China’s flag carrier, Cosco, and its subsidiary Orient Overseas Container Line (OOCL) of Hong Kong, stated they will not impose surcharges to offset new U.S. port fees on Chinese-built and operated ships, set to be implemented on October 14. This decision contrasts with other liner operators who are adjusting their services in response to the fees.

Read also: US Ports Anticipate Strong Finish to Year with Promising 2025 Outlook

Cosco informed its U.S. customers that it plans no changes to its services ahead of the punitive fees, which were formulated under the authority of the United States Trade Representative. “It seems unlikely shippers will experience much of an impact once the new law takes effect,” said Judah Levine of analyst Freightos, in a note to clients.

The fees, which aim to blunt China’s maritime dominance and boost American shipping and shipbuilding, could cost Cosco and OOCL as much as $2.1 billion in 2026, according to analysts, but could be absorbed by subsidies from Beijing.

The specific fee structure charges China-owned or operated ships $80 per net tonnage for each voyage to the U.S. Non-Chinese operators will be charged the greater of $23 per net ton or $154 per twenty-foot equivalent unit (TEU) capacity. These fees apply up to five times annually per vessel, while roll-on/roll-off (ro-ro) vehicle carriers will pay a rate of $14 per net ton. The fees are scheduled to increase by $5 per ton annually until April 2028. Payment must be made in advance of arrival via the Treasury Department’s Pay.gov platform, and vessels without proof of payment risk denial of entry or cargo operations at U.S. ports.

In a related development, Beijing passed new maritime laws in late September that allow it to levy retaliatory port fees and bar port access and data for vessels from countries that discriminate against China. “American lines such as Matson, and U.S.-flagged vessels make up a modest share of trans-Pacific volumes,” said Levine, “so this kind of response may not have an outsized impact, but does represent an escalation as the deadline approaches.”

Separately, trans-Pacific spot container rates continued to fall following the Chinese Golden Week holiday. The Freightos Baltic Index reported Asia-U.S. West Coast rates dropped 16% to $1,554 per forty-foot equivalent unit (FEU), a level Levine termed “a possibly loss-making.” Prices to the East Coast fell 18% to $3,260 per FEU. On other trade lanes, Asia-Europe rates settled at $2,000 per FEU, down 9%, and Asia-Mediterranean prices fell 6% to $2,217 per FEU. According to Levine, “all these lanes [are] at least 60% lower than this time last year and at or near their lowest levels since just before the start of the Red Sea crisis almost two years ago.”

Source: IndexBox Market Intelligence Platform