Japan’s Largest Shipper Abandons Chinese Yards Over Trump Port Fees

Mitsui O.S.K. Lines announced it will stop ordering LNG carriers from Chinese shipbuilders after the Trump administration revealed plans to impose port fees on China-made vessels.

The Japanese shipping giant operates the world’s largest fleet of liquefied natural gas carriers with 107 vessels. Company president Takeshi Hashimoto confirmed the strategic shift during a recent interview.

The decision affects future orders while existing contracts for six Chinese-built ships remain unchanged. Mitsui O.S.K. will redirect new orders to South Korean manufacturers instead.

The U.S. Trade Representative announced in April that Washington would begin charging new port fees on ships made or registered in China within six months.

This policy targets China’s growing dominance in global shipbuilding markets. Chinese yards now control over half of all new ship orders worldwide through competitive pricing.

Mitsui O.S.K. plans to expand its LNG carrier fleet from 107 to 140 vessels by 2028. The company expects growing demand for LNG transportation as the fuel emits 20 to 30 percent less greenhouse gas than oil.

China’s Ascendancy in LNG Carrier Construction

Japanese shipbuilders cannot handle bulk orders due to capacity constraints and labor shortages. China has become the second-largest builder of LNG carriers after South Korea.

Chinese shipyards captured approximately 38 percent of the global LNG carrier market compared to South Korea’s 62 percent share. Japanese builders received no LNG carrier orders over the past decade.

The Trump administration worries about China’s expanding influence in shipbuilding and shipping sectors. Although the U.S. and China agreed to reduce tariffs temporarily for 90 days, the outlook for port fees remains uncertain.

Japan imported 6.34 million metric tons of LNG from America in 2024, representing 10 percent of total imports. Japanese trading houses Mitsui & Co. and Mitsubishi Corp. participate in the Cameron LNG project in Louisiana.

Meanwhile, JERA and Osaka Gas manage the Freeport LNG project in Texas. Other major shipping companies face similar decisions regarding Chinese shipbuilders.

The global LNG carrier fleet operates approximately 660 vessels currently. Industry experts project fleet expansion to 1,040 vessels by 2029 as demand grows.

Nippon Yusen operates 89 LNG carriers, making it the second-largest fleet operator globally. The company also evaluates its relationship with Chinese shipyards amid changing trade policies.

South Korean manufacturers benefit from this shift as they maintain technological leadership in LNG carrier construction. The decision reflects broader concerns about supply chain security and geopolitical tensions.

Companies must balance cost considerations against potential operational disruptions from changing trade policies. This strategic realignment reshapes the global LNG shipping industry’s future development patterns.