Industry executives have expressed worries over President Donald Trump’s proposal to rejuvenate the U.S. shipping sector, which could result in significant financial burdens on ocean transport operators and create disruptions in the global supply chain. According to a draft executive order obtained by Reuters, the administration seeks to support the revival of American shipbuilding by imposing substantial port fees on vessels built in China and those belonging to fleets with Chinese-made ships.
The proposed levies could impact nearly every ship entering U.S. ports, leading to an estimated annual cost increase of up to $30 billion for American consumers and a potential doubling of shipping expenses for U.S. exports, as reported by the World Shipping Council (WSC). WSC CEO Joe Kramek has urged policymakers to reconsider these detrimental measures and explore alternative strategies that bolster American industries.
While the primary objective of Trump’s plan is to stimulate the U.S. shipbuilding industry and reduce China’s dominance in global shipping, industry leaders caution that the repercussions may contradict the intended goals. Described as a “curve ball” by Jeremy Nixon, CEO of Ocean Network Express (ONE), the plan could have severe consequences for ocean carriers and their clients.
To mitigate the impact of increased fees, ship owners might reduce U.S. port visits, potentially leading to congestion at major ports and hindering the flow of imports and exports. The reallocation of global ship fleets to focus on the U.S. market, as suggested by the plan, could impose additional costs and operational challenges for companies. Executives warn that bypassing smaller ports, like California’s Port of Oakland, could disrupt vital export channels for products such as beef, dairy, and almonds.
The prospect of sudden changes and new regulations has prompted industry players like MSC and CMA CGM to evaluate their strategies, with some considering expanding U.S.-flagged fleets and exploring local shipbuilding options. As uncertainties loom, Maersk refrains from commenting on potential tariffs or fees, acknowledging the rapidly evolving landscape of the industry.
Copenhagen’s representative is Sen, Elke Ahlswede is based in Hamburg, and Renee Maltezou is located in Athens. (Reporting by Chizu Nomiyama; Editing by Sen, Elke Ahlswede, and Renee Maltezou)
