Navigating Global Freight Uncertainty: What Importers and Exporters Should Be Doing Now

Global supply chains continue to operate in an environment of heightened volatility. While international freight has always been cyclical, current geopolitical instability, ongoing conflict, and cost pressures mean importers and exporters must be more proactive than ever in managing their logistics risk.

At McHugh Eastwood, we are frequently asked what decisions businesses should be making in these “crystal ball” times. While no one can predict exactly how conditions will unfold, there are several key areas we believe shippers should focus on right now.

Fuel and Bunker Surcharges: A Moving Target

Fuel remains one of the biggest cost variables in freight.

• Fuel surcharges are being reviewed weekly across land transport, air freight, and ocean shipping
• Shipping lines and airlines continue to adjust bunker and jet fuel surcharges in response to market movements
• Inland transport costs are similarly affected, particularly for regional and long-haul deliveries

Our recommendation:

Build flexibility into your logistics budgets and expect surcharge volatility. Where possible, seek transparent surcharge breakdowns and ensure landed cost calculations are reviewed regularly rather than locked in months in advance.

War Risk Surcharges Can Be Introduced Without Notice

Ongoing conflicts are directly impacting major shipping lanes.

• Shipping lines have the right to impose war risk surcharges at short notice
• These surcharges can apply suddenly and significantly increase freight costs
• Affected routes can change quickly depending on geopolitical developments

Our recommendation:

Importers and exporters should avoid assuming freight rates are fixed. Always allow contingency for additional risk-related surcharges and seek guidance on alternative routing where available.

Insurance Costs Are Increasing

The impact of war does not stop at freight rates.

• Cargo insurance premiums are rising, particularly on higher-risk routes
• Some insurers are tightening coverage terms or exclusions
• Underinsurance is becoming a real risk for shippers unaware of changing conditions

Our recommendation:

Review your cargo insurance arrangements closely. Ensure values, coverage scope, and exclusions are clearly understood, and confirm that risk areas are adequately insured.

Understand Who Bears the Risk: Review Your Incoterms

In volatile markets, responsibility matters more than ever.

• Under Incoterms, shipping costs and risks do not always sit with the carrier
• Importers and exporters often carry the financial exposure when surcharges or delays occur
• Misunderstanding Incoterms can lead to unexpected costs and disputes

Our recommendation:

Take the time to review and understand the Incoterms used in your contracts. Knowing exactly where cost and risk transfer occurs is critical in the current environment.

Early Bookings Are Essential

Capacity constraints remain an ongoing challenge.

• Space on vessels and aircraft can tighten rapidly, particularly during disruption
• Last‑minute bookings often come with higher costs or limited options
• Even traditionally stable lanes can face congestion with little warning

Our recommendation:

Book freight as early as possible to secure space and reduce exposure to premium pricing. Early planning provides more routing options and improves supply chain reliability.

Final Thoughts

While uncertainty is likely to remain a feature of international shipping for some time, informed planning and proactive decision‑making can significantly reduce risk. Working closely with experienced freight partners, understanding contractual obligations, and staying flexible on costs and timing are key to navigating today’s freight environment.

McHugh and Eastwood continues to actively monitor global developments and work with clients to adapt logistics strategies as conditions evolve.

For questions and expert advice, you may get in touch with our customer support team.