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The proposed fee under the USTR framework could render China-owned and China-operated vessels redundant for US trade. This likely triggers a shift in port calls, with non-Chinese vessels continuing to serve US ports, while Chinese-operated or owned ships are redirected elsewhere.

Given the US’s relatively small stake in the global dry bulk trade, non-Chinese vessels should be sufficient to meet its demand. The 180-day cooling-off period may provide the industry time to adjust to these new dynamics. However, the measure could significantly affect major Chinese players in the dry bulk market, such as COSCO, Pacific Basin and CDB Leasing, that maintain a presence in the US. These players may need to explore alternative cargo opportunities to offset the impact.

Overview of the policy and market exposure

The global dry bulk fleet is heavily dominated by Chinese-built and Chinese-operated vessels, constituting approximately 53% of the total fleet. Under the previous USTR policy, operators with any Chinese-built vessel in their fleet or orderbook were subject to compliance fees, limiting the fee-free operating pool to just 20% of the global fleet. The new policy has relaxed this stipulation and has issued some exemptions, thereby softening its overall effect on fleet operations.

Figure 1: Vessels not affected by USTR policy increased to 60% of the total fleet

Source: Drewry Maritime Research

Segment-level impact: Spotlight on Capesize

The Capesize sector is expected to be the least affected by the revised USTR policy, not because of an exemption but due to its distinct trade patterns.

While the US does employ Capesize vessels for some bulk commodities, their participation in US trade is limited. As a result, despite being technically subject to Annex II of the policy (which targets Chinese-built vessels above 80,000 dwt), only 7% of the Capesize vessels within the policy’s scope made port calls in the US between 2024 and 1Q25.

That said, any China-owned or Chinese-operated Capesize vessel calling at a US port from October 2025 onwards would incur a significant fee—$3 million per call, or $1.1 million if it falls under Annex II. This creates a substantial cost risk for the limited cases where Capesize vessels are involved in US trade.

Realignment and strategic adjustments

A 180-day cooling-off period before fully implementing the fee regime offers a critical window for fleet and trade realignment. During this time, operators are expected to:

Reassign vessels to avoid US exposure
Shift cargoes to non-Chinese-built or operated vessels
Explore partnerships with unaffected carriers

However, the ability to realign fleets is not uniform across operators. Nearly 1,000 operators have only a single Chinese-built vessel in their fleet. Realignment options are limited for such operators, particularly if that vessel regularly serves US routes and may require significant commercial disruption.

On the other hand, major operators like COSCO Shipping, Oldendorff Carriers, Star Bulk Carriers, Golden Ocean Group and Vale, with more than 70% of their fleets Chinese-built, are likely to face substantial challenges while trying to avoid fee exposure. Their options to reroute or substitute vessels may be constrained, leading to operational inefficiencies and higher costs.

The Panamax segment is the most exposed among all vessel segments because it has the highest number of vessels under the policy's purview. This is also due to its high US trade representation and vessel size, which falls under Annex I. Many Panamax vessels regularly serve long-haul grain trade routes, such as the USG to Japan, which are subject to fees.

Figure 2: Only 17% of USTR policy-affected vessels made port calls at US ports between 2024-1Q25

Source: Drewry Maritime Research

The cost impact on this route is significant, as freight rates could increase by nearly $15 per tonne, translating to a 25% rise in spot rates per voyage. This directly affects competitiveness in key export markets, particularly for bulk commodities like grain.

Short-haul trades and exemptions

One of the policy's bright spots is the exemption granted to short-haul routes under 2,000 nautical miles, which benefits trade between the US and nearby countries such as Canada, Mexico and the Caribbean. These routes, often served by Handysize and Supramaxes, are insulated from the policy's cost burdens and will likely remain stable.

Additionally, ballasting vessels entering US ports (those not carrying cargo) are exempt from the fee, reducing exposure for repositioning vessels, particularly for outbound grain trades.