The American Association of Port Authorities (AAPA) recently submitted comments to United States Trade Representative (USTR) Ambassador Katherine Tai, urging her office to reverse the decision to impose a 25% tariff on Chinese-built ship-to-shore (STS) cranes. While AAPA supports efforts to spur the manufacture of critical port equipment in America, unfortunately, there are presently no firms capable of building large cranes domestically.

“Simply put, AAPA is confident that the tariff, if imposed, will not meet its stated objectives," said Cary Davis, AAPA’s President and CEO. "Instead, it will only result in negative outcomes, including grave harm to port efficiency and capacity, strained supply chains, increased consumer prices, and a weaker U.S. economy.”

In the comments, AAPA focused on the impacts of the proposed tariff on the economy. Since there are no domestic alternatives, the tariff will increase infrastructure development costs by millions of dollars per terminal. It could also force port authorities and private marine terminal operators (MTOs) to scale back plans for new infrastructure development to make up additional costs.

AAPA was joined by a chorus of ports and other industry partners echoing similar arguments.

Currently, there are at least seven ports that have 35 STS cranes on order from Chinese manufacturers. These contracts were signed prior to the announcement of the proposed 25% tariff and will now impose these ports with at least $131 million in new, unexpected costs.

AAPA has also taken steps to incentivize domestic manufacture of STS cranes through a cooperative agreement with the Maritime Administration (MARAD). Our organization is surveying port authorities and MTOs to anticipate the “order book” of ports’ cargo handling equipment needs over the next five and ten years. This can be used by the Federal Government and private manufacturers to link the public and private funding needed to bring crane manufacturing back to America. However, even in a best-case scenario, it will take years for a company to stand up manufacturing capacity and produce enough STS cranes to compete in the world market.

AAPA will continue to push back against tariffs that will ultimately pass costs on to consumers and businesses. Ahead of an expected August 1, 2024 effective date for STS crane tariffs, AAPA encourages USTR to delay their implementation at least until a domestic manufacturer is able to provide an alternative.