The United States will levy port fees on Chinese shipping firms and ships, which will have limited impact on Taiwanese shipping firms.

Taiwan • Business • 04/26 06:00
The United States will levy port fees on Chinese shipping firms and ships, which will have limited impact on Taiwanese shipping firms.

The United States Trade Representative (USTR) announced on April 17, 2025, that it will impose staggered port fees on Chinese shipping companies and vessels made in China as a response to China's unfair practices in the shipping, logistics, and shipbuilding sectors. The new policy will be implemented starting October 14, 2025, with a 180-day grace period. Industry experts believe that Taiwanese shipping companies will be minimally affected because of the low percentage of vessels made in China, keeping a neutral stance on shipping stocks.

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04/26 06:00

The United States will levy port fees on Chinese shipping firms and ships, which will have limited impact on Taiwanese shipping firms.

The United States Trade Representative (USTR) announced on April 17, 2025, that it will impose staggered port fees on Chinese shipping companies and vessels made in China as a response to China's unfair practices in the shipping, logistics, and shipbuilding sectors. The new policy will be implemented starting October 14, 2025, with a 180-day grace period. Industry experts believe that Taiwanese shipping companies will be minimally affected because of the low percentage of vessels made in China, keeping a neutral stance on shipping stocks.

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Details of the U.S. Staggered Port Fee Policy

According to the USTR announcement, the U.S. will impose staggered port fees on Chinese shipping companies and Chinese-built vessels. The specific measures are as follows:

  • For Chinese shipping companies and Chinese shipowners: Fees will be charged based on the ship's net tonnage (NT), with a 180-day grace period. Starting October 14, 2025, a fee of $50 per net ton will be charged; on April 17, 2026, it will increase to $80; on April 17, 2027, it will be $110; and on April 17, 2028, it will finally increase to $140. Each ship will be charged a maximum of five times per year.

  • For non-Chinese shipping companies using Chinese-built vessels: A 180-day grace period is also provided, with fees calculated based on net tonnage or per container, whichever results in a higher fee. Starting October 14, 2025, a fee of $18 per net ton or $120 per container will be charged; on April 17, 2026, it will increase to $23 per net ton or $150 per container; on April 17, 2027, it will be $28 per net ton or $200 per container; and on April 17, 2028, it will finally increase to $33 per net ton or $250 per container.

Additionally, the fees will only be imposed on large vessels (capacity over 4,000 TEU) and will be charged only once at the first U.S. port of call to avoid duplicate charges.

Policy Background and Adjustment Process

This fee measure stems from the U.S. 301 investigation into China's shipping, logistics, and shipbuilding industries. The investigation concluded that China has caused harm to related U.S. industries through subsidies and other unfair means. The initial proposal planned to charge up to $1.5 million per port call for ships built or operated by China, but due to opposition from U.S. agriculture, exporters, port authorities, and others, it was adjusted to the current staggered, tonnage or container-based fee model with an annual charge limit to reduce the impact on the shipping industry.

Latest Views of Institutional Investors on Shipping Stocks

Institutional investors point out that the initial fee of $50 per net ton for Chinese shipping companies accounts for about 15% to 25% of the current freight rates on the East and West Coast routes of the U.S. Considering that U.S.-China tariff policies have already significantly reduced the volume of Chinese exports to the U.S., it is expected that Chinese shipping companies will gradually redirect their capacity to other international routes, further affecting capacity allocation on U.S. routes.

For Taiwanese shipping companies, institutional analysis suggests limited impact. For example, among Taiwan's three major container shipping companies:

  • Evergreen Marine: The proportion of Chinese-built vessels operating on U.S. routes is about 3%, and the proportion of new ship orders built in China over the next three years remains below 20%, with Chinese-built vessels mainly deployed on European and Asian short-sea routes.
  • Yang Ming Marine Transport: The proportion of Chinese-built vessels is about 17%, but there is room for adjustment, and the fleet can be adjusted to mitigate the impact.
  • Wan Hai Lines: There are no Chinese-built vessels on U.S. routes, so it is completely unaffected by this policy.

Therefore, institutional investors generally maintain a neutral rating on Taiwanese shipping companies, believing that high cash dividend policies and flexible fleet deployment capabilities will help withstand short-term fluctuations brought by the policy.

Potential Benefits and Risks for Taiwanese Shipping Companies

If the market responds to the new port fees by raising freight rates, Taiwanese shipping companies may benefit indirectly. However, analysts also warn that as Chinese shipping companies shift capacity to other ocean routes, it may exert downward pressure on freight rates on Asian and European routes, offsetting some of the cost advantages on U.S. routes.

Currently, still within the 180-day exemption period, institutions believe that the first phase of fee collection will have a limited impact on shippers' cost increases, so it is unlikely to trigger a rush to ship in the short term. However, if the exemption period ends and rates increase further, it may put pressure on demand in the second half of the year, further affecting the shipping market outlook.

References

People Also Ask...

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Is the impact of this new U.S. policy on Taiwanese shipping companies truly that minimal? Could it be that potential risks are being underestimated?

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The United States is imposing port fees on Chinese shipping companies, which has limited impact on Taiwanese shipping companies. How might this affect our local shipping industry?

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The US is imposing port fees on Chinese shipping companies, which has limited impact on Taiwanese shipping companies. How does this affect investments in shipping stocks?