New Port Fee Policy Raises Costs for U.S. Agricultural Exports; However, Significant Reduction from Earlier Proposal
- ARPC NDSU
- 2 days ago
- 2 min read
Updated: 6 minutes ago
by Jiyeon Kim, Matthew Gammans, Shawn Arita, and Sandro Steinbach
A new ARPC report estimates that recently finalized U.S. port fees on Chinese-operated and Chinese-built vessels could increase shipping costs for U.S. agricultural exporters by up to $6.2 billion annually by 2028. The policy, issued by the Office of the U.S. Trade Representative (USTR) in April 2025 under Section 301 of the Trade Act, imposes phased-in fees on foreign vessels connected to Chinese ownership or construction.
The analysis utilizes 2024 U.S. port call and export data to estimate the impact of the Annex 1 (Chinese-operated vessels) and Annex 2 (Chinese-built vessels) fee schedules on dry bulk and containerized exports. Agricultural products, especially grains, are disproportionately exposed due to their reliance on dry bulk carriers and lower export value per ton.
In the first year of implementation, the policy is expected to increase total shipping costs by an estimated $2.3 billion. By 2028, when the full fee schedule is phased in, shipping costs are projected to reach $6.2 billion. Grain shipments, specifically corn, soybeans, and wheat, would be most affected, with estimated costs rising by 5 to 7 cents per bushel depending on crop and route.
The report also finds that fee burdens are highest for dry bulk shipments, where Annex 1 fees represent between 0.6% and 0.8% of the total export value. While exemptions for empty vessel arrivals reduce the number of fee-triggering voyages, they do not fully offset the impact on agricultural exporters.
The final policy incorporates several modifications from the original February 2025 proposal, including an extended implementation timeline, lower per-ton fee rates, and vessel-type exemptions, which together significantly reduced the expected impacts. However, the revised rule still may carry a significant cost for sectors that rely heavily on ocean freight, particularly U.S. agriculture.
The study was conducted by Jiyeon Kim, Matthew Gammans, Shawn Arita, and Sandro Steinbach as part of ARPC’s ongoing research on trade policy and market access risk.
2024 U.S. Agricultural Exporting Vessels Classified Under USTR Section 301 Annexes 1 and 2
Note: Agricultural exporting vessels indicate that vessels that are observed exporting agricultural products at least once in 2024.
Contact Information:
Jiyeon Kim, ARPC: jiyeon.kim@ndsu.edu
Matthew Gammans, ARPC: matthew.gammans@ndsu.edu
Shawn Arita, ARPC: shawn.arita@ndsu.edu
Sandro Steinbach, ARPC: sandro.steinbach@ndsu.edu
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