The United States Trade Representative‘s office is holding public hearings this week on proposed actions in the Section 301 investigation of China’s targeting of the maritime, logistics, and shipbuilding sectors for dominance that would result in new fees being imposed on Chinese vessels. The first hearing was held on Monday, March 24 and the second will be on Wednesday, March 26.

More than 100 agricultural and biofuels organizations sent comments in a letter to USTR seeking an exemption for agricultural exports from both newly proposed fees on Chinese vessels and graduated sourcing requirements for U.S. built and flagged vessels “until such time as our nation’s ship production can meet the requirements needed to keep U.S. agriculture competitive in the global market.”

“While we support President Trump’s effort to rebuild the United States position and power in global shipping, we are worried the current fees and timelines cannot be achieved without substantial economic harm on the farm and in rural America,” the letter stated. “These are not idle concerns. U.S. commodity prices and agriculture exports have already been negatively impacted due to uncertainty regarding when trade actions would become effective. Vessel operators have told U.S. exporters they intend to pass on 100 percent of the cost of the port fees.”

Indiana soybean farmer and American Soybean Association director Mike Koehne testified Monday that the proposed solution offered by USTR in this investigation creates unintended consequences for soybean farmers. “Imposing port fees on most of the maritime fleet that exports from and imports to the U.S. will increase costs for U.S. farmers—both in terms of inputs like fertilizer, seed, etc., and getting crops to market. At the same time, our competitors in Brazil and Argentina will not be subject to the same regulations. While well-intended, this proposal would ensure U.S. soybeans will bear higher costs and be less competitive in the global marketplace.”