Global Trade and Compliance: Duty Shock, Border Risk, and the New Cost-to-Serve

You built your spring 2026 freight plans on a set of rules that no longer exist.

The Supreme Court killed IEEPA tariffs on February 20. Before anyone could update a single duty rate, a Section 122 surcharge dropped in its place. The same week, Mexico’s top cartel boss got taken out, retaliation locked down transit corridors overnight, and a $32.5 million BIS settlement reminded the entire export community that ignorance has a price tag.

And that’s just the appetizer.

No matter what you’re moving, or where in the world you’re moving it, we put this global trade and compliance update together so you can stop piecing it together yourself. 

What changed, what it costs you, and exactly what to prioritize over the next 7, 30, and 90 days. 

What Replaced IEEPA Tariffs, What You’re Actually Paying, and What to Do About It

So the Supreme Court killed IEEPA tariffs on February 20. Good news, right? Sure, until the replacement landed before most finished reading the opinion.

A Section 122 surcharge took effect February 24 at 12:01 a.m. EST. CBP moved fast on the back end. All IEEPA Fentanyl, country-specific, and Reciprocal HTSUS codes now show “EXPIRED.” And the new Section 122 codes are live: 9903.03.01 along with exclusions 9903.03.02 through 9903.03.11, running through July 23, 2026.

But here’s the part worth reading twice. The president said the rate would jump to 15%. CBP’s system still says 10%. That increase hasn’t actually hit. So your duty rate today is probably lower than what the weekend headlines told you. 

Be sure to also keep CSMS 67844987 close, and note that Section 232 and 301 China duties didn’t go anywhere.

Why Mallory Customers Should Care

A 5% swing between 10% and 15% sounds small until you run it across a full container of lumber, paper, or consumer goods. That gap can gut a margin you already quoted to a buyer. Carve-outs for USMCA-qualifying goods, critical minerals, pharmaceuticals, and select electronics mean some of you dodge the surcharge entirely while competitors eat it. Plus, if you paid IEEPA duties over the past few months, refund recovery just became a working capital project your finance team needs to own. 

Your Game Plan: Three Windows to Act

• Next 48 Hours (Lock Down Your Numbers): Freeze every assumed duty rate in your pricing tools. Pull a full import ledger and flag any entries with IEEPA duty lines. Make sure someone on your team is monitoring CBP system messages daily.
• Next 7 Days (Find Your Exemptions): Rerun HTS classifications and USMCA eligibility checks. Build a goods-in-transit list for shipments loaded before February 24. Enroll in ACH with CBP if you haven’t already, because that’s how refunds move now.
• Next 30 to 90 Days (Build the Muscle): Add tariff-change repricing clauses to customer contracts. Renegotiate terms with suppliers where duty responsibility can move. Run weekly duty and rule checks, not quarterly practices.

One Cartel Boss Down, Unpredictable Mexico Freight To Go

Tariff math wasn’t the only thing that blew up last week.

Mexican forces killed Nemesio “El Mencho” Oseguera Cervantes, head of CJNG and the most wanted cartel boss in the Western Hemisphere, with a $15 million bounty on his head. 

Within hours, retaliation rolled across multiple states: armed attacks, vehicle fires, and road blockades. Plus, trucks were set on fire, airports were shut down, and the Mexico-Puebla highway went from moving freight to moving nothing before sunset.  

Nobody got a warning. Nobody got a workaround. Loads just stopped.

Why Mallory Customers Should Care

You can model a tariff change over coffee. You cannot model a corridor shutting down because the cartel got mad and decided to make a point. That’s what makes this different from the duty rate whipsaw above. When drivers refuse routes and fleets pull back from hotspots, capacity doesn’t “tighten.” It vanishes. Rates spike, dwell times balloon at secure yards, and if you’re running high-value freight like electronics, medical devices, or consumer goods through those corridors, theft exposure climbs alongside the delays. The two problems feed each other at the same time, and they both land on your P&L.

Your Game Plan: Three Windows to Act

• Next 72 Hours (Get Your Carriers on the Phone): Ask point-blank if this is still an ongoing issue, which corridors they’ve paused, and what would trigger a full stop on your lanes. Tighten pickup verification and lock appointment windows at every origin point.
• Next Two Weeks (Stop Treating All Freight the Same): High-value SKUs need different security standards than low-risk commodity loads. Break them apart now, line up alternate crossings and staging options, and give yourself room to reroute without rebuilding from scratch.
• Next 60 to 90 Days (Write the Playbook Before You Need It): Bake a security addendum into your cross-border SOPs covering sealed trailers, geofenced stops, vetted yards, and clear escalation rules. Match your insurance to your real routing, because “hot zone” surcharges are a matter of when, not if.

Your $800 Free Pass Is Gone, and Every Small Shipment Now Needs Paperwork

The same February 20 executive order that launched the Section 122 surcharge also killed what was left of de minimis duty-free treatment.

The short version: shipments that used to slide through under the $800 threshold now need a formal entry filing in ACE. Full classification, full documentation, full customs treatment. 

For postal shipments specifically, CBP will assess duties tied to the new Section 122 surcharge rate until either that surcharge expires or a dedicated postal-entry process goes live.  

Why Mallory Customers Should Care

Every shipper has flows they never think about. The spare parts trickling in from a contract manufacturer. Sample runs ahead of a product launch. Low-value DTC parcels. Intercompany transfers between facilities. All of those moved for years under de minimis without a broker, without classification, without anyone blinking. Now each one needs an HTS code, a declared value, and a proper commercial invoice. Miss any of those details and your returns get stuck, your replacements sit at the dock, and someone on your team gets a surprise duty bill they never budgeted for.  

Your Game Plan: Three Windows to Act

• Right Now (Find Every Flow You Forgot About): Map out every shipment type that relied on de minimis: samples, replacement parts, small parcels, and intercompany moves. Standardize commercial invoices with accurate values, clear descriptions, and the country of origin on every single one.
• Next 30 Days (Set One Simple Rule): Nothing crosses a border without an HTS code, origin, and declared value attached. Decide which flows make sense to consolidate into fewer, larger shipments versus keeping parcelized with proper entry filing.
• Next 90 Days (Price It Into Your Business): Build de minimis removal into your cost-to-serve models, especially for high-SKU categories where small shipments were the norm. The free pass isn’t coming back. Your margins need to reflect that.

$32.5 Million Says “We Didn’t Know” Won’t Save You on Export Controls

Tariffs and cartel violence grab headlines. Export controls enforcement quietly ruins companies.

The Bureau of Industry and Security just settled with Applied Materials for $252.50 million over shipments to a restricted entity in China. The same week, the Department of Justice announced sentencing in a case where someone smuggled microelectronics to Russia through intermediary countries. 

Two cases, two different schemes, one loud message from BIS: they’re watching the supply chain end to end, and “we thought it was just a routine shipment” will cost you eight figures or a prison sentence.

Why Mallory Customers Should Care

You don’t have to be a semiconductor manufacturer to get caught up in this. If your products contain controlled subcomponents, if your freight routes through intermediary countries looking like diversion patterns, or if your customer’s customer sits on a restricted list, you’re exposed. BIS doesn’t care if you meant to ship a harmless box. They care about where it ended up and whether you did the work to find out before it left your dock. Electronics, components, test equipment, medical devices with dual-use capability, anything with an ECCN classification question mark sitting next to it deserves your attention.

Your Game Plan: Three Windows to Act

• Right Now (Stop Defaulting to EAR99): Tighten your screening on parties, end users, and end-use statements for anything remotely dual use. If you’ve been stamping EAR99 without documented support, that shortcut just became a liability.
• Next 30 Days (Train the People Who Touch Shipments First): Require written end-use statements for higher-risk destinations. Make sure customer service teams know the red flags, know who to escalate to, and have clear authority to stop a shipment cold.
• Next 90 Days (Audit Before BIS Does It for You): Pull your top 25 electronics and medical SKUs and validate classification plus licensing triggers on every one. Create a single export compliance checklist that rides with every booking, because the cheapest audit is the one you run on yourself.

More Routes Opening Up, More Sailings Getting Canceled: Pick Your Problem.

Export controls aren’t the only thing worth losing sleep over right now.

Maersk started pushing some sailings back through the Red Sea and Suez. Sure, shorter transit times and more routing flexibility sound like a win. But the fine print included a note from Maersk telling shippers to review their risk mitigation and insurance coverage. 

You don’t add that disclaimer when you feel good about the route (or state of geopolitics). 

On top of that, Drewry just counted 76 blank sailings. That’s an 11% cancellation rate with the World Container Index at $1,919 per forty-foot container. So the same carriers giving you faster options through riskier water are also pulling roughly one in nine sailings off the schedule entirely.

Why Mallory Customers Should Care

Cheaper rates and shorter routes sound great until a blank sailing wipes out your production timeline or a Suez routing change voids your cargo insurance. Every routing decision touches three things at once: transit time, risk exposure, and the delivery promise you made to your customer. Spot rates might soften through Q2, but reliability is a separate conversation. A $1,919 rate means nothing if your container is sitting on a dock because the sailing got canceled. Promo launches, seasonal inventory builds, raw materials for production lines: all of it depends on the boat showing up when the schedule says it will.

Your Game Plan: Three Windows to Act

• Right Now (Make Routing a Real Decision): Stop letting carriers default your routing. Document whether each lane prioritizes speed, cost, or risk, and if anyone moves your freight through higher-risk zones, get insurance confirmation in writing before the container loads.
• Next Two to Four Weeks (Protect Your Critical Freight): Build a buffer into cutoff dates for promo launches and production materials. Split bookings for must-arrive SKUs across two sailings or two carriers so one blank sailing doesn’t blow up your whole plan.
• Next 60 to 90 Days (Rebid on Reliability, Not Just Price): When you go back to market on ocean contracts, put service reliability language front and center. Build exception workflows that spell out exactly what happens when a sailing cancels or rolls, because it will.

Your Move, Spring 2026

The through line across every update in this piece is the same: policy, enforcement, and security aren’t background noise anymore. They’re operational variables that affect your costs, your timelines, and your ability to move goods. Treat them like headlines, and you’ll get caught off guard. Treat them like inputs, and you’ll plan faster than the volatility hits.

At Mallory Alexander, we can help you turn these updates into action. Routing options, documentation discipline, broker coordination, proactive exception management across ocean, air, and cross-border moves. Our team will work alongside yours to make sure global trade and compliance changes become part of your strategy.

Want a tailored game plan by lane and product category? Contact us, and we’ll map the next 90 days with you.