- Proposed US policies could impose up to $3.5 million per port call on vessels built in or operated by Chinese entities.
- In 2024, 38% of US port calls were made by Chinese-built vessels and 70% by operators with at least one Chinese-built ship.
- Shipping costs for smaller bulk shipments, like wood pellets, could double, affecting US export competitiveness.
- Japanese bulk carrier owners may play a larger role in US-bound freight, with global shipping costs expected to rise.
The proposals introduce a tiered fee system for vessels calling at US ports, with costs escalating based on their connection to China. A vessel controlled by a Chinese operator could face a $1 million fee per port call, with an additional $1.5 million if it was constructed in China. Companies that own or have ordered Chinese-built vessels may incur an extra $1 million per call, bringing the total fee to $3.5 million in some cases.
In 2024, Chinese operators controlled fewer than 6% of dry bulk vessels calling at US ports, with Greek (17%), US (14%), and Japanese (13%) operators comprising a significant share. However, since a substantial portion of the global dry bulk fleet has been or is being built in China, the policy could considerably influence how trade flows are managed.
Widespread Industry Implications
According to MSI’s analysis, 38% of all dry bulk vessels calling at US ports in 2024 were Chinese-built, while an additional 20% belonged to operators with active Chinese shipbuilding orders. Crucially, 70% of all port calls in 2024 were made by operators that had at least one Chinese-built vessel in their fleet, indicating that the new regulations could impact a broad segment of the shipping industry.
For smaller bulk shipments, such as 28,000-tonne wood pellet cargoes, the $1 million per-call fee would translate into an added $35 per tonne freight cost, nearly doubling transportation expenses to Europe. Although this represents a less extreme increase in the overall CFR (Cost and Freight) commodity price—around $300 per tonne—it could still diminish the competitiveness of US exports.
Future Outlook: Higher Freight Costs and Fleet Redistribution
Will Fray, Director at MSI, noted that while these policies might not directly reduce dry bulk demand, they pose a risk to US export competitiveness and could prompt shifts in global fleet deployment. One potential outcome could be a greater reliance on Japanese bulk carrier owners for US-bound freight. However, given that Chinese-built vessels dominate the global dry bulk fleet and orderbook, the primary effect may be a general increase in freight rates for US trade routes.
As the US considers these regulatory measures, industry stakeholders will need to assess their impact on trade flows, operational costs, and the long-term competitiveness of US exports in the global market.
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Source: Baird Maritime
