Steelmakers and shippers clash over Trump’s tariffs on Chinese ships

At an Office of the US Trade Representative hearing on the proposal, more than 30 witness statements were peppered with members of Congress jumping in virtually to remark on the state of the US shipbuilding industry. US lawmakers, labor unions and steel manufacturers were at odds with shipping companies and farm exporters over a Trump administration proposal to put million-dollar levies on China-linked ships docking in the US. At an Office of the US Trade Representative hearing on the proposal, more than 30 witness statements were peppered with members of Congress jumping in virtually to remark on the state of the US shipbuilding industry. While there was broad agreement that China’s dominance should be addressed, there was concern the levies would do more harm than good. Ocean carriers and farm exporters said the fees would snarl global supply chains and tank whole sectors of the US economy.

World Shipping Council Chief Executive Officer Joe Kramek called on the USTR to drop the fees, arguing “order backlogs – especially from the military – and labor shortages constrain the ability of US shipyards to take on additional orders.

Mike Koehne, representing the American Soybean Association, said agriculture already is under strain and the fees would lead to farmers having to pay more for key tools such as fertilizer and seed, giving rivals an edge. Members of Congress representing labor interests applauded the measure, saying the fee would fund reinvestment in the shipbuilding sector.

US Representative Chris Deluzio said his constituents have seen jobs lost to companies overseas and he wants to support the shipbuilding industry to boost capacity and increase the workforce. “USTR remedies are a step in the right direction,” said the Pennsylvania Democrat. Congresswoman Debbie Dingell said the US has lost more than 70,000 shipyard jobs in recent decades and now ranks 19th globally in global shipbuilding.

The US produces less than 10 oceanic commercial vessels a year, while China produces over 1,000,” said the Michigan Democrat. Dingell said she also supports another aspect of the Trump proposal that US goods be shipped on a share of US flagged, built and crewed vessels that would increase over time.

Steel industry representatives also backed the proposal, saying they were ready to ramp up capacity to meet demand for the increased steel and components needed to build new ships.

 Patrick Bloom, executive vice president of steelmaker Cleveland-Cliffs Inc., said his company was poised to double or even triple capacity if called upon, adding “actions of this magnitude” are needed to compete against China.