Shippers on the Asia-Europe and Asia-US East Coast trades should expect months of supply chain disruption and capacity cuts even once the Suez Canal is reopened, carriers have warned. <\/p>\n
The cascading effects of re-routing of ships around Africa to Europe, and even through Panama to the US East Coast, to avoid the blocked Suez Canal will limit available shipping capacity and equipment at a time when demand for container shipping is high. <\/p>\n
\u201cCompanies should expect the Suez blockage to lead to a constriction in shipping capacity and equipment, and consequently, some deterioration in supply chain reliability issues over the coming months,\u201d Caroline Becquart, senior vice president and head of Asia and the 2M Alliance service network at Mediterranean Shipping Co. (MSC), said in an update Saturday. <\/p>\n
\u201cUnfortunately, even when the canal re-opens for the huge backlog of ships waiting at anchorage this will lead to a surge in arrivals at certain ports, and we may experience fresh congestion problems. We envisage the second quarter of 2021 being more disrupted than the first three months, and perhaps even more challenging than it was at the end of last year.\u201d <\/p>\n
Evergreen Marine Corp. said in a statement Saturday that efforts to clear sand and mud around the ship\u2019s bow would take \u201cat least two to three days\u201d before the required depth was reached to refloat the ship. <\/p>\n
MSC\u2019s 2M Alliance partner Maersk also warned the impact on the container supply chain would continue well beyond the physical removal of the vessel. \u201cFor every day the canal remains blocked, the ripple effects on global capacity and equipment continues to increase,\u201d Maersk said in a Saturday update. \u201cWe have already started to proactively manage our capacity and will not be accepting cargo where we cannot ensure space.\u201d <\/p>\n
Maersk said once the canal was reopened, shipping convoys would aim to run continuously, but with the backlog of vessels Saturday, the carrier expects it will take three to six days for all waiting ships to pass through the canal. <\/p>\n
The 2M carriers have 22 vessels waiting to enter the canal, with five expected to reach the Suez Saturday. <\/p>\n
Sea-Intelligence Maritime Analysis noted in its latest weekly newsletter that carriers re-routing ships around Africa or through Panama would absorb an amount of carrying capacity equal to 6 percent of the globally available container vessel capacity. The analyst said 6 percent of the global fleet was equal to 1.48 million TEU of capacity, or the equivalent of 74 ultra-large 20,000 TEU container vessels. <\/p>\n
\u201cIt is evident that such an amount of capacity absorption will have a global impact and lead to severe capacity shortages. It will impact all trade lanes, as carriers will seek to cascade vessels to locations where they have the greatest need,\u201d Sea-Intelligence wrote. Global supply chain stretched <\/p>\n The Suez disruption is hitting a container shipping system where all the buffer capacity and resilience has already been deployed in full to deal with the ripple effects from the pandemic. <\/p>\n \u201cThe market is under severe stress already, with all seaworthy container vessels already in deployment,\u201d Sea-Intelligence said, outlining a litany of already severe problems constraining the ocean trades and affecting schedule reliability. <\/p>\n \u201cCharter rates are hitting new highs every week and fixture lengths are increasing, as carriers are extremely eager to secure tonnage. The empty container shortage problem has not yet been solved. Port congestion remains a problem, not only in major US ports, but also across the world, hitting ports such as Singapore, Auckland in New Zealand, and Chittagong in Bangladesh.\u201d <\/p>\n Becquart shared a grim assessment of her own. \u201cThere\u2019s no doubt that the current Suez Canal blockage is going to result in one of the biggest disruptions to global trade in recent years, and we are working around the clock to manage our fleet and services so we can keep cargo moving and keep trade flowing as best we can under the circumstances,\u201d she said in the weekend MSC update. <\/p>\n To keep container flows moving, carriers are diverting greater numbers of ships around Africa or via the Panama Canal. The 2M Alliance has so far diverted 14 of their vessels, but Maersk said this number was expected to increase as salvors struggle to free the Ever Given. <\/p>\n \u201cWhile efforts to dislodge the Evergreen vessel from the Suez Canal continue, hundreds of ships are caught up in the traffic snarl in both directions,\u201d Maersk said. <\/p>\n CMA CGM said Saturday two of its vessels have been diverted around Africa, and for cargo not yet loaded, alternative maritime routes, rail services, or air freight solutions with CMA CGM Air Cargo were being considered. <\/p>\n Hapag-Lloyd said Friday its partners in THE Alliance \u2014 Yang Ming, Ocean Network Express (ONE), and HMM \u2014 are rerouting three Asia\u2013Europe vessels and three Asia\u2013US East Coast ships around Africa\u2019s Cape of Good Hope, a move that can add about 10 to 14 days to the trip for Europe-bound ships. <\/p>\n As ocean carriers reroute more vessels away from the canal, shippers will face further delays and higher costs, according to a report from Commodities at Sea, a sister product of JOC.com within IHS Markit. <\/p>\n \u201cEven a two days delay would further add to the supply chain disruption slowing the delivery of cargo to businesses across the UK and Europe,\u201d the report noted.<\/p>\n<\/p>\n Given that a routing around the Cape of Good Hope at the southern tip of Africa would add more than 3,000 nautical miles, ships would have to burn approximately 1,000 tons of additional fuel, equating to approximately $500,000, to increase speeds by two knots to maintain their weekly schedule, according to IHS Markit research.<\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":" Shippers on the Asia-Europe and Asia-US East Coast trades should expect months of supply chain disruption and capacity cuts even once the Suez Canal is reopened, carriers have warned. 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