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Peak season survey reveals cautious confidence as demand strengthens

Aug 5, 2026 | , , , , , , , , , , , , ,

Metro's Q3/26 Peak Season Survey suggests businesses are entering the second half of the year with growing confidence, despite ongoing uncertainty across global supply chains.

While current shipping volumes remain mixed, the outlook for the next three months is positive. More than three-quarters of respondents expect shipping volumes to either increase or remain stable, with no respondents anticipating a decline. 

The findings indicate that businesses are continuing to adapt to market disruption, focusing on flexibility, resilience and proactive supply chain planning rather than waiting for conditions to return to normal.

Demand is being driven by real business growth

Unlike previous peak seasons, where activity was often influenced by front-loading or supply chain disruption, this year's demand appears to be supported by underlying market conditions.

Half of respondents identified genuine customer demand as the primary driver of shipping activity, while 37.5% pointed to inventory replenishment and restocking. Only 12.5% believed customers were bringing orders forward, and the same proportion cited carrier actions creating tighter supply. No respondents believed an earlier-than-usual seasonal peak was driving demand. 

Current shipping volumes remain varied. While 37.5% reported moderately higher volumes than the same period last year and 12.5% reported increases of more than 20%, an equal 37.5% said volumes were lower than a year ago. 

Looking ahead, confidence remains encouraging.

A quarter of respondents expect shipping volumes to increase significantly over the next three months, while 37.5% anticipate a slight increase and a further 37.5% expect volumes to remain stable. Significantly, none of those surveyed expect demand to decline during the remainder of the peak season. 

The results suggest businesses are planning for sustained activity rather than a short-lived seasonal spike.

Peak season has already begun

Three-quarters of respondents believe the traditional peak shipping season is already well underway, while only 12.5% believe it has yet to begin. A further 12.5% remain unsure. 

This reflects the continued resilience of international trade despite geopolitical tensions, longer shipping routes and higher transport costs.

However, an early start does not necessarily mean peak season will finish early. Over the past three years, an earlier summer peak has typically been followed by a second, smaller surge in demand during the fourth quarter, bookended by Golden Week in early October and the build-up to Chinese New Year. Many shippers are therefore planning for sustained demand through the remainder of 2026 rather than a single seasonal spike.

Red Sea transits remain under close review

As container carriers continue trial transits through the Suez Canal and Red Sea, businesses are monitoring developments carefully.

Three-quarters of respondents were already aware of the resumed transits. However, only a minority have fully reviewed their cargo insurance arrangements. Instead, 62.5% said insurance reviews are currently underway, while 25% have yet to assess whether their existing cover is suitable for regular Red Sea transits. 

The findings suggest confidence in the route is improving, but these results came before the recent Houthi attacks, so risk management remains a priority.

Flexibility is becoming the preferred strategy

Businesses are responding to market conditions by adapting existing supply chains rather than making wholesale changes to transport modes.

The most common response (37.5%) has been to alter shipping routes while maintaining the same mode of transport. Another 25% are considering alternative transport solutions if conditions deteriorate further, while 12.5% have already introduced sea-air services and a further 12.5% have switched some shipments to road transport. Meanwhile, 37.5% have not changed their transport strategy. 

Among those making changes, every respondent (100%) cited long transit times as the primary reason, with vessel capacity and port congestion receiving no responses. 

Agility is becoming more important than storage

When asked about warehousing priorities, 83.3% of respondents identified flexible transport alternatives as their greatest requirement, compared with 33.3% who highlighted low-cost short-term storage solutions. 

The findings suggest businesses are placing greater emphasis on maintaining supply chain agility than simply increasing storage capacity.

What the survey tells us

The results paint the picture of a market that remains resilient despite continued disruption.

Demand is being driven primarily by genuine customer activity rather than precautionary ordering, businesses are broadly optimistic about shipping volumes over the coming months, and most believe peak season is already underway.

At the same time, companies continue to manage risk carefully. Red Sea insurance arrangements are being reviewed, alternative routing remains under consideration, and flexibility has become a higher priority than simply securing additional warehouse space.

As peak season develops, Metro can help keep your supply chain agile. We'll review your transport strategy, identify opportunities to improve resilience and help you respond quickly to changing market conditions while maintaining service levels and controlling costs.

We’d be interested in your views too. EMAIL Managing Director, Andrew Smith

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Sterling strengthens against the US dollar; what it means for importers and exporters

Aug 5, 2026 | , , , , , , , , , , , , , ,

The pound has been strengthening against the US dollar, improving sterling buying power for many UK businesses purchasing goods and services priced in dollars.

For importers, that's welcome news. A stronger pound can reduce the sterling cost of overseas purchases, international freight, fuel and other dollar-linked expenses. However, exchange rates are only one part of the equation.

The recent rise in GBP/USD has been driven largely by a weaker US dollar rather than a dramatic improvement in the UK economy.

Several factors have combined to support sterling:

Markets expect US interest rates to fall

Investors increasingly believe the US Federal Reserve could begin cutting interest rates sooner than previously expected as economic growth moderates.

Lower interest rates generally make the dollar less attractive to investors, reducing demand for the currency.

The Bank of England remains more cautious

Although UK growth remains subdued, inflation—particularly in wages and services—continues to influence Bank of England policy.

With UK interest rates expected to remain higher for longer than US rates, sterling has become relatively more attractive.

Investors are taking less defensive positions

During periods of global uncertainty, investors typically move money into the US dollar because it is viewed as a safe-haven currency.

As market sentiment has improved, some of that demand has eased, allowing sterling to recover.

The UK economy has proved more resilient than expected

Economic growth remains modest, but the UK has avoided some of the more severe downturns previously anticipated.

That has helped maintain confidence in sterling despite ongoing economic challenges.

Yet, the pound could weaken again

Foreign exchange markets can move quickly and remain highly sensitive to:

  • US employment figures
  • Inflation data
  • Federal Reserve and Bank of England announcements
  • Geopolitical events
  • Changes in investor confidence

Exchange rates can reverse rapidly as market expectations change.

What this means for your business

For companies involved in international trade, a stronger pound creates opportunities, but also some important considerations.

Purchasing goods in US dollars

If your suppliers invoice in US dollars, sterling now buys more dollars than it did only a few weeks ago.

This can reduce the cost of imported products, raw materials and overseas services.

However, savings may not appear immediately if:

  • purchases are already hedged
  • contracts are fixed at earlier exchange rates
  • suppliers review prices only periodically

Freight and fuel costs

Many international transport costs are linked directly or indirectly to the US dollar.

These include:

  • ocean freight
  • air freight
  • bunker fuel
  • aviation fuel
  • fuel surcharges
  • equipment charges

A stronger pound can reduce these costs in sterling terms.

However, exchange-rate gains can easily be offset by rising oil prices, emergency carrier surcharges or changes in freight market capacity.

Export revenues

Businesses selling into dollar markets face the opposite effect.

Each dollar of revenue converts into fewer pounds when sterling strengthens, potentially reducing margins unless prices are adjusted or currency exposure is managed.

Budgeting and pricing

Periods of exchange-rate movement are a good opportunity to review:

  • customer pricing
  • freight assumptions
  • tender calculations
  • landed-cost models
  • cost recovery mechanisms

Rather than relying on a single exchange-rate assumption, businesses should consider a range of scenarios when preparing longer-term quotations or contracts.

Practical steps to consider

Businesses with significant US dollar exposure should consider:

  • Reviewing how much of their purchasing and sales activity is linked to the US dollar.
  • Checking whether pricing mechanisms reflect current exchange-rate movements.
  • Understanding whether freight costs are based on spot exchange rates, fixed pricing or published conversion indices.
  • Considering hedging or fixed-rate arrangements where currency exposure is significant and predictable.
  • Regularly updating budgets and tenders to reflect changing market conditions rather than relying on outdated assumptions.

Understanding how changing exchange rates could affect your freight costs or supply chain. Metro's finance experts can help you assess the wider logistics impact and identify opportunities to improve cost control across your international shipments.

EMAIL Laurence Burford, Chief Financial Officer.

Hormuz satellite

Middle East conflict is reshaping global shipping once again

Jul 22, 2026 | , , , , , , , , , , , , ,

Commercial shipping in the Strait of Hormuz and Red Sea is facing renewed disruption with 14 Iranian attacks on vessels since June 25th, the breakdown of the US-Iran ceasefire and a Houthi threat to target Saudi-linked shipping in the Bab al-Mandab.

The tanker Kavomaleas, initially reported on fire in the Strait of Hormuz, has since been confirmed as the target of an attack on Monday. Its crew abandoned the vessel, which remained adrift and on fire. UK Maritime Trade Operations also reported that another tanker in the Strait’s southern transit corridor had been attacked and set alight, with its crew also abandoning ship.

These incidents have further weakened confidence in the safety of the Strait, which has historically carried around one fifth of the world’s crude oil and liquefied natural gas.

Traffic has fallen sharply during the latest period of escalation, with only six vessels crossing the Strait in a day, the lowest level in five weeks, while hundreds remained at anchor outside the waterway.

For shippers, the concern extends well beyond regional security. Rising fuel costs, higher insurance premiums, longer voyage times and reduced network capacity all have the potential to increase transport costs and reduce schedule reliability across global supply chains.

Hormuz remains the world's most important energy chokepoint

The attacks on Kavomaleas and a second tanker follows earlier incidents in July involving three vessels, including a Qatari-flagged LNG carrier.

Iran subsequently accused vessels of transiting without its permission, using its interpretation of the MoU agreement to assert control over passage through the Strait.

While the United States insists the waterway remains open to commercial traffic and has deployed a naval blockade, Iran's Islamic Revolutionary Guard Corps (IRGC) threat to execute attacks on unauthorised vessels cannot be ignored.

The impact extends far beyond the Gulf itself. Because such a significant proportion of the world's crude oil and LNG exports move through Hormuz, even relatively limited disruption can trigger sharp movements in energy markets as traders price in the risk of prolonged restrictions.

Brent crude briefly climbed above US$90 per barrel following the latest escalation, increasing expectations of higher bunker costs and transport surcharges across both ocean and air freight markets.

Red Sea uncertainty threatens container shipping

While Hormuz is primarily an energy concern, the Red Sea remains critical to global container shipping.

Recent threats to Saudi-linked shipping in the Bab al-Mandab Strait have renewed concerns that carriers may once again reduce Red Sea transits or suspend recently restored Suez services.

Maersk recently returned its Gemini AE15 service to the Suez route and planned to add Jeddah from August. Its MECL service also calls at the port.

CMA CGM operates several Asia-Europe services through Suez. Recent schedules show some Jeddah calls omitted on the MEX and BEX2 services, although not all calls have been removed.

Should security risks increase again, those services could once more be rerouted around southern Africa.

Such diversions add thousands of nautical miles to Asia-Europe voyages, increasing fuel consumption, extending transit times and reducing the effective capacity of the global container fleet. Even though no vessels are removed from service, longer round voyages mean fewer sailings can be completed each year, tightening capacity and placing upward pressure on freight rates.

Marine insurance remains available for vessels transiting the Gulf, but at substantially higher prices.

War risk hull premiums reportedly stood at a fraction of 1% of insured vessel value before the crisis began in February. They have since risen to between 3% and 10%.

For a tanker valued at US$100 million, this could increase the premium for a single transit from around US$250,000 to as much as US$10 million.

The Lloyd’s Market Association has stated that the decline in traffic is not primarily the result of insurance being unavailable. It said owners are choosing not to transit because of safety concerns.

These costs ultimately feed through to supply chains via emergency surcharges, bunker adjustment factors and higher freight rates.

Although neither the Strait of Hormuz nor the Red Sea is theoretically closed, commercial conditions remain highly fluid.

Container carriers continue to review sailing schedules, tanker operators are assessing voyage risks on a daily basis and insurance markets remain volatile. Further attacks or additional security measures could quickly alter routing decisions across both regions.

Visibility turns uncertainty into control

Geopolitical events cannot be prevented, but their impact can be managed with real-time visibility and timely data.

Metro combines global freight expertise with advanced digital visibility through our MVT platform, providing customers with real-time shipment tracking down to SKU level across all transport modes. Metro helps businesses identify disruption early, make informed decisions and keep products flowing through increasingly complex global supply chains.

To learn how Metro can strengthen the resilience and visibility of your international supply chain, EMAIL Managing Director Andrew Smith today.

LHR terminal 5

Air freight markets under pressure as capacity struggles to recover

Jul 22, 2026 | , , , , , , , , , , , ,

Global air freight markets continue to outperform expectations, but the balance between supply and demand remains fragile. 

What began as a short-term disruption following renewed conflict in the Middle East has evolved into a more structural capacity challenge, keeping rates elevated and limiting available space on key trade lanes.

Although airlines have adapted their networks and capacity is gradually returning, the market has yet to recover the capacity lost earlier this year. At the same time, resilient demand, particularly from the technology sector, continues to absorb available space, leaving shippers facing higher transport costs and reduced flexibility. 

Middle East disruption continues to shape the market

The collapse of the ceasefire between the United States and Iran has extended disruption across international air cargo networks well beyond initial expectations.

Several major international airlines have postponed the planned resumption of passenger and freighter services to the Gulf until at least late October, delaying the return of valuable belly-hold and freighter capacity that traditionally supports Asia-Europe cargo flows.

Before the conflict, around one-third of Asia-Europe air freight transited through Middle Eastern hubs. The loss of those services removed approximately 12% of global air cargo capacity almost overnight, forcing airlines to reroute shipments through alternative gateways and deploy additional direct freighter services wherever possible.

Despite these adjustments, capacity growth has lagged behind demand throughout 2026. Global air cargo demand increased by around 4% during the first half of the year, while available capacity expanded by only around 1%, creating the imbalance that continues to support elevated freight rates.

As a result, industry forecasts have changed significantly. Expectations that freight rates would fall during 2026 have been replaced by forecasts of annual increases up to 15%, reflecting the ongoing supply constraints affecting the market.

Demand remains resilient as market dynamics evolve

While geopolitical disruption has constrained capacity, changing demand patterns are also reshaping global air freight.

The rapid growth of artificial intelligence infrastructure is generating exceptional demand for semiconductor and data centre equipment, particularly on Transpacific services. Global semiconductor sales more than doubled year on year during the spring, creating sustained demand for premium air freight capacity.

Although AI-related shipments still represent a relatively small proportion of total air cargo volumes, they are highly concentrated on key trade lanes and typically require fast, reliable transport, placing additional pressure on available freighter capacity.

By contrast, the extraordinary growth in cross-border e-commerce that has supported air freight markets in recent years is beginning to moderate.

Changes to low-value import rules in both the United States and the European Union have reduced demand for some e-commerce shipments, with exports of low-value goods from China continuing to decline. While this has eased pressure on certain trade lanes, the reduction has been more than offset by continued strength in industrial manufacturing, technology exports and higher-value cargo.

Airlines continue to compete for scarce freighter capacity

The industry's ability to respond to changing demand remains constrained by a shortage of dedicated freighter aircraft.

Delays to new passenger aircraft deliveries continue to limit passenger-to-freighter conversion programmes, restricting the supply of additional cargo aircraft entering the market. As a result, airlines are increasingly competing not only for freight but also for access to aircraft.

Rather than expanding fleets rapidly, many operators are pursuing partnerships, aircraft acquisitions and strategic investments to secure long-term capacity. Others are repositioning aircraft between markets as demand changes, with freighter deployment shifting rapidly between Asia, Europe and the Americas in response to geopolitical events, humanitarian operations and changing trade flows.

This lack of spare capacity means the market remains particularly vulnerable to further disruption. Any significant geopolitical event, weather-related disruption or operational shock has the potential to tighten capacity quickly and place renewed upward pressure on rates.

Planning ahead remains the best strategy

Although capacity is expected to improve gradually during the second half of the year, market conditions remain unpredictable.

For shippers moving time-critical or high-value cargo, securing capacity early, maintaining flexible transport options and working closely with dependable logistics partners will remain essential. Businesses that rely on just-in-time supply chains or seasonal inventory should continue to allow additional planning time while airlines rebuild network resilience.

The market has demonstrated remarkable resilience throughout 2026, but it also highlights how quickly global air freight can be reshaped by geopolitical events, changing technology demand and structural capacity constraints.

Keeping your supply chain moving

When capacity is tight, reliability, experience, network strength and proactive planning make the difference.

Metro works with leading airlines and global carrier partners to secure stable air freight capacity across key international trade lanes. Our experienced teams provide tailored routing solutions, customs expertise and end-to-end shipment management, helping customers minimise disruption and keep critical cargo moving, even in challenging market conditions.

To discuss how Metro can strengthen your global air freight strategy and support your international supply chain, EMAIL Managing Director Andrew Smith today.

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