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The NAM is calling on the U.S. Trade Representative to focus on strengthening America’s domestic shipping and shipbuilding industry as the administration considers new port fees.   

• The NAM’s recommendation came Monday in response to the Trump administration’s plan to impose fees on Chinese container ships that make their way to U.S. controlled ports (CNBC).  

The background: In March 2024, the Biden administration opened an investigation into China’s shipbuilding and shipping practices. In January, the USTR determined that China was involved in unfair trade practices in the maritime and shipbuilding sectors.

• The Trump administration cited these findings in proposing new fees.    

The policy: Under the Trump administration’s proposal, the U.S. would charge carriers between $1 million to $1.5 million every time a Chinese-built vessel entered a U.S. port, according to CNBC.  

• The fee would be calculated based on the size of the company’s Chinese-built fleet, even if no additional ships came to the U.S.
• Fees would also be levied on American and other companies that rely on Chinese ships. 

The problem: While the proposal is meant to encourage shippers to use American shipbuilders over Chinese fleets and shipyards, the U.S. does not have a significant fleet or the capacity to build these ships at scale.   

• Most commercial ships are produced in China, while U.S.-flagged vessels represent only about 0.16% of the world fleet, according to NAM Managing Vice President of Policy Charles Crain.
• “This approach would effectively impose the minimum fee on nearly 100% of cargo vessels making calls on U.S. ports, adding an estimated $600 to $800 for each 20-foot equivalent container unit,” he said. “Shippers likely would pass the entirety of this cost through to their business customers, in many cases further raising the cost of manufacturing in the U.S.” 

Reduced service: Carriers would react to these fees by reducing the number of calls to U.S. ports, Crain added.   

• “In addition to the increased costs, ocean carriers have advised manufacturers that they would limit the ports of call to reduce the fees incurred, resulting in competition for fewer sailing options for manufacturers,” he said. “This would reduce the current competitive cost structure and lower cargo velocity.” 

Snarled supply lines: Crain warned that this move would cause significant backlogs at U.S. ports.  

• “Ocean carriers are also telling manufacturers that they would skip smaller, more conveniently located ports in order to reduce their cost exposure by only stopping at major ports—which could result in port congestion reminiscent of the industry’s experience during the COVID-19 pandemic,” he said.  

The bottom line: “The NAM encourages the administration to focus on revitalizing American shipbuilding—not burdening manufacturers in the U.S. through new port fees that will reduce the availability of the necessary cargo capacity at U.S. ports, increase pressure on domestic infrastructure and raise costs that may render American exports less competitive around the world,” said Crain.