On the 24th (local time), attention from the shipping industry is focused on the public hearing held by the United States Trade Representative (USTR). At this public hearing, the outline of fees and restrictions imposed on Chinese shipping companies and ships by the USTR is expected to be revealed. Since it targets the Chinese shipping and shipbuilding industry, it is anticipated that competitor South Korea will also be affected.
The USTR previously announced plans to impose a fee of $1 million (about 1.5 billion won) on ships from Chinese shipping companies entering U.S. ports and $1.5 million (about 2.2 billion won) on Chinese-built ships. After gathering industry opinions at the public hearing, if U.S. President Donald Trump signs the executive order, it will be implemented immediately.
This is a measure introduced by the Trump administration to curb China’s maritime aspirations, but it is expected to affect the global shipping and shipbuilding industry, as China holds an overwhelming share in the world’s shipping and shipbuilding sectors. According to Clarkson Research, last year, China secured about 70% of new ship orders.
Shipping companies also possess a significant number of Chinese-built ships. According to the Norwegian container freight analysis company Xeneta, the shipping companies with a high proportion of Chinese-built container ships include COSCO (64%), ZIM (41%), CMA CGM (41%), ONE (27%), and Hapag-Lloyd (21%).
South Korea has a relatively low proportion of Chinese-built ships. HMM has a total of 82 ships, of which 4 are Chinese vessels. SM Shipping has 12 ships and 2 chartered ships, making a total of 14 ships, with the 2 chartered vessels being Chinese-built. The strategy may change to deploy Chinese-built ships on shorter routes or not to deploy them on routes to the Americas.
Shipping companies overseas that find it difficult to immediately reduce the proportion of Chinese-built ships are seeking solutions through alliance systems and investments in the United States. French shipping company CMA CGM announced it would invest $20 billion (about 29 trillion won) in building U.S.-flagged ships over the next four years. Following this, CMA CGM agreed with Denmark's Maersk to exchange vessel capacity on the Asia–U.S. West Coast route and the West India–U.S. East Coast route. Japan's ONE, which has a high proportion of Chinese-built ships, is seeking solutions by forming the Premier Alliance with Taiwan's Yang-Ming and South Korea's HMM.
There is also a forecast that shippers avoiding Chinese shipping companies and Chinese-built ships will benefit South Korea. An industry insider noted, "Every time ships pass through U.S. ports and incur fees of hundreds of millions of won for Chinese-made vessels, shippers may look for ships from South Korea or Japan. We need to confirm specific matters regarding what fees will be imposed at the public hearing."
Already in the U.S., the effect of the anticipated regulations on Chinese-built ships is being felt. The American Petroleum Institute (API) expects that the shortage of vessels will negatively impact the export of crude oil and liquefied natural gas (LNG). Farmers have also expressed concerns that they will face difficulties in exporting agricultural products such as corn, soybeans, and wheat.
With expectations that cargo volume will decline due to tariff imposition by the Trump administration, the shipping index has been on a continuous decline. On the 13th, the Shanghai Containerized Freight Index (SCFI) recorded a drop of 116.96 points (P), down to 1319.34, marking the lowest level in 15 months since December 2023.