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America and China Started charging additional ports on Tuesday fees On maritime shipping firms that carry everything from leisure toys to crude oil, making the open seas a major front trade war Between the world’s two largest economies.
After China, a return to a full-scale trade war appeared imminent last week announced a major expansion of its rare earth export controls and Presidential donald trump threatened to raise Tariff But Sugar Goods in three figures.
But after the weekend, both sides sought to reassure traders and investors, highlighting the cooperation between their negotiating teams and the possibility that they could find a way forward. China said it had started charging special duties on US-owned, operated, built or flagged ships, but clarified that Chinese-built ships would be exempt from the levy.
In details published by state broadcaster CCTV, China outlined specific provisions on the exemption, which also includes empty ships entering Chinese shipyards for repairs.
Similar to the US plan, the new fees imposed by China will be collected at the first port of entry on a voyage or for the first five voyages within a year.
“This tit-for-tat symmetry locks both economies in a cycle of maritime taxation that threatens to distort global freight flows,” Athens-based Exclusive Shipbrokers said in a research note.
Earlier this year, the Trump administration announced plans to impose tariffs on ships tied to China in a bid to loosen the country’s grip on the global maritime industry and bolster American shipbuilding.
An investigation during the former Biden administration concluded that China used unfair policies and practices to dominate the global maritime, logistics and shipbuilding sectors, clearing the way for those penalties.
China hit back last week, saying it would impose its own port charges on US-bound vessels from the day the US tariffs go into effect. “We are in a busy phase of disruption, where everyone is quietly trying to improve operations with varying degrees of success,” said independent dry bulk shipping analyst Ed Finlay-Richardson.
He said he has heard reports that US shipowners with non-Chinese ships are trying to sell their cargo to other countries en route so that the ships can divert their route. Reuters was not immediately able to confirm.
Analysts expect China-owned container carrier COSCO to be hardest hit by U.S. fees, with those fees accounting for about half of that segment’s expected $3.2 billion cost in 2026.
Major container lines including Maersk, Hapag-Lloyd and CMA CGM reduced their exposure by moving China-bound vessels out of their US shipping lanes. Following strong opposition from the agricultural, energy and US shipping industries, trade officials there reduced the tariffs from initially proposed levels and exempted a broad group of ships.
USTR did not immediately respond to a request for comment.
China’s commerce ministry said on Tuesday, “If the US chooses confrontation, China will see it through to the end; if it chooses negotiation, China’s door will remain open.”
In a related move, Beijing also imposed sanctions on Tuesday against five US-linked subsidiaries of South Korean shipbuilder Hanwha Ocean, which it said had “aided and abetted” a US investigation into Chinese trade practices.
Hanwha, one of the world’s largest shipbuilders, owns the Philly Shipyard in the US and has won contracts for the repair and overhaul of US Navy ships. Its entities will also build US-flagged LNG carriers.
Hanwha said it is aware of the announcement and is closely monitoring the potential business impact, and that it will continue to provide services to its customers, “including through our investments in the US maritime industry and the Hanwha Philly Shipyard.”
Hanwha Ocean shares sank nearly 6%. China also began investigating how the US investigation affected its shipping and shipbuilding industries.
Shipping Lines Scrabble for Workarounds
A Shanghai-based business consultant said the new fees would not cause much disruption.
“What are we going to do? Stop shipping? Trade with the US is already disrupted enough, but companies are looking for a way,” said the consultant, who requested anonymity because he was not authorized to speak to the media.
The US last Friday announced a separate arrangement for long-term charterers of China-operated vessels carrying US ethane and LPG, suspending port charges for them until December 10.
Meanwhile, ship-tracking company Vortexa identified 45 LPG-carrying VLGCs – representing 11% of the total fleet – that would be subject to China’s port charges.
China’s new port fees could affect oil tankers accounting for 15% of global capacity, Clarkson Research said in a report. Jefferies analyst Omar Nocta estimates that 13% of crude tankers and 11% of container ships in the global fleet will be affected.
The trade war extends to environmental policy
In retaliation against China curbing exports of critical minerals, Trump on Friday threatened to impose additional 100% tariffs on goods from China and impose new export controls on “any and all critical software” by November 1.
Administration officials warned hours later that countries that voted this week in favor of a U.N. International Maritime Organization plan to reduce planet-warming greenhouse gas emissions from maritime shipping could face sanctions, port restrictions or punitive vessel fees. China has publicly supported the IMO plan.
Exclusive said, “The weaponization of both trade and environmental policy signals that shipping has transformed from a neutral medium of global commerce to a direct instrument of statecraft.”
Shares of Shanghai-listed COSCO rose more than 2% in early trading on Tuesday. The company said its board had approved a plan to buy back shares worth 1.5 billion yuan ($210.3 million) within the next three months to preserve corporate value and protect shareholder interests.
The shipping firm did not immediately respond to Reuters questions about port charges.