US Port Fees on Chinese-Built Vessels

US Port Fees on Chinese-Built Vessels

May 20, 2025 | , , , , , , , , , , , , , ,

The United States Trade Representative (USTR) has finalised a revised plan to impose port fees on Chinese-built containerships calling at US ports.

This follows the reintroduction of the SHIPS for America Act, part of President Donald Trump’s broader push to revive the US shipbuilding industry and reduce reliance on Chinese maritime infrastructure.

While significantly less disruptive than the original February proposal, which threatened to add up to $1.5 million per port call and cost the industry $24 billion, the revised version will still increase shipping costs by approximately $1 million per voyage. These added costs may have ripple effects across global supply chains.

What’s Changing – and When?

USTR Port Fee

  • Start Date: Mid-October 2025
  • Escalation: Costs will increase every 180 days over a three-year period
  • Estimated Additional Costs:
    • Chinese operators (e.g. COSCO/OOCL): USD $250–$1,600 per TEU
    • Non-Chinese operators using China-built vessels: USD $100–$400 per TEU

Crucially, carriers will only be charged once per US rotation, not at every port call. Exemptions apply for:

  • Vessels under 4,000 TEUs
  • Voyages under 2,000 nautical miles
  • China-built vessels owned by US-based carriers

Carrier Reactions and Supply Chain Impacts
Most non-Chinese carriers are expected to redeploy tonnage to avoid the fees, shifting Chinese-built vessels away from US trades in favour of non-Chinese built ships. Some may elect to use transhipment hubs in the Caribbean to bypass direct calls to US ports.

Chinese carriers like COSCO and OOCL will be hardest hit. With limited ability to avoid the charges, these carriers may lean more heavily on alliance partners like CMA CGM or Evergreen, potentially distorting market dynamics and reducing competition on some transpacific routes.

Despite initial fears, widespread surcharges are currently seen as unlikely. Market competition and alternative capacity could prevent many carriers from passing costs directly onto shippers, tthough selective route-specific or carrier-specific fees may still emerge.

SHIPS for America Act
This proposed legislation, while not yet passed, aims to further penalise Chinese-built, -owned or -registered vessels. It also opens the door for other “countries of concern” to be added in future. No cost estimates have been released, but shippers should remain alert to potential follow-on impacts.

The evolving policy landscape introduces fresh uncertainty for importers and exporters, especially those with supply chains linked to Asia–US routes.

Metro is actively monitoring developments and engaging with carriers and industry bodies to stay ahead of the real-time implications. Our goal is to help customers navigate any changes smoothly and make informed decisions.

If your business could be affected by these measures, or you simply want to future-proof your supply chain with revised routing strategies and updated landed cost assessments, please EMAIL our Managing Director, Andrew Smith.

US and India Trade Deals Open Doors for UK Traders

US and India Trade Deals Open Doors for UK Traders

May 13, 2025 | , , , , , , , , ,

Two landmark trade agreements with the US and India promise to reshape supply chain opportunities for UK importers and exporters. Both deals offer a mix of immediate tariff relief and long-term potential to diversify sourcing and boost exports.

The newly signed UK-US agreement has reduced US tariffs on British automotive exports from over 25% to 10%, with an annual cap of 100,000 vehicles. While this cap closely matches current UK export levels, the reduced tariff eases pressure on British vehicle manufacturers, particularly those which had previously paused US shipments amid cost uncertainty. The agreement also removes the 25% tariff on UK steel and aluminium, helping lower input costs for UK manufacturers supplying US markets. However, US tariffs remain high for certain automotive parts and some categories of goods.

The agreement marks the first major trade pact since the imposition of US “Liberation Day” tariffs. While the deal falls short of a comprehensive free trade agreement, it provides immediate relief for supply chains and signals a willingness to continue negotiations on broader market access. The US has also committed to fast-tracking UK goods through customs, helping to ease some of the red tape associated with transatlantic trade.

In parallel, the long-awaited UK-India free trade agreement opens up new avenues for fashion and footwear supply chains. Tariffs on over 90% of UK exports to India, including clothing and footwear, will be phased out over a 10-year period. For Indian goods entering the UK, the deal eliminates nearly all levies, offering UK retailers access to competitive manufacturing without compromising quality.

The deal is particularly attractive for UK footwear brands and fashion houses already sourcing from India’s strong leather and non-leather production base. The expected reduction of tariffs and customs barriers is likely to enhance cost competitiveness and shorten lead times. With India’s middle class growing steadily—accounting for nearly a third of its population—the market also presents growing demand for high-quality, internationally recognised UK brands.

At the same time, the agreement offers UK fashion retailers a timely opportunity to diversify sourcing strategies away from markets where rising costs and geopolitical instability have made supply chains increasingly fragile. Industry experts believe some fashion retailers could improve margins by double digits once they fully leverage the benefits of the India deal.

For UK automotive exporters, the India pact includes a commitment to reduce tariffs on UK car exports from well over 100% to 10%. Although the final details of quotas and implementation remain under discussion, it represents the first step towards opening India’s protected automotive market to British manufacturers.

Both trade agreements offer UK businesses critical alternatives at a time of global uncertainty. They present clear potential for easing supply chain costs and improving market access for two key industries that underpin UK manufacturing and retail exports. However, much will depend on the full legal texts and how effectively the provisions are implemented in practice.

The new US and India trade agreements offer real and immediate opportunities. Whether you are looking to streamline transatlantic automotive exports, expand your retail footprint, or diversify fashion and footwear sourcing, Metro can help you unlock the full benefits of these landmark deals.

With decades of experience supporting UK importers and exporters, our expert team understands how to navigate new trade frameworks and optimise supply chain performance. We can help you fine-tune logistics, reduce costs and simplify customs compliance, to take advantage of the new tariff reductions and market access opportunities now on offer.

EMAIL Andy Smith, Managing Director, to find out how we can help you capitalise on these positive changes and build a resilient, agile supply chain ready for growth.

March Airfreight Surge Sets Stage for Further Growth as US-China Trade Tensions Ease

March Airfreight Surge Sets Stage for Further Growth as US-China Trade Tensions Ease

May 13, 2025 | , , , , , , , , , , , , , , ,

Airfreight markets posted a record performance in March, with particularly strong activity on Asia, US, Europe and UK trade lanes. The surge, driven by shippers front-loading cargo ahead of anticipated US tariffs, has provided a benchmark for what could follow in the months ahead as recent tariff reductions between the US and China hint at a renewed spike in activity.

According to IATA, global demand measured in cargo tonne-kilometres rose by 4.4% year-on-year, with international cargo traffic increasing by 5.5%. Capacity, meanwhile, increased by a similar margin, helping to stabilise load factors despite the sudden surge in volumes. Asia-Pacific carriers led growth with a 9.6% rise in demand and an 11% increase in available capacity. North American airlines recorded a 9.5% increase in volumes, while European carriers posted a more moderate rise.

Asia-North America remained the largest and fastest-growing trade lane by market share, as exporters sought to avoid the sharp rise in tariffs. The Europe-North America route also experienced strong activity and was the busiest overall in March, underpinned by steady intra-European demand which grew by 2%.

The operating environment provided further stimulus, with world industrial output and global trade volumes expanding by just under 3%. Falling energy costs provided additional support, with jet fuel prices down for the ninth consecutive month. Inflation rates also stabilised across key markets, providing additional certainty for international shippers. China’s deflationary environment also showed signs of softening, with the rate improving to just below zero.

The result was a sharp escalation in demand from sectors that rely on rapid supply chains and cannot risk ocean freight delays. Electronics, high fashion, automotive and perishable goods were among the leading commodities contributing to the increased volumes.

The extraordinary March performance may not remain an isolated event. The recent temporary US-China tariff reduction has the potential to trigger another wave of increased airfreight activity.

While the extent of future growth will depend on how negotiations between the world’s two largest economies unfold, the easing of tariffs has already bolstered market sentiment.

However, market analysts note that after the March peak, demand may return to more typical seasonal levels in the short term, particularly as capacity has increased by over 6% on international routes, offering more space for shippers. Yet, the fundamental reliance on airfreight for high-value and time-critical shipments between Asia, the US, Europe and the UK remains unchanged.

Should trade relations between the US and China continue to thaw, the market could be poised for another significant uplift in volumes. The key will be whether the current political stability translates into sustained confidence among exporters and freight forwarders across these critical trade lanes.

With airfreight demand surging and tariffs in flux, now is the time to optimise your supply chain strategy. EMAIL Elliot Carlile, Operations Director, to explore how we can help you secure space and streamline your international shipments.

Trump’s Red Sea Gambit

Trump’s Red Sea Gambit

May 13, 2025 | , , , , , , , , , , , , , , , , , ,

A dramatic shift in the Red Sea shipping crisis may be underway following US President Donald Trump’s announcement that Houthi militants have agreed to halt their campaign against commercial vessels.

His declaration has sparked hopes of restored freedom of navigation through one of the world’s most vital maritime corridors. However, conflicting signals from the Houthis and persistent security concerns leave the industry navigating uncertain waters.

Trump’s comments, made ahead of a high-profile meeting with Canadian Prime Minister Mark Carney on May 6, suggested that after months of military escalation, a breakthrough had been reached. The President claimed that the Houthis had “capitulated” and would cease missile and drone strikes on commercial shipping. He pledged that US airstrikes on Yemeni targets would also end in response.

Omani diplomatic sources have echoed the ceasefire narrative, pointing to coordinated discussions that purportedly yielded a de-escalation agreement and a commitment to non-aggression on both sides.

Yet, the Houthis have swiftly rejected Trump’s portrayal, asserting that no formal truce exists. According to Houthi representatives, the group’s military stance remains unchanged, particularly in relation to Israel, and any pause in attacks was a tactical decision rather than the result of concessions.

This ambiguity undermines confidence among major container lines, many of which continue to avoid Red Sea routes due to crew safety concerns and inflated insurance premiums.

If hostilities genuinely subside, container carriers could begin rerouting vessels back through the Suez Canal. Around 10% of global container capacity has been absorbed by the longer, costlier voyages around southern Africa. A return to Suez would free up this latent capacity, potentially exacerbating overcapacity issues already pressuring the industry. With the container vessel order book standing at about a quarter of the current fleet size, the market faces mounting risk of supply-demand imbalance.

Freight rates, which surged earlier due to the Red Sea crisis, could spike again if carriers resume shorter transits en masse, before softening once schedules settle back down. And while rate increases and extended lead times could finally see some relief the resulting supply-side glut may create new headaches for the container shipping lines.

Port activity along the Red Sea remains subdued, with volumes reportedly down by around half compared to last year. A reliable and lasting resolution could rejuvenate regional trade flows, benefiting not only global carriers but also Gulf-based shippers and transhipment hubs that have been cut off from direct east-west routes.

For now, the shipping industry remains caught between political theatre and on-the-ground reality. Whether Trump’s announcement marks the dawn of stability or another premature claim depends on actions in the Bab al-Mandab, not words in Washington.

The situation in the Red Sea remains unpredictable and liable to change. If your business relies on consistent global shipping operations, this is the perfect time to review your contingency plans and explore flexible alternatives. EMAIL Andy Smith, Managing Director, to learn how we maintain stability and keep supply chains running smoothly, whatever the challenge.

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