U.S. and China Suspend Port Fees Central to Trump’s Shipbuilding Strategy
Mike Schuler October 30, 2025
The United States and China have agreed to suspend retaliatory port fees on each other’s vessels for one year, marking a major pause in a central pillar of the Trump administration’s push to counter China’s shipbuilding dominance.
The suspension comes as part of a broader trade truce between the world’s two largest economies. U.S. President Donald Trump announced Thursday that he had reached an agreement with President Xi Jinping to reduce tariffs on China in exchange for Beijing’s commitment to crack down on illicit fentanyl trade, resume purchases of U.S. soybeans, and maintain rare earths exports. The face-to-face talks in Busan, South Korea—the first between the two leaders since 2019—concluded Trump’s Asia tour, during which he also announced trade agreements with South Korea, Japan, and Southeast Asian nations.
Washington began charging special fees on China-linked vessels calling at American ports on October 14, as part of a wider investigation by the Office of the U.S. Trade Representative into China’s maritime and shipbuilding dominance. The U.S. has now agreed to pause measures resulting from that investigation for one year, according to China’s Ministry of Commerce.
“Following the US suspension, China will also suspend its countermeasures against the US for one year,” the ministry stated, referring to Beijing’s retaliatory fees against American ships that took effect the same day as the U.S. measures.
The announcement came just hours after U.S. Trade Representative Jamieson Greer emphasized that the administration’s focus remains on reviving American shipbuilding. “We’re trying to rebuild shipbuilding,” he said aboard Air Force One when asked whether Trump and Xi had agreed on port fees during their South Korea meeting.
The suspension offers temporary relief to shipping company caught in the crossfire of escalating maritime trade tensions. The tit-for-tat fees have upended global shipping networks—driving up freight costs, forcing fleet reshuffles, and even prompting boardroom shakeups. The charges are part of a broader maritime contest as the United States seeks to challenge China’s dominance in shipbuilding.
Industry groups welcomed the suspension. The International Chamber of Shipping said it looks forward to receiving confirmation and further details on the reports, which have not yet been confirmed by USTR officials. “The reports of the U.S.’ agreement to suspend the Section 301 port fees on China’s maritime, logistics and shipbuilding industries by one year, and the agreed reciprocal suspension of China’s countermeasures targeting US linked ships, is a welcome and positive development,” the organization stated.
The ICS noted that while it supports the ambition to increase U.S. shipbuilding capacity, “the port fees imposed by the USTR, and subsequently by China as countermeasures to U.S. linked ships, has already posed significant challenges and disruptions for the shipping industry and global trade.”
World Shipping Council President and CEO Joe Kramek commented: “Global trade flows best when it flows freely, and a suspension of ship fees by the United States and China is a win for farmers, exporters, and consumers. Avoiding additional costs helps keep trade competitive and maintains access to critical shipping lanes.”
However, the suspension has raised questions among labor unions about the future direction of U.S. maritime policy. USW Legislative Director Roy Houseman said: “The ‘truce’ that has paused the 301 port fees on vessels built in the People’s Republic of China leaves a lot of unanswered questions on how the U.S. will address the need to reinvigorate its domestic commercial shipbuilding base. 53% of all global ship orders by tonnage during the first eight months of 2025 are currently going to just one country, the People’s Republic of China.”
The USTR port fees represent the trade-policy pillar of the Trump administration’s broader effort to rebuild American shipbuilding and maritime power. The fees emerged directly from the Section 301 investigation into China’s anti-competitive shipbuilding practices—a probe originally initiated by U.S. labor unions—and were designed to penalize reliance on Chinese-built vessels while incentivizing investment in U.S. yards.
“Ships and shipping are vital to American economic security and the free flow of commerce,” said Ambassador Greer, a Trump appointee, in April. “The Trump administration’s actions will begin to reverse Chinese dominance, address threats to the U.S. supply chain, and send a demand signal for U.S.-built ships.”
The fees complement the administration’s “Restoring America’s Maritime Dominance” executive order and the proposed SHIPS for America Act in Congress. Together, they form a three-part strategy — executive action, trade enforcement through USTR port fees, and legislative investment via the SHIPS for America Act — representing the most significant U.S. maritime reform effort since 1970.
The journey to the port fees began in March 2024, when a coalition led by the United Steelworkers petitioned the USTR to investigate China’s shipbuilding campaign. In January 2025, the USTR concluded that China’s state support for shipbuilding, marine equipment, and shipping services constituted unfair trade practices and were “unreasonable” under Section 301. The executive order followed in April 2025, with the SHIPS for America Act introduced the same month.
The final Section 301 action was announced on April 17, imposing port fees on China-linked ships along with a slew of related maritime and industrial measures such as new tariffs on Chinese-made ship-to-shore cranes and cargo-handling equipment, adjusted fees for foreign-built vehicle carriers, the removal of LNG license restrictions tied to U.S.-built tonnage, and carve-outs for certain ethane and LPG carriers.
Many questions remain unanswered, according to Brian Maloney, a partner in Seward & Kissel’s Maritime & Transportation Group, as the USTR has yet to provide details.
“Will this apply to other foreign vehicle carriers in Annex III or will the pause apply only to the Annex I and II fees for Chinese-owned, -operated or -built vessels? When will the pause and the responsive Chinese pause kick in, which could matter for vessels actively trading? And will either country extend retroactive relief to October 14?”
The one-year suspension leaves open questions about the long-term trajectory of the administration’s maritime and shipbuilding strategy—whether it marks a genuine recalibration or merely delays the implementation of policies designed to reshape global shipping in favor of American yards. For now, however, the pause has eased tensions across the global shipping industry.
https://gcaptain.com/u-s-and-china-suspend-port-fees-central-to-trumps-shipbuilding-strategy/