U.S. supply chain faces another tariff headwind ahead of new port fees

With less than 24 hours ahead of new U.S. governmentport fees on Chinese-made freight vessels, importers are grappling with additional tariffs that include other Chinese-made machinery key to the supply chain.

On Friday, the U.S. Trade Representative announced modifications following a review of public comments on the prior rule, which include an additional 150% tariffs on rubber tire gantry cranes, rail-mounted gantry cranes, automatic stacking cranes, reachstackers, straddle carriers, terminal tractors, top loaders, and the components that make up the pieces of equipment.

Factoring in the layering of prior tariffs on the cranes, the new tariff rate can be as high as 270%.

In addition to the port crane fees, additional changes include the fee structure changes for vehicle carriers, otherwise known as roll-on roll-off vessels, which help to carry automobiles, farm equipment and other heavy machinery.

Now, a fee will be charged based on the vessel’s net tonnage capacity instead of the number of vehicles being carried. One ocean carrier that owns and operates RoRos said the change could cost them millions.

That will be on top of the new USTR port fees, set to go into effect on Tuesday. The USTR, under the Biden administration, investigated China’s maritime practices in both shipbuilding and crane manufacturing; the Trump Administration pursued the trade actions. According to trade experts, payments on these new tariffs can be deferred until December 10 but the fees will begin applying on October 14.

Lars Jensen, founder of Vespucci Maritime, told CNBC the fees on cranes and port equipment are merely another element added to the costs of the U.S. supply chain.

“Effectively, the tariffs are another headwind and making imports more expensive and exports less competitive,” said Jensen. “In recent months, we have seen how containerized volumes to and from the U.S. are declining while volume in the rest of the world is increasing strongly. Every new headwind will serve to solidify that development.”

Thomas Kazakos, secretary generalof the International Chamber of Shipping, which represents the world’s national shipowner associations and over 80% of the world’s merchant fleet, told CNBC they are still reviewing the modifications.

“ICS supports the ambition to increase U.S. shipbuilding capacity and to make the United States Shipbuilding industry strong, as additional commercial tonnage strengthens the global maritime sector’s efficiency and competitiveness, said Kazakos. “However, the service or port fees proposed by the USTR will have a huge impact on US exports. It could damage US export competitiveness and raise costs for US businesses and consumers, as the proposed port fees are essentially a protectionist measure.”

In a global maritime study conducted by ICS and Professor Craig VanGrasstek from the Harvard Kennedy School of Government, researched suggested that a lower level of trade restrictive measures affecting maritime transport could increase some economies’ GDP by up to 3.4%.      

“Removing tariff and non-tariff barriers are quick and easy tools available to policymakers to increase levels of GDP,” Kazakos said. “Countries at all levels of economic development would be better off if even modest reductions were made to the existing barriers.   As we are seeing, these measures also often inspire retaliatory measures. Ultimately, no one will win if these tactics are pursued.”

China recently announced counter tariff measures. U.S. Treasury Secretary Scott Bessent said there have been “substantial communications” with China over past weekend on trade, adding that President Trump is still expected to meet Chinese President Xi Jinping in South Korea later in the month.

For the U.S. energy market, the modifications are good news; USTR eliminated a clause for suspension of licensing of LNG shipments. The provision in the April announcement mandated that increasing proportions of US LNG exports must be moved on U.S.-built vessels.

Other vessels in the U.S. Maritime Security Program that transport military use vehicles and built in non-U.S. yards will continue to benefit from a “targeted exemption” through 2029.