Cosco Shipping Denali
Photo: VesselFinder

About 1.29m teu of ocean capacity – equivalent to 17% of the containerships calling at US ports – could be affected if the US acts against perceived Chinese dominance of shipbuilding, according to consultancy Linerlytica.

On 16 January, following a nine-month probe, the US Trade Representative (USTR) deemed that China had targeted the global shipbuilding, maritime and logistics sectors for commercial domination, actions found to be “unreasonable” and “actionable” under the US 1974 Trade Act, Section 301.

The USTR did not suggest imposing penalties against China or Chinese-built ships, leaving it to new president Donald Trump, who returned to the White House yesterday.

The probe was launched at the request of the United Steelworkers and four other US trade unions, under the Trade Act, which allows the US to penalise foreign countries that commit “unjustifiable” or “unreasonable” acts, or burden US commerce.

Linerlytica’s analysis shows that, in terms of the proportion of China-built box ships operated by carriers’ in US-focused networks, the numbers are TS Lines (84%), Tropical Shipping (82%), King Ocean Service (77%), Swire Shipping (72%), Seaboard Marine (69%), Grimaldi Lines (61%) and Cosco/OOCL (52%).

Linerlytica observed: “Chinese-built ships account for 225 of the 1,045 ships currently deployed in the US (excluding Jones Act trades) compared with just 10 ships that were built in the US.”

Indeed, just 23,200 teu, or 0.3% of box ships calling at the US, are US-built.

South Korea remains the largest source of newbuilds trading to the US, but this is expected to change now these shipyards have lost their market-leading position to China, which accounted for 66% of the total capacity of containerships ordered since 2020.

The results of the USTR’s investigation come less than a month after US lawmakers introduced the Shipbuilding and Harbor Infrastructure for Prosperity and Security (SHIPS) for America Act, which recommends imposing a number of measures to encourage the return of shipbuilding to the US.

These include a 200% levy on US-flagged vessels repaired in China, a tripling of the US-flagged international trading fleet to 250 vessels, and to carry a certain volume of Chinese imports on US-flagged ships from 2029.

Underscoring the growing trade tension between the two superpowers, the bipartisan act has yet to be passed by Congress, but could be used by President Trump as an adjunct to the USTR’s findings.

Of the carriers listed above, it is interesting to note the inclusion of US-headquartered Seaboard Marine. According to the eeSea liner database, the company operates nine feeder/regional services between the US, using Miami as its chief hub, and Latin American ports.

According to the vesselsvalue.com database, Seaboard owns seven containerships, four of which were built in China, and has six on order, all from Chinese yards, due to be delivered this year and next.

Check out this clip of Hapag-Lloyd’s Henrik Schilling on the orderbook and planning for the Suez reopening

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  • Elton Tan

    January 22, 2025 at 4:47 am

    This trade war is getting really annoying and silly. End of the day, exporters, importers and the end users will need to pay the ultimate price because of this. This is regressing instead of progressing.