International Shipping companies have redirected about $35 billion worth of cargo away from the Red Sea amid the risk of counter attacks from Yemen, CNBC reported this week.
According to the report, there are currently 57 container vessels sailing the long way around the southern tip of Africa instead of passing through the Red Sea and the Suez Canal.
That number will increase as more will take this routing, Paolo Montrone, senior vice president and global head of trade sea logistics at Kuehne+Nagel, told CNBC. The total container capacity of these vessels is 700,000 twenty-foot equivalent units.
According to senior consultant for MDS Transmodal Antonella Teodoro, the approximate value of those containers is $50,000, which adds up to $35 billion in total cargo being rerouted.
Carriers have been diverting vessels following travel suspensions over reports of at least two ships having been targeted with projectiles on Monday. Yemenii leaders said they were pursuing Israel and all Israel-bound vessels due to the ongoing hostilities in Gaza.
Ocean carriers could also start making adjustments to their networks in addition to the diversions. But, diversions/adjustments will require time and won’t come free, understandable. One can hope we won’t see the high rates seen in the recent past.
The situation is very volatile and the reconfiguration of these networks is very complex, so we can expect a certain level of disruption.
In Asia, the lack of empty equipment containers will become a potential issue as the repositioning of empty containers into demand areas will take 10-20 days longer.
Meanwhile, the CEO of Danish shipping group Maersk, which has also rerouted ships around Africa, expects two to four weeks of delays.
Europe is more dependent on the Suez, Vincent Clerc told CNBC, adding The delays will be more pronounced in Europe.
RT. com / ABC Flash Point News 2023.
Where are the US & Allies’s Warships, supposed to police the Red Sea? Tails between the legs.? Yemen are forcing the Western aggressive forces eat the humble pie. It looks like the US & Allies are playing chicken, the Japanese are also running scared, after declaring strong retaliations against the Houthi’s, so far silence and no Japanese warships in Red Sea.
Blocking the weapon supply shipments to Israel, good job Yemen!
HOUTHIS HAS TAUGHT THE WEST A VERY PRECIOUS LESSON.