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The impact of the situation in the Red Sea is expanding, leading to widespread disruptions across the industry. AsstrA, an international transport and logistics company, has prepared this report to provide you with an overview of the challenges currently impacting the market. This report is a cross-section of events that have influenced the situation in the industry.
Latest events
The British Navy reported an attack on a ship off the coast of the Yemeni port of Hudaydah (news from July 15).
https://www.brecorder.com/news/40312992/tanker-comes-under-attack-off-yemen
The Yemeni Ansar Allah movement (Houthis) attacked the Chrysalis tanker twice in the Red Sea and the Bab al-Mandeb Strait. This was stated on July 12 by the military representative of the radical organization, Yahya Saria. The Chrysalis was attacked twice, once in the Red Sea and again in the Bab al-Mandab Strait, using multiple ballistic and naval missiles and drones. According to the Marinetraffic service, the Greek-registered tanker Chrysalis, flying the flag of Liberia, is heading to the port of Sikka, located in India.
Earlier, on June 23, a merchant vessel flying the Liberian flag was struck by a Houthi drone attack while sailing in the Red Sea off the coast of Yemen's port city of Hodeidah.
Also on Sunday 23, the Houthis claimed attacks on two vessels sailing in the Red Sea and the Indian Ocean.
The Houthis began striking ships in the Red Sea and Gulf of Aden since November last year to protest Israeli actions in the Gaza Strip.
https://english.news.cn/20240713/13ead2df1daa4a75a4b53e46b38b4af1/c.html
https://english.news.cn/20240623/e0f6f812fbc5492dad3fed5f2227cd50/c.html
Maersk CEO Vincent Clerc believes that the coming months will be challenging for both carriers and businesses as the situation in the Red Sea stretches into the third quarter of 2024. Currently, Maersk ships continue to sail across Africa via the Cape of Good Hope in South Africa. Rising costs have become a serious problem for carriers. Due to lengthening freight transportation and reducing capacity, the price per container has increased significantly.
Simon Xu Head of China Container Division at AsstrA says that the situation in the Red Sea has indeed escalated as MSK, MSC and other three container ships were attacked again.
Currently, global port congestion has reached a new high, with 90% of container ships delayed. Meanwhile, factors such as tariff threats, port strikes and severe weather have intensified the uncertainty of global shipping. But there is a phenomenon worth noting, which is that freight rates have started to cool down after 13 consecutive weeks of increase, and it seems to be reaching a turning point.
The current situation and look ahead
Since approximately 30% of the world's container traffic typically passes through the Suez Canal, the shift to longer routes has severely disrupted global trade. For example, experts estimate that due to ships idling on long voyages, the available capacity of the entire industry was reduced by approximately 15-20% in the second quarter of 2024. The situation is also causing delays and congestion in key ports, including Singapore, Ningbo and Shanghai. Operational bottlenecks, vessel bunching, as well as equipment and capacity shortages are all leading to delays. The disruption is expected to continue into the second half of 2024.
Many large shipping companies have stopped transporting cargo through the Red Sea, refocusing on moving around Africa. Thus, four of the world's five largest container lines, CMA, CGM, MSC, Maersk and Hapag-Lloyd, have temporarily suspended delivery through the Suez Canal and continue to transport cargo bypassing the Cape of Good Hope.
https://www.maersk.com/news/articles/2024/06/12/navigating-challenges-in-red-sea-and-beyond
Author: Aneta Kowalczyk.
