Prominent maritime industry stakeholders are virtually flooding the office of the U.S. Trade Representative (USTR) with comments opposing the proposed measures targeting Chinese-built and operated vessels, warning of potentially disastrous effects on U.S. trade and consumer prices.
The measures seek to counter China’s dominance in maritime sectors by imposing port fees of up to $1.5 million on Chinese-built ships and operators, while promoting U.S. vessel usage and the U.S. shipbuilding industry. A public comment period ends on March 24 when a public hearing is scheduled at the International Trade Commission.
The International Chamber of Shipping (ICS), which represents over 80% of the global merchant fleet, states that the proposed fees could severely disrupt U.S. trade and increase consumer prices. The fees could potentially affect 98% of container ships calling at U.S. ports.
“The proposed remedies could have an overall net negative impact on the U.S. economy, and result in a decline in U.S. exports,” asserts ICS in its written submission to the USTR.
Leading ro-ro carrier Atlantic Container Line (ACL) projects dramatic cost increases. Export container rates could soar from $500 to $2,500, while import rates could climb from $2,500 to $4,500. ACL warns it would be forced to “terminate its US service, close its American offices, lay off its American staff and redeploy its ships to non-US trades.”
The Chamber of Shipping of America (CSA) cites data showing U.S.-built ships cost four times more than foreign-built vessels, with delivery times exceeding 10 years for specialized vessels.
“Due to decades of neglect, the US maritime industry has seen a steady decline…we necessarily must rely on vessels registered in other nations,” CSA states. It stresses hat imposing port fees alone won’t revitalize U.S. shipbuilding or the U.S.-flagged fleet. Instead, proactive legislation like the SHIPS for America Act is required.
Among other submissions, the East Coast Stevedore Company warns that implementing the fees as written would “destroy trade across the entire United States.” This sentiment is echoed across the industry, with particular concerns about impacts on agricultural exports, energy trade, and regional shipping services.
The Louisiana Maritime Association (LaMA) warned that American maritime workers could lose out in the near term, even if the fees eventually succeed in boosting future U.S. shipyard activity. “The fallout will affect railroads, pilots, towage (tug) companies, barge companies and many small, independent businesses such as line handling companies, dock, terminal and facility workers. The myriad of United States companies dependent on the shipping industry could (and reportedly already are) lose business based on the anticipation of the implementation of this USTR action.”
(Photo of the Port of Long Beach)