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Scaled back USTR port tariff to hit Chinese carriers hardest

The US Trade Representative (USTR) has narrowed the scope of its tariffs against China’s maritime industry to a fee based on the cargo capacity or container volume of Chinese-operated and -built ships entering US ports. The more targeted actions follow industry warnings that earlier proposals would increase costs for US shippers and pose an existential threat to smaller ports, but China-based ocean carriers could still face millions in fees under the tariffs.

In its list of tariff actions that take effect Oct. 14, the USTR said Chinese ocean carriers will be subject to a fee of $50 per net ton of capacity upon arrival at a US port. The fee will go up to $80 after one year, rising each year before topping out at $140 in 2028.

Net tonnage measures a ship’s overall cargo capacity, regardless of vessel type. The fee will only be charged at the first port of call on a vessel string and will not stack on top of other port calls. The fee will only be charged five times per year on each vessel.

Ocean carriers based outside of China operating Chinese-built ships will face a fee based on either net tonnage or container volume, whichever is higher. Ships built in other countries will not face the same fees, nor will fees be assessed based on the percentage of Chinese-built ships in a carrier’s fleet or orders at Chinese shipyards.

The tonnage fee for non-Chinese carriers starts at $18, escalating to $23 by April 2026 and topping out at $33 in 2028. The per-container fee starts at $120 and rises to $153 next year and $250 in 2028.

Non-Chinese ocean carriers will be able to waive the fee if they take delivery of a US-built ship of at least the same size within three years. The fees will not apply to Chinese-built ships in US-flag fleets, container ships that are 4,000 TEUs or smaller, voyages of less than 2,000 nautical miles or Chinese-built ships owned by US-based carriers.

The capacity-based tariffs come after a series of proposals that included fees of up to $1.5 million based on US port calls by Chinese carriers and similar fees on non-Chinese ocean carriers with Chinese-built ships in their fleets and orders at Chinese shipyards. Other proposals included an export cargo preference for US-built ships.

After two days of hearings, the USTR said it wanted to reduce the potential impact on US shippers, particularly exporters and dry-bulk shippers.

Still, the USTR plans tariffs based on the capacity of China-built ships and will still charge fees on that country’s ocean carriers. The goal of the fees is “to further disincentivize use of Chinese shipping services,” the USTR said.

Cosco, OOCL in crosshairs

The USTR’s fees will have the largest impact on ships operated by Cosco Shipping and its subsidiary Orient Overseas Container Line (OOCL).

Source: JOC

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Vancouver still dealing with extended rail container dwell times

Challenged by severe winter weather in the Canadian interior and a backlog of containers from longshore labor disruption in late 2024, marine terminal operators at the Port of Vancouver continue to grapple with a problem that seems ever-present: extended dwell times for containers moving inland by rail.

Railroads normally run fewer, shorter trains during Canadian winters, but this season’s weather restrictions were more severe than usual, which has caused eastbound containers to pile up on the docks over the past three months.

“Inclement weather across much of Canada in February, including a deep freeze in the prairies and a severe snowstorm in Ontario, affected rail turnaround times and reduced railcar availability on the West Coast,” a spokesperson for the Port of Vancouver told the Journal of Commerce.

“Shorter trains mean more people and equipment are required to move the same amount of goods,” a spokesperson for Canadian National Railway (CN) said.

The average rail container dwell time in March at Vancouver’s four container terminals was 7.7 days. While that was marginally down from 8.5 days in February and 8.3 days in January, according to port statistics, it’s well above the four to five days terminal operators on North America’s West Coast say they can live with in order to keep rail dwells at their facilities manageable.

Infor Nexus pegged March rail dwells at seven days, down from nearly 10 days in February.

Vancouver’s dwell times have been above five days since last November.

Importers in Canada and the US say rail congestion at Vancouver is a given during the peak shipping season in August through October, when the port and inland rail networks must handle greater volumes than they are designed to handle. But Vancouver has struggled with extended rail dwells over the past several months, well beyond the end of the traditional peak season.

A forwarder said it has taken him as long as 30 days to retrieve some of his containers from Vancouver, saying whether it’s a weather event or labor action or a peak season surge in imports, excessive rail container dwell times are a condition he’s come to expect at the port, calling it “business as usual.”

Stakeholders, however, say they see signs of improvement.

A spokesperson for Canadian Pacific Kansas City Southern (CPKC) said its rail container dwell times are improving at the Vanterm and Centerm terminals in Vancouver. According to the port’s website, CPKC’s rail container dwell at Vanterm on Monday was three to five days, with the average Centerm dwell at zero to three days. Still, CPKC’s dwells were seven days or longer at the Deltaport terminal.

“Driven by dwell improvements at Centerm and Vanterm terminals, we are seeing elevated volumes that we are now moving with improved network and overall supply chain performance following weeks of sustained extreme winter temperatures that impacted operations across the Canadian supply chain,” the CPKC spokesman said.

CN is targeting later this spring for a return to normal at its operations.

“Assuming no further weather impacts, CN anticipates the trend line for container dwell to continue downward through the early spring, getting back to more normal dwell times by mid-late spring,” the CN spokesperson said.

The Vancouver spokesperson said as April progresses, rail business is returning to seasonal norms, “with on-dock volumes and dwell times both trending positively.”

Source: JOC

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Trump announces 10% across-the-board tariffs on all US imports

President Donald Trump on Wednesday said the US will assess a minimum 10% tariff on all imports into the US, although countries the Trump administration views as having an unfair trade imbalance with the US will be hit with much higher levies.

The so-called “reciprocal” tariffs that Trump unveiled Wednesday will be equivalent to half of what the US calculates each individual country imposes, through tariffs and non-tariff barriers, on US exports.

The tariffs vary by country and will go into effect in two stages between April 5 and April 9. Products from countries hit with the baseline 10% tariff will be impacted from April 5, while products from individual countries with specific reciprocal tariffs will be affected from April 9.

Imports from China, for example, will be set at 34%, the European Union at 20% and Vietnam at 46%.

Other tariff levels announced Wednesday are 26% on goods from India, 25% on South Korea and 36% on Thailand. Most South American nations will see a 10% tariff on their exports to the US.

Canada and Mexico have already been hit with 25% tariffs that went into effect Wednesday.

Details please refer to the JOC news.

Source: JOC

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April blank sailings ramp up amid push to finalize long-term contracts

Ocean carriers plan to blank more sailings through much of April as freight rates hit new lows for 2025 and more ships are expected to hit the water in the coming months. The withdrawal of capacity also comes as ocean carriers look to finalize annual service contracts with shippers.

A total of 68 sailings globally are expected to be canceled during April, according to maritime consultancy Drewry, with about half of the cancellations in trans-Pacific services. The blankings are occurring across a variety of weekly services to major US ports.

Mediterranean Shipping Co. last week said it would blank six voyages between Asia and the US, with most of the cancellations for sailings originally scheduled for the second half of April. MSC said it would cancel late-April voyages scheduled to the US West Coast on both its Orient service from northern China and its Pearl service from Vietnam and southern China.

MSC will also cancel a weekly sailing on its Empire and America services to the US East Coast and another sailing on its Lone Star Express service to the US Gulf Coast.

Schedules from other carriers also show more capacity being withdrawn in the coming weeks. Ocean Network Express’ (ONE’s) export schedule for Shanghai shows the Premier Alliance will have no vessels for mid-April sailings on both its EC1 service to the US East Coast and the EC2 service calling the Port of Manzanillo in Mexico and the US Southeast.

ONE also canceled a mid-April sailing on its MS2 service between Asia and the US West Coast and a sailing originally scheduled this week on its PN3 service to the ports of Vancouver and Tacoma.

Ocean Alliance member Cosco Shipping also appears to be removing trans-Pacific capacity in the short term. It has no weekly voyage scheduled in the second week of April for its Manhattan Bridge service to the US East Coast. The carrier’s Bohai and Hibiscus Express services to the US West Coast also do not have vessels scheduled for the same week.

Details please refer to the JOC news.

Source: JOC

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Key Mexican container ports facing delays amid calls by larger vessels

The Mexican Pacific ports of Lazaro Cardenas and Manzanillo are experiencing delays of up to five days as they face operational challenges caused by bigger ships calling the gateways.

“A couple of years ago, the biggest ship arriving in Mexico was about 10,000 TEUs,” said Nicolas Portenza, president of Eternity International Freight Forwarder México. “Now you have Maersk, MSC [Mediterranean Shipping Company] and CMA CGM arriving with vessels between 12,000 TEUs and 16,000 TEUs to a port that is the same size.”

 

“I think it will recover during April and May,” Portenza told the Journal of Commerce. “Demand is not weak per se, it’s just not keeping up with the [vessel] supply.”

Still, industry sources are paying attention to talk of even more capacity to come serving Central America and the West Coast of South America (WCSA).

“There is news of new services to Mexico and also to WCSA,” said a forwarder source with cargo on the lane. “It will be a bloodbath if they come.”

Decreasing blank sailings

Meanwhile, the Asia to West Coast South America and Central America lane is positioned for fewer blanks in April as forwarders report green shoots of demand, although it may not be enough to offset the increased vessel sizes and excess capacity.

eeSea as of Monday reports that no blanks are forecast on the lane in April, down from 12 blank sailings in March that accounted for about 12.2% of the total capacity for WCSA imports from Asia. March marked the highest number of blank sailings observed on the trade since September, a likely response to several capacity injections on the lane in the past several months.

According to Eternity International, the Asia to Mexico lane had a total of five blank sailings spread among four carriers in March, although that is expected to drop to three blanks in April, all from Cosco.

Source: JOC