Numerous articles describe how current steel import tariffs could raise the cost of cars and homes. But not much attention has been given to their impact on shipbuilding costs.

Beginning in April 2029, the Office of the United States Trade Representative (USTR) will enforce a requirement that 1% of all liquified natural gas (LNG) exports from the U.S. be shipped aboard a U.S.-built LNG carrier. The U.S. hasn’t built an LNG carrier in nearly 50 years. 

Much of U.S. shipping’s newfound attention has rightly focused on the shipbuilding sector. For every new ship ordered, someone has to finance construction costs.

If you’re a shipping company that uses a Chinese leasing structure to finance your fleet but otherwise has no ties to China, what are you to do under the U.S. Trade Representative’s proposed measures?

With current uncertainty around global trade given the U.S. administration’s policy disruptions, now seems like an odd time for a shipping company to pursue a public listing in New York. 

These USTR fines, designed to target China’s shipbuilding dominance, inadvertently places Caribbean economies and smaller carriers at significant economic risk. The Bahamas and neighboring island nations, having minimal influence over vessel sourcing, face unintended but severe economic consequences.

CMA CGM's $20 billion pledge may be strategically timed to mitigate potential financial damage from a proposed policy targeting shipping operators with significant numbers of Chinese-built vessels, or who have ordered vessels from Chinese shipyards. 

For those looking to bet on the tanker market, going long the TD3C FFAs presents an interesting opportunity to take the same stance as an informed market player like PetroChina–but at a discounted entry price.