The Suez Canal Crisis - Assessing the Situation
The global trade is stuck in a big traffic jam and all hope lies a small dredger? Maybe this photo says it all. Since early Tuesday afternoon, March 23rd, the Suez Canal is blocked for any maritime traffic in both directions. What does this mean for the global flow of goods in ocean freight?
The reason for that is the container vessel Ever Given ran aground for still unknown reasons. Speculations are heavy winds, a sandstorm, or an electronic breakdown on the vessel. Unfortunately, until now all refloating attempts have failed. The blockage comes on top of the global supply chain disruption caused by COVID-19, the pandemic. This incident will put further pressure on global trade, and we can only hope that it will take days and not weeks.
So far, following effects are to be expected due to the blockage:
- Around 4-5 days delay can already be expected even if the problem will be solved now or over the weekend
- More than 230 vessels, not only container freighters, are affected and waiting to pass the Suez Canal. 50-60 vessels can only pass the Suez Canal per day which will cause further vessel delays until the backlog is cleared
- Nearly 30% of the world shipping container volume is moving daily through the 193km Suez Canal. Only the Far East to Europe trade represents ~370.000 TEU/week or ~50.000 TEU daily
- Every day the canal will remain blocked, causes a delay of ~50.000 TEU just on the Far East to Europe Trade but also the backhaul
- Heavy Port Congestion are to be expected in the European Ports in the coming weeks
- Empty equipment availability will worsen in Europe but also Asia and other parts of the world and rates will be rising as a matter of fact
- The first carriers are diverting their vessels around Africa’s Cape of Good Hope. The journey between Asia and Europe takes ~5-6 days longer
- First Carriers have announced booking stops on numerous routes related to the Suez Canal due to the uncertainty in the market
- Analysts expect losses for the world trade of 400m$ per hour
In case of any question, please contact your local customer service, your Hellmann Sales Representative, and/or our Sea Freight Management.
Track your Shipments
While the Suez Canal is still blocked, Hellmann Smart Ocean gives you a detailed status report of your shipments. Use our real-time tracking tool to get a consolidated view over all carriers and containers. Any open questions? Contact us at email@example.com.
(Pictures: Copyright Suez Canal Authority)