Port fees imposed by US President Donald Trump’s top trade ambassador could contribute to pressure on the country’s imports in the container and car carrier trades, an investment bank analyst warned.
Stifel analyst Benjamin Nolan said that although the fees announced by US trade representative Jamieson Greer are not as severe as had been feared, they add up.
“While the impact of these port fees on US exports is hard to assess, we do view it as a potential negative for automotive and container imports,” the analyst said.
Nolan made the comments in a note focused on the rail sector, a reflection of the broader supply chain impact of the fees.
On Thursday, Greer unveiled port fees on vessels owned, operated or built by Chinese companies, as well as car carriers built in any country.
After a year-long investigation into Beijing’s support for its shipbuilding and shipping sectors, Greer has imposed a fee of $50 per net tonne for vessels owned or operated in the country.
Chinese-built vessels will pay $18 per net tonne or $150 per container, although exemptions abound.
And car carriers built in any country will pay $150 per ceu.
Tariffs abound
The fees come as the Trump administration’s global 10% tariff, duties on automobiles and trade war with China are also threatening import volumes.
“On the container front, imports from China are already facing steep import tariffs that seem to be rising by the day,” Nolan said.
“These added costs will likely have to be passed on to consumers, limiting demand in the near term. There appears to already be a building decline in Chinese container shipments to the US, and that is likely to continue.”
Nolan said the vehicle carrier fees came as the seasonally adjusted annual rate, a car industry measure of sales, is already weak. That could discourage imports.
“So make sure you get your oil changed because you might be driving that car longer than you had planned,” Nolan quipped.
Earlier on Monday, analysts at Norwegian investment bank Fearnley Securities said tanker, bulker and gas carrier players would escape the worst effects of the port fees.
But for analysts Fredrik Dybwad and Nils Thommesen, the story for container ships and car carriers is different.
“The revised fee proposal will still have a meaningful impact on containers and car carriers,” they wrote. “But with higher port fees for Chinese operators (Cosco and OOIL) there could be upside pressure on container freight as the global fleet reshuffles.”
