- U.S. LNG, Auto Exporters Get Relief as USTR Revises Foreign Ship Fees.
- Revised USTR Rules Lower Costs for LNG and RoRo Operators.
- Shipping Industry Wins Concessions in U.S. Maritime Fee Rollback.
The U.S. Trade Representative (USTR) has made some adjustments to its proposed rules regarding port fees for liquefied natural gas (LNG) tankers and car carriers that aren’t built in the U.S. This change is part of a larger effort by Washington to lessen China’s grip on global shipping and to encourage domestic shipbuilding, reports Reuters.
Key Changes in LNG Shipping Regulations
The updated proposal, which was released on Friday, removes penalties for LNG exporters who don’t use U.S.-built vessels for a portion of their shipments. The initial rules faced significant pushback from the LNG industry when they were first introduced back in April. Additionally, USTR has eliminated the language that hinted at the possibility of suspending LNG export licenses if certain requirements weren’t fulfilled. Previously, the rules required LNG producers to start transporting 1% of their exports on U.S.-built ships by April 2029, with that percentage set to rise to 15% by April 2047.
“This is a step in the right direction, and we look forward to working with USTR on a solution that ensures U.S. LNG remains competitive on the global stage,” said Rob Jennings, vice president of natural gas markets for the American Petroleum Institute.
Car Carrier Fee Adjustments and Exemptions
The U.S. Trade Representative (USTR) has decided to roll back some of the hefty port fees initially planned for non-U.S.-built vehicle carriers, commonly known as roll-on/roll-off ships, or RoRos. Initially, the fee was pegged at a staggering $150 per car capacity, which could have hit hard for typical Ro-Ros that can transport up to 5,000 vehicles. Thankfully, the revised plan has slashed that fee down to $14 per net ton.
On top of that, car carriers that support the U.S. military through the Maritime Security Program (MSP) are now off the hook. The USTR had previously come under fire for applying these fees even to U.S.-flagged and U.S.-crewed MSP vessels.
Ongoing Industry Concerns and Lack of Consultation
The shipping industry was caught off guard by the original proposals rolled out in April. Critics are voicing concerns that the USTR overstepped its bounds by imposing fees on ships built in countries that weren’t part of the Biden administration’s investigation into China’s trade practices.
Shipping groups and legal experts are worried about the broad interpretation of the term non-U.S.-built when it comes to vehicle carriers. The World Shipping Council, which represents major car carrier companies like Norway’s Wallenius Wilhelmsen, has yet to weigh in on these revisions.
Impact on U.S. Exporters and RoRo Operators
These new fees are piling on top of the existing 25% tariffs on auto imports that were put in place during the Trump administration, primarily affecting European car manufacturers. U.S. companies also depend on RoRo vessels to export American-made products, including BMW SUVs and John Deere tractors.
American Roll-On, Roll-Off Carrier Group, a Florida-based company and participant in the MSP owned by Wallenius Wilhelmsen Group, is among those who could feel the pinch. The company hasn’t released a statement regarding the updated proposal just yet.
Feedback Period Open Until July 7
Industry stakeholders, who didn’t get a chance to voice their opinions on the original LNG and RoRo rules, now have until July 7 to share their feedback on the USTR’s revised plan.
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Source: Reuters
