Potential Impacts U.S. Ag Could See From New Proposed Fees on Chinese Ships

The Trump administration has proposed a series of fees targeting ocean carriers with ties to China. These fees are part of broader efforts to counter China’s growing dominance in global shipbuilding and logistics, while attempting to stimulate U.S. shipbuilding capacity.

The proposal includes:

• Fees up to $1 million per entrance on Chinese-operated vessels.
• Fees up to $1.5 million on Chinese-built vessels, scaled based on the percentage of an operator’s fleet built in China.
• Additional fees on operators with future orders placed with Chinese shipyards.
• A gradual requirement to shift a growing percentage of U.S. exports onto U.S.-flagged and U.S.-built vessels.

The U.S. Trade Representative’s (USTR) office argues these measures are necessary to counteract China’s unreasonable targeting of the maritime, logistics, and shipbuilding sectors for dominance. The concern is that China’s monopolization reduces competition, displaces foreign firms and increases dependencies on Chinese supply chains. The fee proposals are currently open for public comment until March 24, with a public hearing scheduled on the same day. Following the hearing and review of public feedback, USTR will decide on how to implement the proposed measures.

Potential Impacts on U.S. Agriculture

While addressing China’s maritime dominance is a valid national security concern, these proposals may unintentionally – and disproportionally – penalize U.S. farmers and ranchers who rely on affordable and efficient shipping. More than 21% of all vessels calling at U.S. ports in 2024 were Chinese-built, meaning a substantial share of vessels transporting U.S. goods — including agricultural products — could be subject to these fees.

Bulk agricultural exports, particularly grains and oilseeds, are especially vulnerable. In 2024, the U.S. exported more than 106 million metric tons of bulk agricultural products. Assuming an average vessel capacity of 60,000 metric tons, approximately 1,770 vessel movements per year support these exports. Applying the 21% figure for Chinese-built vessels translates to about 372 vessel trips per year facing the proposed fees.

Many dry bulk vessels arriving at U.S. ports from China often come partially loaded or even empty, since China’s primary exports to the U.S. are manufactured goods typically shipped in container vessels. Once in the U.S., these bulk carriers are essential to agriculture, frequently loaded with grains, oilseeds, and other commodities for export.

Container ships, by contrast, typically arrive in the U.S. full and return to China empty or lightly loaded. This is why container shipping rates are much higher from Asia to the U.S. than in the reverse direction — importers bear most of those costs on the inbound leg.

For bulk carriers, the opposite is true: They may arrive empty but leave full with U.S. agricultural products. That means U.S. exporters, particularly farmers, are more exposed to any added vessel fees, since they rely on filling those ships for outbound sales. In effect, while container shipping fees weigh more heavily on U.S. importers, dry bulk shipping fees fall squarely on U.S. exporters — leaving farmers to absorb the brunt of higher transportation costs.

Depending on whether the $1 million fee on Chinese-operated vessels, the $1.5 million fee on Chinese-built vessels, or both cumulative fees are applied, bulk agricultural exporters could face an additional $372 million to $930 million in annual transportation costs. On a per-unit basis, these compounded fees translate to an increase of 9.5 to 27.75 cents per bushel of soybeans — representing a substantial margin loss in global markets where competitiveness is often determined by mere pennies per bushel.

Containerized agricultural exports, which account for around 30% of U.S. waterborne ag exports by volume, would not feel the same level of direct impact. The World Shipping Council estimates the proposed fees could add $600 to $800 per container, but because container ships often arrive in the U.S. full and return to Asia empty, these costs are expected to fall more heavily on imports. However, many U.S. farmers and ranchers rely on imported inputs — such as fertilizer, feed ingredients, machinery, and specialty crop supplies — that can be transported in containers. Higher container shipping costs could therefore raise input prices, squeezing producers’ margins. If carriers pass additional charges onto outbound containerized exports, value-added ag products like meat, dairy, processed foods and specialty crops would also face rising costs.

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