CMA CGM Resists Adding Surcharge Ahead of USTR’s China Port Fees—For Now

By Gavin van Marle (The Loadstar) – CMA CGM has become the latest major carrier to indicate that it will not add a new surcharge on shipments to the US that may be affected by the forthcoming port fees on Chinese-built vessels and Chinese carriers set to be implemented by the US Trade Representative on 14 October.

“Despite the challenges this new service fee may create for our operations, based on the current structure and applicability of the service fee, CMA CGM is not considering implementation of a surcharge on cargo shipped to or from the US at this time,” the Marseille-headquartered shipping line said in a statement today.

Under the terms of the USTR’s section 301 action against what it deems to be the Chinese government’s unfair support of its maritime industry, Chinese carriers – registered in China and Hong Kong but not Taiwan – will be levied $50 per net ton for any ship calling at the US, while China-built vessels will face a $120 per teu fee.

The fees are currently scheduled to increase successively over the following three years, and have raised fears among shippers and forwarders that carrier customers could be facing a new set of surcharges in a market which is showing extreme demand volatility.

The main problem for the French carrier is its membership of the Ocean Alliance which, along with Taiwan’s Evergreen, also includes Chinese shipping lines Cosco and Cosco-owned OOCL, which will be subject to port fees irrespective of whether they deploy Chinese-built vessels into US ports.

On the transpacific trades alone, the Ocean Alliance currently operates around 17 services – 10 to the west coast and seven to the east coast – in which Cosco and OOCL contribute substantial numbers of vessels, as well as a variety of other services on smaller trades that CMA CGM operates in vessel sharing agreements (VSAs) with either Cosco and/or OOCL.

Earlier this week, transport analysts at HSBC calculated that the USTR port fees could cost Cosco and OOCL a combined $2.1bn in extra costs next year.

However, today CMA CGM claimed it had drawn up new plans to mitigate against the USTR fees.

“CMA CGM is fully prepared and well-positioned to safeguard our customers’ interests. We operate one of the most flexible and diversified fleets in the industry.

“During the 180-day grace period following the 17 April USTR announcement, CMA CGM has taken the necessary steps to implement a robust and adaptive contingency plan.

“Thanks to the fleet and operational adjustments we are now implementing ahead of 14 October, we currently expect to both maintain our service coverage to all scheduled US ports and minimise any impacts of the upcoming USTR fees,” it added.

Subscribe for Daily Maritime Insights

Sign up for gCaptain’s newsletter and never miss an update

— trusted by our 108,043 members