COSCO Vows Service Stability as U.S. Port Fees Threaten $1.5 Billion Hit
Sep 18, 2025
Chinese shipping giant COSCO has affirmed its commitment to maintaining “stable and reliable services” in the United States despite looming port service fees that analysts project could cost the company $1.5 billion annually and erode nearly three-quarters of its expected 2026 profits.
In a customer advisory, COSCO addressed concerns about the U.S. Trade Representative’s port fee policy, which takes effect in less than a month on October 14, 2025. The fees target maritime transport services provided by Chinese operators and shipowners, as well as operators using Chinese-built vessels.
“While the port service fees may pose certain operational challenges, COSCO SHIPPING Lines remains confident in our ability to ensure stable and reliable services in the United States,” the company stated. “We are committed to maintaining stable capacity deployment and service quality, consistently delivering reliable, secure, and high-quality logistics solutions.”
The USTR announced the comprehensive plan in April, following a year-long Section 301 investigation and extensive public consultation. According to U.S. Trade Representative Ambassador Jamieson Greer, the measures aim to “begin to reverse Chinese dominance, address threats to the U.S. supply chain, and send a demand signal for U.S.-built ships.”
The fee structure operates on two tiers. Chinese vessel owners and operators will be charged based on net tonnage of vessel capacity per U.S. voyage at $50 per net ton, with annual increases of $30 per ton over three years, reaching $140 per net ton by 2028. Individual vessels face a cap of five assessed fees per year.
Non-Chinese operators using Chinese-built vessels will pay lower rates starting at $18 per net ton or $120 per discharged container, whichever is higher, eventually reaching $33 per net ton or $250 per container by 2028.
For a typical Chinese-operated container ship of about 50,000 net tons—common in COSCO and OOCL’s transpacific fleet—this represents a staggering $2.5 million per voyage initially, escalating to $4 million in 2026, $5.5 million in 2027, and peaking at $7 million per voyage by 2028, according to gCaptain assessment.
According to HSBC analysis, these fees will have devastating financial implications for Chinese carriers. The bank forecasts annual port fees of $1.5 billion for COSCO Shipping (CSH), which would erode 74% of its consensus 2026 estimated EBIT. Orient Overseas Container Line (OOIL) faces projected fees of $654 million, equivalent to 65% of its forecasted earnings.
The impact discrepancy between Chinese and non-Chinese carriers is stark. HSBC notes that non-Chinese carriers will only face fees if they deploy Chinese-built ships on U.S. port calls, and “they have sufficient non-China built ships to deploy to avoid the fees.” Currently, 71% of global container capacity by TEU is non-China built, compared to just 15% of 2024 U.S. port calls by tonnage that used Chinese-built vessels.
Major shipping alliances are already adapting their networks. According to HSBC, Premier Alliance plans to split its Mediterranean Pacific South 2 pendulum service into separate services, enabling it to remove 10 China-built ships from U.S. port calls. Maersk and Hapag Lloyd have begun deploying Korea-built ships on transpacific routes.
Chinese carriers have potential mitigation strategies. HSBC suggests that COSCO and OOIL could leverage their Ocean Alliance partnerships with CMA CGM and Evergreen, having these non-Chinese partners deploy more non-Chinese built ships in transpacific routes while COSCO and OOIL shift capacity elsewhere. Another option involves services that bypass U.S. ports entirely, relying instead on transshipments from Canada, Mexico, or the Caribbean.
The network realignment could temporarily tighten shipping capacity. The port fee policy may also delay the scrapping of older non-China built vessels, which account for 93% of the container fleet older than 20 years (representing 12.5% of the overall fleet).
COSCO’s statement emphasized its long-standing compliance with U.S. regulations, noting the company “has been deeply engaged in the U.S. market, strictly complying with all applicable U.S. laws, regulations, and policy requirements.” The carrier pledged to “demonstrate resilience and determination, with a commitment to service excellence and value delivery” as it continues serving the U.S. market.
The USTR policy includes key exemptions for U.S.-owned vessels, vessels enrolled in U.S. Maritime Administration programs, smaller vessels, ships in ballast, short sea shipping trades, and certain specialized export vessels.
The port fees represent a scaled-back version of earlier proposals. The final action plan excludes previously proposed measures such as flat fees of $1-1.5 million per port entry for operators with high shares of Chinese-built vessels and penalties based on future orders of Chinese-built ships.
A second phase of the USTR action, scheduled to begin April 17, 2028, will target the LNG sector by requiring a portion of U.S. LNG exports to use U.S.-built vessels. This requirement will phase in over 22 years, acknowledging U.S. limitations in LNG shipbuilding capacity and expertise.