FARGO, N.D. — June 24, 2025 — A new white paper from the Agricultural Risk Policy Center (ARPC) at North Dakota State University warns that recently finalized U.S. trade measures aimed at China’s maritime sector could significantly increase shipping costs for U.S. agricultural exporters, particularly for bulk commodities like corn, soybeans, and wheat.

The report, Assessing the Costs to Agricultural Exporters of Section 301 Annex 1 and 2 Fees, evaluates the economic impact of the U.S. Trade Representative’s (USTR) April 2025 final determination under Section 301 of the Trade Act of 1974. This policy imposes new port fees on vessels either operated by Chinese firms (Annex 1) or constructed in China (Annex 2). The research team simulated fee costs using detailed data on 2024 U.S. port calls, vessel characteristics, and agricultural export volumes.

According to the analysis, the new fee structure could raise total shipping costs by $2.3 billion in its first year, growing to $6.2 billion annually by 2028. The study highlights that bulk agricultural exports would be among the most exposed, with fee impacts estimated at 5 to 7 cents per bushel for major crops under current vessel routing patterns.

“This is a targeted policy, but is still going to affect agriculture exports,” said Dr. Jiyeon Kim, lead author and research economist at ARPC. “Even with exemptions for certain routes and empty vessels, dry bulk shippers will face higher costs, and those costs will likely show up in lower farmgate prices.”

The report finds that vessels exporting corn, soybeans, and wheat face fee burdens equivalent to 0.6–0.8% of the total value shipped, nearly three times the average fee share across all product categories. These impacts are amplified by the fact that dry bulk shipments, which dominate U.S. grain exports, have low value per ton and fewer route alternatives. While the final USTR determination includes necessary exemptions compared to earlier proposals, the burden remains disproportionately concentrated in the agricultural sector.

“The final rule significantly moderated the cost surrounding the initial proposal, but our findings show that agricultural exporters are still likely to face substantial costs,” said co-author Dr. Matthew Gammans. “That has real implications for competitiveness.”

The study highlights that the full impact of the policy will depend on future shifts in vessel ownership and routing decisions, but cautions that the structure of the fee schedule creates persistent headwinds for U.S. exporters in an already strained global logistics environment.

The full white paper is available at: https://ageconsearch.umn.edu/record/358893/files/ARPC%20White%20Paper%202025-02.pdf

Media Contacts:

Dr. Jiyeon Kim – jiyeon.kim@ndsu.edu
Dr. Matthew Gammans – matthew.gammans@ndsu.edu
Dr. Shawn Arita – shawn.arita@ndsu.edu
Dr. Sandro Steinbach – sandro.steinbach@ndsu.edu
Agricultural Risk Policy Center (ARPC)
North Dakota State University
www.ndsu.edu/agriculture/arpc