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Ship Photo of The Week
The SS United States under tow off the U.S. East Coast to Mobile, Alabama, where it will be prepared to be sunk off the coast of Florida to become the world’s largest artificial reef. Photo courtesy Captain Mike Vinik of the towing vessel “Vinik No. 6”
Top Stories
Steep Fees on Chinese-Built Ships
The U.S. Trade Representative (USTR) has unveiled a bombshell proposal: massive fees on Chinese-built vessels calling at U.S. ports and operators with “Made in China” fleets, sparking fears of supply chain disruptions and soaring shipping costs. The move, part of a broader Section 301 probe, aims to curb China’s dominance in global shipbuilding but could reshape international trade in the process.
Under the plan, Chinese-built ships would face fees of up to $1.5 million per U.S. port call, with additional penalties ranging from $500K to $1 million per port call for operators reliant on Chinese shipyards.
According to Alphaliner data, 32% of the global container fleet is Chinese-built, meaning the world’s top ocean carriers–including MSC, Maersk, CMA CGM, Hapag-Lloyd, and, of course, China state-owned COSCO–would face substantial fees when calling at U.S. ports. Drewry estimates the proposed fees could add $2 million to $3 million per sailing for typical containerships servicing U.S. trade routes, equating to approximately $222 and $500 per TEU of ship capacity. Analysts are predicting the costs will ultimately trickle down to importers and consumers, potentially inflating freight rates.
Industry experts warn that ocean carriers will likely take evasive maneuvers to avoid these fees by calling at fewer U.S. ports, which could trigger major congestion and delays reminiscent of the COVID-19 congestion. Others might sidestep the fees by rerouting cargo through Canada and Mexico, opting instead to the 25% tariff hit on cross-border imports.
Meanwhile, USTR’s plan also includes certain refunds for U.S.-built ships, new U.S.-flag cargo requirements, and restrictions on China’s LOGINK logistics platform, citing security risks. With a public hearing set for March 24, the industry is on edge. If implemented, these measures could shake up global shipping, fuel trade tensions, and leave businesses scrambling to adjust. Buckle up—there could be rough seas ahead.
Russia’s Shadow Fleet Still in the Crosshairs
The UK and EU continue to tighten the screws on Russia’s shadow fleet, rolling out more major sanctions to mark three years since Russia’s invasion of Ukraine in a bid to choke off Moscow’s maritime oil trade. The UK has blacklisted 40 more vessels, bringing its total to 133 tankers. Meanwhile, the EU’s 16th sanctions package targets 74 additional ships, pushing its total to 153 vessels.
Beyond blacklisting ships, the EU has also slammed the brakes on a major loophole—banning temporary storage of Russian oil in EU ports, effectively shutting down a workaround in the G7 price cap system. Major Russian ports aren’t spared either, with top export hubs now under transaction bans, as well as third-country facilitators of Russia’s shadow fleet.
With oil revenues fueling Russia’s war machine, the West is betting big that these new measures will make it harder for the Kremlin to keep its war chest full.
Tariffs A Comin’
President Donald Trump confirmed that his 25% tariffs on Mexican and Canadian goods will take effect March 4, alongside an additional 10% duty on Chinese imports—doubling the February tariff and bringing the total to 20% on Chinese goods.
The move, Trump says, is a direct response to fentanyl trafficking, calling out a lack of progress from Mexico and Canada in stopping drug flows. Trade tensions are heating up. China has hit back with limited tariffs on U.S. goods but could escalate further if Trump’s new levies remain in place. Meanwhile, Mexican and Canadian officials are scrambling for last-minute talks in Washington to forestall the tariffs—but for now, the March 4 deadline stands.
Saipem & Subsea 7 Dive Into Mega Merger
Offshore energy giants Saipem and Subsea 7 are joining forces in a blockbuster all-share deal to create Saipem7, a new powerhouse in offshore energy services. With a €43 billion backlog, €20 billion in revenue, and €2 billion in core earnings, the combined company is set to dominate deep-sea engineering and installations.
Analysts have raised concerns about antitrust risks, but the firms downplayed competition worries, noting their complementary geographies—though they do clash in Brazil’s growing offshore market. The merger is expected to unlock €300 million in annual savings, but for now, investors remain cautious.
Dockworkers Ratify Historic Contract
The International Longshoremen’s Association (ILA) has overwhelmingly ratified a new six-year master contract with the United States Maritime Alliance (USMX), locking in record wage increases and protections against port automation through 2030 at U.S. East and Gulf Coast ports. With nearly 99% approval, ILA President Harold Daggett hailed it as “the greatest contract in ILA history.”
Key wins include a 62% wage hike, enhanced benefits, and guarantees against job losses from automation. The deal follows an October 2024 coast-wide strike and months of tense negotiations, culminating in a final agreement on January 8.
The ILA credited President Donald Trump for backing their anti-automation stance, with Trump congratulating dockworkers on Truth Social: “Slowing down automation, just a little bit, is an OK thing to do!!!”.
USMX, representing shipping companies and port operators, insists modernization is key to efficiency and economic growth, but for now, the ILA has secured its ”gold standard” contract—set to be formally signed on March 11, 2025.
Hunt for MH370 Resumes
A decade after Malaysia Airlines Flight MH370 vanished, the search is back on—kind of. A ship operated by U.S. firm Ocean Infinity has deployed to the Indian Ocean in hopes of cracking one of aviation’s greatest mysteries, though Malaysia has yet to sign a contract officially greenlighting the hunt.
Malaysia’s Transport Minister Anthony Loke confirmed the ship’s movement, calling it a welcome step but emphasizing that the deal still needs to be finalized. Ocean Infinity plans to expand the search zone by 15,000 sq km, focusing on an area it “missed in the past.”
The last search ended in 2018, after two failed attempts by Ocean Infinity and a 120,000 sq km search by Australia, China, and Malaysia. While confirmed debris has washed ashore in Africa and the Indian Ocean, the main wreckage remains elusive—as do definitive answers about the plane’s fate.
Argentina Lifts 50-Year Ban on Live Exports
For the first time in over five decades, Argentina is allowing the export of live cattle for slaughter, marking a major shift in its agricultural policy. The government framed the move as a way to boost competition in the meat industry, aligning with President Milei’s broader push to deregulate South America’s second-largest economy.
This follows Milei’s recent decision to cut export taxes on grains for five months to stimulate foreign sales. Argentina’s agricultural exports are a critical source of hard currency, helping fund imports and pay down national debt.
Last year, the country exported 935,000 metric tons of beef, with China snapping up nearly 70% of it. While Argentina is known for its legendary asado barbecue, it’s now betting that live cattle exports will bring even more economic sizzle to its recovering economy.
U.S. Tightens Noose on Iran (Again)
The U.S. Treasury has stepped up its crackdown on Iran’s illicit oil trade, slapping sanctions on 13 more vessels and over 20 individuals and entities spanning multiple countries. The move is part of President Trump’s renewed “maximum pressure” campaign, aiming to choke off Tehran’s oil revenue used for regional destabilization.
The latest sanctions target key tankers involved in ship-to-ship transfers to obscure Iranian oil’s origins. As Iran doubles down on deceptive shipping tactics, Washington is ramping up enforcement, setting the stage for an escalating maritime sanctions battle.
Typo Topples Containers Off California Coast
A data entry blunder led to 23 containers plunging into the Pacific and another 10 crushed aboard the U.S.-flagged containership President Eisenhower on February 6, 2024. The NTSB investigation traced the mishap to wildly inaccurate weight entries, where containers 10 times heavier than reported were misstacked, creating a dangerously top-heavy load.
The booking agent mistakenly logged 39 containers at just 5,511 lbs each, when in reality, they weighed up to 63,000 lbs. This reverse stratification—heavier units stacked atop lighter ones—combined with an 18-degree roll in rough seas, caused a catastrophic collapse near Oakland, California. Total damages? $735,000.
APL Maritime Ltd. insists the ship would never have sailed if the actual weights had been known. In response, the booking agent has tightened verification procedures, ensuring automated weight tracking to prevent another costly game of stacking gone wrong.
Rum vs. the Jones Act
Hawaii’s Koloa Rum Company is taking the Jones Act to court, arguing that the 1920 shipping law unfairly burdens businesses in Hawaii and Alaska. The lawsuit, filed Feb. 25 in Washington, D.C., claims the Port Preference Clause of the U.S. Constitution prohibits Congress from favoring some states’ ports over others—something the Jones Act allegedly does by driving up shipping costs for non-contiguous states.
Under the Jones Act, all goods transported between U.S. ports must be carried on U.S.-built, -owned, and -crewedships. Critics, including Koloa Rum CEO Bob Gunter, argue the law creates a costly monopoly that forces Hawaii-based businesses to pay exorbitant prices for both imports and exports.
Represented by the Pacific Legal Foundation, Koloa is seeking a declaratory judgment against the law’s application to Hawaii and a permanent injunction blocking its enforcement. If successful, the case could upend U.S. maritime trade regulations, drawing intense scrutiny from shipping companies, policymakers, and businesses nationwide.
As always, we’d love to hear your feedback. Email [email protected] with any questions, comments, tips, or concerns. Don’t forget to check out the Club Discord and gCaptain.com for the latest maritime news.
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