High sea new battleground for US-China trade war: Tit-for-tat shipping levies from today

The reciprocal tariffs on shipping ports imposed by the US and China will go into effect on Tuesday as the trade war between the two countries intensifies. The port fees on ocean shipping firms will affect the prices of several products.

Earlier this year, President Donald Trump’s administration unveiled plans to impose fees on China-affiliated vessels in an effort to reduce China’s dominance in the global maritime industry and strengthen US shipbuilding capabilities.

China reportedly uses unfair trading practices to dominate the global maritime, logistics and shipbuilding sectors, an investigation from former President Joe Biden’s era revealed.

Washington will begin collecting penalties for China’s wrongdoings from October 14. According to analysts, the Chinese container carrier COSCO will be the most affected by these levies, shouldering nearly half of that segment’s expected $3.2 billion cost from those fees in 2026.

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China hits back

China hit back last week, saying it would impose its own port fees on US-linked vessels, also starting Tuesday. Jefferies analyst Omar Nokta noted that 13 per cent of crude tankers and 11% of container ships in the global fleet would be affected.

“This tit-for-tat symmetry locks both economies into a spiral of maritime taxation that risks distorting global freight flows,” Athens-based Xclusiv Shipbrokers Inc said in a research note.

In a reprisal against China curbing exports of critical minerals, Trump on Friday threatened to slap an additional 100 per cent tariffs on goods from China and put new export controls on “any and all critical software” by November 1.

Just hours later, administration officials issued a warning that countries supporting a proposal by the United Nations’ International Maritime Organization to cut greenhouse gas emissions from ocean shipping could face consequences, including sanctions, port restrictions, or additional vessel fees.

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Trump cancels meeting with Xi

As he threatened an additional 100 per cent tariffs on Beijing, Trump also announced that an upcoming meeting with his Chinese counterpart, Xi Jinping, has also been cancelled.

Earlier this month, Trump said that he would meet with Xi to discuss trade and other related issues. However, now, Trump has said that he is likely to cancel a planned meeting with the Chinese leader.

The Trump-Xi meeting was expected to take place on the sidelines of the Asia-Pacific Economic Cooperation forum in South Korea at the end of October.

With inputs from agencies

“This was a real surprise, not only to me, but to all the Leaders of the Free World. I was to meet President Xi in two weeks . . . but now there seems to be no reason to do so,” Trump said.