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Posted by Tom Jensen
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21 April, 2026
THE RESURGENCE of large-scale shipping line surcharges linked to the ongoing Middle East conflict has once again highlighted the imbalance between shipping lines and cargo owners — and the lack of meaningful protections available to Australian importers and exporters. In response, Freight & Trade Alliance (FTA) and the Australian Peak Shippers Association (APSA) have written to Prime Minister Anthony Albanese calling for stronger protections.
As vessels are re-routed to avoid the Red Sea, Suez Canal and Strait of Hormuz, shipping lines have rapidly imposed war risk, emergency conflict and fuel recovery surcharges, frequently layered on top of already elevated freight rates. While these disruptions are global, the way costs are passed on is not.
Immediate surcharges in Australia, regulated notice in the United States
In Australia, shipping lines are able to impose new surcharges with immediate effect, often applying them to cargo already booked or already on the water. Cargo owners typically receive little more than a circular notice, with no opportunity to adjust supply chain decisions, negotiate alternatives or budget for the additional cost.
There is no independent regulator empowered to assess whether such surcharges are proportionate, time limited or genuinely linked to incremental costs. In the United States, the Federal Maritime Commission (FMC), the independent US government regulator overseeing international ocean shipping, requires shipping lines to provide a minimum of 30 days’ notice before any new surcharge or tariff increase can take effect.
Importantly, the FMC has repeatedly rejected requests from carriers in early 2026 to fast-track Middle East related surcharges, ruling that market volatility alone does not justify bypassing transparency requirements.
For US cargo owners, this does not prevent surcharges — but it does ensure certainty, predictability and regulatory oversight, reducing the risk of retrospective or surprise pricing.
Costs of the Middle East conflict
Since early March 2026, major container lines have announced surcharges commonly ranging from US$1,500 to US$2,000 per TEU, rising to US$3,500–4,000 per container for reefers and specialised equipment.
In many cases, these charges apply indefinitely and are imposed on top of bunker adjustments, congestion charges and insurance related costs.
For Australian cargo owners, the impact has been immediate and material:
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Sudden cost increases with no notice.
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Charges applied to in transit cargo.
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Higher inventory holding and working capital costs.
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Limited ability to pass costs through contractually.
Unlike in the United States, Australian shippers have no regulatory forum to test whether these charges reflect actual incremental costs, nor whether they remain justified once conditions stabilise.
How other governments have stepped in: South Korea’s exporter voucher model
Some governments have gone further — directly recognising that geopolitical shocks should not automatically be borne by exporters alone. A clear example is South Korea, which has introduced large scale export and logistics voucher schemes specifically to offset freight increases caused by the Middle East conflict.
Since March 2026, the South Korean government has rolled out programs exceeding 130bn won (approximately A$150 million) in funding to support exporters facing shipping disruptions. These schemes allow exporters to claim government funded vouchers to cover increased ocean and air freight costs, war risk and emergency surcharges, rerouting and return shipping costs, and detention and demurrage.
Under these measures, exporters can access up to 100 million won (around A$115,000) under general export voucher programs, while targeted emergency schemes administered via KOTRA (the Korea Trade Investment Promotion Agency, South Korea’s government export and trade body) allow claims of up to 150 million won per company (approximately A$170,000) for Middle East related logistics disruption.
Crucially, government co-funding can cover up to 70 per cent of eligible logistics costs, with fast-track approval processes allowing affected exporters to access funding within days. Korean authorities have been explicit that the objective is to prevent exporters from losing international competitiveness purely from geopolitical events beyond their control.
Australia remains an outlier
Together, these international examples underline a simple point: supporting cargo owners does not require governments to control freight rates. But it does require basic safeguards, transparency and targeted relief.
Australia currently offers none of these. Shipping lines may impose surcharges without notice, without regulatory scrutiny and without any mechanism for cost sharing or exporter relief.
For an economy that depends heavily on international trade, that imbalance ultimately flows through to higher consumer prices, reduced export competitiveness and weakened supply chain resilience.
Until Australia modernises its approach — whether through notice requirements, regulatory oversight or targeted exporter support — local cargo owners will remain uniquely exposed whenever global instability returns to the shipping lanes.
