THE IMPACT OF ADDITIONAL PORT CHARGES ON SHIPPING COSTS

                                                                   THE IMPACT OF ADDITIONAL PORT CHARGES ON SHIPPING COSTS

China on Friday announced it will impose additional port fees on vessels owned or operated by U.S. firms and individuals, or those built in the United States or flying the U.S. flag, starting October 14.  The move is a direct countermeasure to new U.S. port fees that will soon target China-linked ships. According to China's transport ministry, the new charges will apply per voyage and increase steadily over the next three years. U.S. ships calling at Chinese ports will initially be charged ￥400 or $56.13 per net ton, rising to ￥640 or $89.81 in April 2026, ￥880 yuan in April 2027, and ￥1,120 or $157.16 By April 2028.  The U.S., for its part, plans to levy significant port fees on vessels built in China or operated by Chinese entities.

Analysts estimate that these charges could exceed $1million for ships carrying over 10,000 containers, with rates expected to rise annually through 2028. The U.S. trade representative has said the fees are part of a broader strategy to revive domestic shipbuilding and curb China's growing dominance in both commercial and military ship production. China now leads the world in shipbuilding, having produced more than 1,000 commercial vessels last year, compared to fewer than 10 in the United States. While China's countermeasures are symbolic, analysts say the impact will likely be far greater on Chinese shipping firms, given their global fleet size and market share.

The escalating measures come as the current 90-day U.S.-China tariff truce, agreed upon in August, is set to expire around November 9, adding further uncertainty to the already strained economic relationship between the world's two largest economies.

Sinowin team will continue to keep an eye on the shipping costs. We will assist both new and existing customers in formulating their purchasing plans at the appropriate time, and strive to minimize the procurement costs as much as possible.