The United States and China have escalated their trade conflict in the maritime sector, imposing reciprocal port charges on ships operating between the two countries. The move represents a significant escalation of the trade war, with global shipping companies now caught in the crossfire of economic and geopolitical competition.
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Starting Tuesday, both countries began collecting additional port fees from ocean carriers carrying goods ranging from consumer products to crude oil. The simultaneous release of these costs effectively turns global shipping lines into the latest battleground in the economic stalemate between the world’s two largest economies.
Tensions rose last week after China announced a sweeping expansion of export controls on rare earth elements – a key component in advanced electronic and defense systems – and US President Donald Trump threatened to impose triple-digit tariffs on Chinese imports. However, both sides appeared to have softened their rhetoric over the weekend, indicating continued engagement between negotiators.
Beijing’s new rules apply to all US-owned, operated, built, or flagged ships, but exempt Chinese-built ships and empty ships entering domestic shipyards for repairs, according to China’s state television CCTV. As in US action, fees are charged either at the first port of entry on a single voyage or on the first five voyages in a year.
“This two-way symmetry locks both economies in a maritime tax spiral that risks disrupting the global flow of goods,” said a research note from Athens-based Xclusiv Shipbrokers.
The Trump administration first introduced its port fee plan earlier this year as part of a broader effort to weaken China’s dominance of global shipbuilding and boost U.S. marine manufacturing. The policy followed a Biden-era investigation that accused China of using unfair practices to control global shipping and logistics markets.
China responded in kind, announcing similar port charges for US-bound vessels from the same day. China’s Ministry of Commerce said in a statement: “If America chooses confrontation, China will see it through to the end; If it chooses dialogue, China’s doors will remain open.
Industry analysts warn that the escalation of measures could severely disrupt global trade routes. “We’re in the turbulent phase of the disruption, where everyone is quietly trying to improvise solutions,” said Ed Finley Richardson, a dry bulk shipping analyst, who cited reports of U.S. shippers diverting cargo mid-voyage to avoid paying the new fees.
Container giant COSCO is expected to bear the brunt of the financial burden, with analysts estimating it could absorb almost half of the $3.2 billion in costs in 2026. Major lines such as Maersk, Hapag-Lloyd, and CMA CGM have adjusted their networks to limit exposure to ships on China-bound routes.
The US Trade Representative (USTR) declined to comment on the development.
Beijing also sanctioned five US-linked subsidiaries of South Korean shipbuilder Hanwha Ocean, accusing them of aiding a US investigation into China’s maritime practices. Hanwha, which operates a Philly shipyard that builds ships for the US Navy, said it was monitoring the situation closely. Hanwha Ocean shares fell nearly 6 percent after the announcement.
Shipping analysts say the full impact of port costs could spread across different market segments. Vortexa identified 45 liquefied petroleum gas (LPG) carriers – roughly 11% of the global VLGC fleet – subject to the new Chinese charges, while Clarksons Research reported that oil tankers representing 15% of global capacity could be affected. Jefferies estimates that 13 percent of crude oil tankers and 11 percent of container ships could face higher costs.
The U.S. has announced limited exemptions for long-term charterers of ethane and LPG, delaying port charges until December 10.
Meanwhile, trade confrontations are beginning to merge with climate policy disputes. In response to China’s rare earth restrictions, Trump threatened new 100 percent tariffs on Chinese goods and proposed export controls on critical software until Nov. 1. US officials also warned that countries that support the International Maritime Organization’s plan to reduce greenhouse gas emissions could face sanctions or port restrictions.
“The weaponization of trade and environmental policies shows that shipping has changed from a neutral conduit of global trade to a direct tool of state-building,” Xclusiv said.
Despite the turmoil, shares of China’s COSCO rose more than 2 percent on Tuesday after it announced plans to buy back 1.5 billion yuan ($210 million) in shares to shore up investor confidence.
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