China flag and ship

China’s New 2026 Supply Chain Laws: What You Need to Know

May 27, 2026 | , , , , , , , , , , , , , , ,

China is rewiring the legal framework around its ports and supply chains and that matters for every UK shipper moving goods to, from or via China. 

Two new sets of rules in 2026 change who controls disputes, how far you can probe your supply chain, and how China may respond to Western sanctions and due‑diligence demands.

Below we set out what’s changing and what Metro’s customers should be thinking about.

New maritime law puts China’s courts in the driving seat

From 1 May 2026, China’s revised Maritime Code gives Chinese law a much stronger role in contracts of carriage linked to Chinese ports. Where the port of loading or discharge is in China, Chinese courts can apply Chapter IV of the Code to carriage contracts even if the bill of lading or sea freight agreement points to English law.

Law firm HFW has called this a “substantive change”, noting that “chapter four of the Chinese Maritime Code will apply to a contract of carriage regardless of whether or not another law has been incorporated or chosen by the parties”. In effect, if governing‑law and jurisdiction clauses are unclear, Chinese courts now have more room to assert jurisdiction over disputes involving cargo moving through their ports.

Trading agreements often choose English law and London arbitration, while the carrier’s bill of lading may point a different way. The question is whether, in a dispute, a Chinese court will treat the bill of lading as the main contract and apply Chinese law, despite what the trade agreement says.

Some industry experts see this as part of a broader strategic move, to encourage a switch from FOB to CIF terms so that Chinese exporters control freight, insurance and crucially litigation on home turf.

However, any FOB to CIF shift is commercial, not legal, and Incoterms are an international standard which means that FOB remains fully available for China–UK trade, where the buyer wants to control the main–carriage contract and freight costs.

So, China’s legal changes don’t cancel FOB, and UK buyers can still insist on FOB terms and book their own freight, provided the contracts and practical behaviour match that intention.

Supply chain security rules: due diligence under pressure

Alongside the maritime reforms, China has introduced its first comprehensive Regulations on Industrial and Supply Chain Security, effective 31 March 2026. These rules treat supply chains as part of national security rather than a purely commercial matter, bringing them under the oversight of economic, security and cyber authorities.

The most sensitive provision for Western companies is Article 13, which restricts “information gathering activities” related to industrial and supply chains where these are found to breach Chinese law. The language is broad and undefined, creating uncertainty about whether standard due‑diligence activities, which can include supplier questionnaires, ESG audits, human‑rights assessments or on‑site inspections, could fall within the scope.

This sits uneasily alongside emerging Western rules such as the EU Corporate Sustainability Due Diligence Directive and US forced‑labour legislation, which expect companies to map supply chains and scrutinise suppliers in detail. Legal commentators warn that “the new law creates a direct and unresolved conflict between Chinese law and Western due diligence obligations”, with companies potentially facing legal risk in China for work they are required to do under EU or US law.

The regulations also give authorities wide powers to respond to perceived threats to supply‑chain stability. Investigations can target foreign organisations and individuals where there is a “risk or threat” of harm, not just proven damage, and can lead to restrictions on trade, investment and cooperation in China, along with travel or work limits for individuals.

Counter‑measures against foreign sanctions

A companion set of rules – the Regulations on Countering Foreign Improper/Unjustifiable Extraterritorial Jurisdiction, in force from early April – strengthens China’s ability to push back against foreign sanctions, export controls and data‑disclosure demands applied extraterritorially.

These sit alongside the Anti‑Foreign Sanctions Law, blocking rules and the “unreliable entities” regime, creating what one firm describes as an “integrated counter‑sanctions system”. Authorities can investigate and penalise organisations and individuals who implement or even “promote” foreign measures seen as discriminatory towards China, with tools ranging from import and export restrictions to asset seizures and visa bans.

This framework has emerged against a backdrop of heightened geopolitical tension, including Western tariffs and probes into China’s exports, secondary‑sanctions risks around Iran and disputes over strategic assets like the Panama Canal.

What shippers should do

None of this means that trading with China will suddenly stop or that every UK shipper is about to be investigated. But the risk environment has clearly changed, and it is worth taking some practical steps:

  • Check bills of lading, trade agreements and framework contracts to see where Chinese ports are involved, what law and jurisdiction are specified.
    Strengthen English‑law and arbitration provisions and clarify that higher‑tier agreements take precedence.
  • Talk to your insurers about how the revised Maritime Code might affect liability, claims handling and cover for China‑linked moves.
    Consider obtaining Chinese‑law input on key routes or contracts where your exposure is greatest.
  • Map which parts of your ESG and human‑rights due diligence involve Chinese suppliers or sites.
  • For higher‑risk work, such as auditing sensitive regions or investigations linked to sanctions, seek specialist advice on how to stay compliant with both Western obligations and Chinese restrictions.
  • Be mindful of public statements about “decoupling from China” or “boycotting” particular regions. These may be read as aligning with foreign measures and may increase regulatory attention in China.
  • Align messaging between compliance, procurement and communications so that necessary changes to your supply chain are framed around resilience, quality and legal compliance, not politics.

For Metro’s customers, the key takeaway is that China is now using law as an active tool of supply‑chain strategy. Understanding how these new rules work, and adjusting contracts, due‑diligence programmes and communication strategies accordingly, will help keep goods moving while managing a more complex risk landscape.

If you have questions or concerns about any of the developments outlined here EMAIL our Managing Director, Andrew Smith.

Suez empty

Suez return remains fragile as carriers weigh faster transit against overcapacity

May 13, 2026 | , , , ,

Although some shipping lines have begun selectively routing vessels back through the Suez Canal to reduce transit times and improve vessel utilisation, the industry remains far from a full-scale return to pre-crisis operating patterns.

Diversions around the Cape of Good Hope (COGH) have absorbed substantial global vessel capacity over the past two years by extending voyage times and reducing effective fleet availability. A broader return to Suez routing would rapidly reverse much of that dynamic, potentially releasing millions of TEU of effective capacity back into the market.

Routing via Suez shortens Asia–Europe voyages by more than 3,000 nautical miles compared with Cape routing, reducing transit times, improving vessel productivity and lowering fuel consumption, but the wider implications could be far more disruptive.

Faster transit times could rapidly shift supply and pricing dynamics

Industry estimates suggest that restoring normal Red Sea routings could release around 7% of effective fleet capacity back into the market. This would arrive at a time when container shipping is already facing heavy new-build vessel deliveries and relatively modest long-term demand growth.

The risk is that markets could move rapidly from relative tightness towards oversupply, placing renewed downward pressure on freight rates across major trades.

CMA CGM has increased the number of Suez Canal transits on two selected services, with shippers paying premium fees in exchange for faster transit times and reduced inventory delays.

Other carriers may be evaluating Red Sea routing strategies, although they remain cautious about large-scale network restructuring while regional security conditions remain unstable.

Importantly, any financial benefit from returning to Suez is still being offset by elevated war-risk insurance premiums and ongoing operational uncertainty linked to Houthi activity and wider instability across the Middle East.

Middle East instability continues to cloud long-term planning

Earlier expectations that container shipping could progressively return to normal Red Sea operations during 2026 have weakened significantly following renewed military escalation involving the US, Iran, Israel and regional proxy groups.

Several shipping lines that had previously explored limited Suez re-entry have since adopted a more cautious position, with some reversing earlier routing plans and returning services to COGH diversions.

At the same time, wider global trade patterns are also evolving in ways that partially offset oversupply concerns.

Chinese exporters are increasingly expanding into alternative markets including South America, Africa, the Indian subcontinent and the Middle East itself. These longer and more operationally complex trade flows consume additional vessel capacity and are helping absorb part of the substantial new tonnage entering the global fleet.

Even so, structural pressure continues to build beneath the surface.

Global trade growth is still expected to remain below the pace of new vessel deliveries scheduled between 2026 and 2028. Larger vessels are expected to feel the effects of oversupply first, particularly as cascading tonnage begins placing pressure on secondary and regional trades.

For shippers, the result is an increasingly uncertain operating environment where transit times, freight rates and network structures could change rapidly depending on how security conditions evolve across the Middle East.

While a full-scale return to Suez routing still appears unlikely in the near term, selective transits and gradual network adjustments are already beginning to reshape carrier strategies, pricing behaviour and capacity planning across major east-west trades.

Metro is working closely with customers to assess Suez and Cape of Good Hope routing trade-offs, comparing carrier strategies and identifying the ocean freight solutions most aligned to their supply chain priorities, inventory requirements and risk tolerance.

EMAIL Metro Managing Director Andrew Smith to learn how differing Suez and Cape routing strategies could affect your supply chain, and how Metro helps shippers balance transit times, security risk, insurance exposure, cost volatility and schedule reliability.

HKG port

Peak season uncertainty grows as shippers front-load inventory and freight demand diverges

May 13, 2026 | , , , , , , , , , , , , , , , ,

Container shipping markets appear to be entering an earlier and increasingly fragmented peak season, as geopolitical disruption, rising fuel costs and tighter carrier capacity management reshape freight demand across major trade lanes.

Bookings on several east-west corridors strengthened earlier than normal during May, with carriers maintaining upward pressure on rates as many importers accelerate shipments ahead of the traditional third-quarter peak season period.

Spot rates on Asia–US west coast services have continued to outperform other major trades, rising around 4% week on week and remaining significantly above levels seen before the escalation of Middle East disruption. Asia–Europe pricing has also strengthened modestly, with rates to North Europe and the Mediterranean increasing as carriers attempt to restore margins through capacity reductions and surcharge increases.

However, broader market conditions remain difficult to interpret. What appears to be an early peak season may ultimately reflect precautionary inventory positioning and front-loading activity rather than sustained end-user demand growth.

Front-loading and disruption are reshaping traditional shipping patterns

A growing number of importers are moving cargo earlier amid concerns that operational disruption, congestion and capacity shortages could intensify later in the year.

The continuing closure and instability surrounding the Strait of Hormuz is adding further pressure to global freight markets, with around 1.5% of global shipping capacity estimated to be affected directly by disruption linked to the region.

At the same time, higher oil prices are increasing carrier operating costs across both ocean and airfreight markets, while blank sailings are continuing to tighten effective capacity on key trades.

Capacity reductions on Asia–Europe services have become increasingly aggressive in recent weeks, with shipping lines reducing available space to North Europe and the Mediterranean while also introducing additional blank sailings beyond traditional holiday periods.

The result is a more volatile market where shipment rollovers, reduced allocations and short-notice schedule changes are becoming increasingly common, even where bookings are technically available.

On transpacific trades, carriers have also maintained relatively firm control over available capacity following post-Lunar New Year service adjustments, helping sustain pricing despite ongoing uncertainty around underlying consumer demand.

Additional surcharges introduced on Asia–US services suggest carriers expect demand to remain comparatively elevated through the summer period.

Many importers remain cautious about underlying demand, particularly in Europe where economic conditions remain comparatively weak and pressure on household spending continues to affect purchasing behaviour.

This creates the possibility that some businesses could be holding elevated inventory levels later in the year, potentially resulting in a delayed, compressed or weaker traditional peak season across certain sectors.

Metro survey highlights cautious but stable demand expectations

Early findings from Metro’s ongoing customer survey reflect this more balanced outlook.

Around 38% of respondents currently expect freight volumes to remain broadly stable over the next 12 months, while a similar percentage expect volumes to increase slightly. Less than 1/8 anticipate a significant decrease, while none expect a significant increase in activity.

The findings suggest that many businesses are not currently anticipating a dramatic peak season surge, but instead expect relatively stable trading conditions alongside continued disruption and cost pressure.

At the same time, respondents indicate that ongoing instability across global supply chains is continuing to influence inventory planning, shipping schedules and freight costs.

The divergence between Asia–US west coast and Asia–Europe markets highlights how uneven global freight conditions have become. Rather than moving in a single direction, pricing and demand are increasingly being shaped by regional economic performance, inventory strategies and trade lane-specific operational risks.

Sea–air solutions gaining attention as airfreight costs surge

The disruption is also influencing modal shift decisions.

With the average airfreight rate out of Asia-Pacific over 40% higher than last year shippers are increasingly exploring sea–air solutions to balance cost, speed and reliability.

Airfreight rates have risen sharply as fuel surcharges, restricted airspace and tighter capacity continue to affect global networks. At the same time, ongoing Red Sea diversions are keeping some ocean transit times above 50 days on Asia–Europe services.

For many retail, fashion, e-commerce and consumer goods shippers, sea–air services are becoming an increasingly valuable tactical solution where traditional airfreight costs are difficult to absorb but ocean transit times remain commercially challenging.

For shippers, the key challenge may now be timing. If front-loading activity continues through the early summer period, demand on some corridors could remain firmer for longer than normally expected. However, weaker consumer demand and elevated inventory levels could also limit the scale of any traditional late summer or autumn rebound.

Metro’s survey remains open, and businesses are encouraged to share their expectations and experiences, together with insights into current market conditions, operational pressures and changing supply chain requirements. The survey also provides an opportunity for customers to share feedback on Metro’s performance and highlight where additional support or solutions could help strengthen supply chain operations. 

GO TO THE 2 MINUTE SURVEY

Through proactive capacity planning, multimodal air, sea and sea-air routing options and contingency-focused supply chain support, Metro helps customers respond more effectively to disruption, changing demand patterns and ongoing peak season uncertainty. EMAIL Managing Director, Andrew Smith, to learn more.

Hormuz satellite

Middle East disruption continues as Metro scales contingency solutions

Apr 29, 2026 | , , , , , , , , ,

The extension of the US–Iran ceasefire has done little to stabilise operating conditions in the region, with last week’s seizure of two MSC-managed container vessels by Iran’s Islamic Revolutionary Guard Corps in the Strait of Hormuz. 

The incident highlight the ongoing risk to commercial shipping and reinforces the reality that access through Hormuz remains severely constrained, with container flows through the Strait largely suspended.

Land-bridge solutions under pressure as demand surges

As traditional shipping routes have been disrupted, supply chains have shifted rapidly towards alternative solutions, particularly land-bridge routes across the Gulf.

However, these corridors are now under significant strain. Demand for trucking capacity has surged well beyond available supply, with rates on key lanes such as Jeddah to the UAE rising four to five times above pre-conflict levels.

Jeddah has become the primary gateway following security concerns at Khor Fakkan and Salalah, concentrating volumes into a single entry point and creating further bottlenecks. In some cases, demand for road capacity has reached multiples of available supply, driving sharp price escalation and limiting flexibility for shippers.

Operational disruption now outweighs capacity availability

One of the defining characteristics of the current market is that disruption is being driven less by a lack of physical assets and more by how networks are operating.

Ocean carriers are navigating around both the Red Sea and Hormuz, adding 15–20% to voyage distances, increasing fuel consumption and reducing effective capacity. At the same time, global port congestion has exceeded 3 million TEU, further impacting reliability. 

Airfreight networks are also adjusting to restricted airspace and reduced Gulf capacity, while road freight is absorbing increased volumes through regional corridors, adding complexity and extending transit times.

The result is a market where capacity exists, but is harder to access, less predictable and more expensive to deploy.

Pricing volatility accelerates as fuel and disruption outpace contracts

Freight pricing is struggling to keep pace with the speed of change.

Across ocean freight, emergency bunker surcharges are now widely applied, while traditional fuel adjustment mechanisms lag behind real-time cost increases. In airfreight, fuel surcharges are being revised more frequently as jet fuel prices continue to rise. In road freight, fuels costs typically represent over 30% of operator costs, placing short-term pressure on carriers and increasing the likelihood of further cost pass-through. 

The situation is further complicated by simultaneous pressure across multiple global chokepoints.

Disruption linked to the Strait of Hormuz is occurring alongside continued Red Sea instability and wider geopolitical friction across key corridors. This has created a structurally higher-risk operating environment, where any escalation can quickly remove capacity, extend transit times and increase costs across all modes. 

Scaling solutions to maintain cargo flow

In response, Metro has significantly increased its operational focus on the region, with time dedicated to resolving Middle East-linked problems rising by more than 1000%.

The focus is on execution: ensuring cargo continues to move and that shipments already in transit are delivered using the most effective available solution.

Metro is actively supporting customers through:

  • Dynamic re-routing of in-transit cargo, avoiding disruption hotspots
  • Alternative gateway strategies, identifying viable entry points outside high-risk zones
  • Airfreight deployment, where speed and reliability are critical
  • Land-bridge and multimodal solutions, maintaining flow where ocean routes are constrained

This flexible, hands-on approach is essential in a market where conditions are changing rapidly and pre-planned routes are no longer sufficient.

If you have cargo moving to, from or through the Middle East, or shipments currently held en route, Metro can help you identify and implement the most effective resolutions.

EMAIL Managing Director, Andrew Smith, today to secure capacity, protect transit times and keep your supply chain moving in a rapidly changing environment.

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