The world’s largest integrated shipping company has warned that the Suez blockage has already triggered a series of further disruptions and the ramifications on shipping and the global supply chain may take months to unravel.
In a statement to its customers on Monday, Maersk said it had three vessels stuck in the Suez Canal and a further 29 waiting to enter. The company also said it had elected to reroute 15 vessels via the Cape of Good Hope in southern Africa, a longer and potentially more hazardous journey.
Maersk estimates that it will take six days for the current queue to make its way through the waterway, a factor that influenced its decision to reroute some of its vessels.
The statement warned that even when the Suez Canal is fully reopened, the “ripple effect on global supply” will be significant. “The blockage has already triggered a series of further disruptions and backlogs in global shipping that could take weeks, possibly months, to unravel.”
On Monday, as the skyscraper-sized ‘Ever Given’ container ship was partially refloated after blocking the Suez Canal for almost a week, Egyptian President Abdel Fattah Al-Sisi commended the work of his countrymen in freeing the ship from the banks of the canal. The ship’s partial refloating is likely to mean the waterway can reopen in the near future.
The canal hosts around 12% of global trade and 8% liquefied natural gas transport through it each day. On Saturday, the chairman of the Suez Canal Authority, Osama Rabie, said the state-run body was losing around $14 million to $15 million for every day that the canal was blocked. Moody’s financial intelligence service suggests that the canal contributed as much as 2% of Egypt’s GDP before the pandemic.
Data from shipping expert Lloyd’s List suggest as much as $9.6bn of goods have been held up each day by the ‘Ever Given’. The alternative route, around the Cape of Good Hope, adds as many as nine days to the journey of a vessel traveling from Taiwan to Rotterdam, as well as further security risks due to Africa’s west coast being heavily afflicted by piracy.
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