Peter Sand, Xeneta Chief analyst spoke to CGTN Europe about Trump's tariffs on shipping industry.
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00:00to over that with Peter Sand, the Chief Analyst at the Shipping Market Tracker Exeneter.
00:05And Peter, welcome back. Good to see you. These are huge fees that the United States is proposing.
00:10What effect would it have on shipping costs and supply chains? And to me, the consumer,
00:17what does it all mean? When something like this hits the fan, obviously everybody pauses for a
00:25while considering their options. And mostly, of course, in the first case, that means the carriers
00:32operating the ships. They may call fuel ports. Most likely, they will also need to pass on those
00:38extra costs, of course, to their customers, who in the end will also pass them on to you and I
00:42as consumers. It seems to be the pass-through cost element and something that will definitely
00:48generate some problem and some revamping to the networks as we know them today.
00:53Now, U.S. exporters have obviously expressed their concerns. Do we know which sectors
01:00might be particularly affected? Without doubt, the consumers will mostly be affected by those
01:09fees that will hit container shipping. More so, container shipping often also calls more than
01:15one port when they arrive in the U.S. They call two to three ports on the West Coast. They call
01:21four to six ports on the East Coast and Gulf Coast, as opposed to bulk carriers or oil tankers
01:27that often call one port only. So it is a cumulative fee that will go up the more ports you call.
01:37Why is the United States particularly targeting shipping?
01:44I think the current administration is mainly targeting China. Shipping may just be the
01:49unfortunate collateral damage here, but you see also a raft of tariffs being set up mainly
01:56towards Chinese imports, but also towards neighboring partners, Mexico, Canada, and that
02:02leaves really shippers between a rock and a hard stone finding out in which way should they bring
02:09in their goods going forward, produced in Asia and consumed in North America, because right now
02:15they seem to be under attack from many different aspects of the current administration.
02:20So they pause and take a deep breath for a while until they find out what will actually be the
02:25long-term targets, what will stay in place in terms of tariffs and barriers to trade, and then they
02:31will act accordingly. Mr. Trump, he says, wants to rebuild the U.S. shipping fleet. How quickly,
02:41how easily can that be done? I don't think the proposal that is currently being tabled,
02:49and we have a hearing four days from now, will bring shipbuilding back to any meaningful extent
02:55into the U.S. They are basically building naval ships for their own purpose, and a few merchant
03:02ships also for their own purpose. Today we have less than 200 ships under the American flag,
03:08and fewer than those are built in the U.S. So this measure, as draconian as it may seem,
03:16is unlikely to bring shipbuilding back to the U.S. Peter, good to see you. Thanks for your time.