. from Canadian or Mexican ports to avoid fees. Short-sea shipping, as the name implies, involves voyages less than 2,000 nautical miles from certain U.S. ports. In this case, vessels are exempt from the Section 301 fees.
As we know, conditions can change in an instant.
Follow developments closely to adjust logistics and supply chain processes and build relationships with diverse shippers and supply chain specialists. Their perspectives and knowledge make it easier to understand and effectively work with new and changing fees and tariffs.
Unfortunately, geopolitical tensions and trade conflicts are tough to gauge, and regulations can change or disappear as discussions occur.
In the meantime, we’re all aboard for the ride.