US Tariff Impact: Exporters Face Upto 15% Spike In Sea Freight, Scramble To Beat US Tariff Deadline

Freight rates to the US have seen a marginal 5–10% spike as Indian exporters rush to ship urgent orders ahead of the expected 50% tariff hike, according to Dushyant Mulani, Chairman of the Federation of Freight Forwarders’ Associations.

With sea shipments unable to beat the tariff deadline, given the 40–45 day transit time to the US, many exporters are switching to air freight for critical orders. "Only if an exporter opts for air freight can the cargo arrive in time by paying the 25% duty," said Ajay Sahai, Director General, Federation of Indian Export Organisations (FIEO).

Pharmaceuticals and electronics, which form a large part of India's export basket, have not yet been hit, offering some short-term relief. But exporters are concerned the disruption could persist. "The situation will remain dynamic for 6–12 months," Mulani said, adding that several sea and air ports are being closely monitored.

Pankaj Chadha, Chairman of the Engineering Export Promotion Council (EEPC), said freight costs to the US have already risen sharply in recent weeks. East Coast rates from India are now in the range of $2,400–$2,600, while West Coast rates stand at $2,100–$2,300. For instance, Mumbai–Savannah freight for a 20-foot container has climbed from $1,700 to $2,000, reflecting a $500 jump. Chadha noted that sea freight to the US has increased by around 15%, adding to exporters’ cost pressures as some race to ship goods before the higher 50% US tariff takes effect.

Exporters are now weighing alternate markets if the tariff issue prolongs. The government, meanwhile, is taking stock through diplomatic channels and is expected to announce long-term initiatives within a week. "The government is building up support for exporters," Mulani said.