The double canal crisis jeopardizes the world before Christmas**.
The drought in Panama and the attack on ships near the Suez Canal threaten the ** chain during the festival.
Updated on December 11, 2023 at 13:19 Oliver Terring, Kristen Murray.
Hapag-Lloyd and its counterparts were forced to opt for longer, more costly routes. The German group announced that it will transfer at least 42 ships from Panama to Suez for use between Asia and the East Coast of the United States**.
The Panama Canal and the Suez Canal are two important passages in the world, and the simultaneous disruption of these two canals is threatening the global chain before Christmas.
Shipowners and importers warn of drought in the Panama Canal, as well as 1A series of attacks on cargo ships near the Suez Canal, 150,000 kilometres away, could restrict shipping ahead of the holiday season.
Marco Forgione, director general of the Institute of Export and International Trade, which represents British importers, said: "Some of them won't be in time for this Christmas. ”
After months of delays in the Panama Canal, consumer electronics such as iPhones "may not be readily available," and other importers are also finding it difficult to get Christmas decorations in time, Faucione said. He said it would be "catastrophic" if the attack near Suez involving Yemeni rebels worsened, coupled with Panamanian restrictions.
In the third quarter of this year, more than half of the container shipping planned to connect Asia and North America will pass through the Panama Canal or the Suez Canal, according to data from the ** analytical group MDS Transmodal.
According to the canal authorities, this October was the driest month in the Panama Canal region since at least 1950, in part due to the El Niño weather phenomenon that affects temperatures and rainfall across the globe. For the first time, the authorities have reduced the number of passing vessels, limiting them to 18 per day by February.
Rolf Habben Jansen, CEO of the German Hapag-Lloyd Group, said: "The drought in the Panama Canal is a matter of serious concern. "Hapag-Lloyd is the world's fifth-largest owner of container ships, transporting most of the world's manufactured goods.
* At least 167 ships passed through the Panama Canal in the first week of December this year, compared to 238 last year, according to data from analytical agency Marinetraffic. According to the Canal Authority, boats without reservations wait an average of 12It took 2 days to cross the 50-mile-long canal from the Pacific Ocean to the Atlantic, and some ships were stranded for more than two weeks.
Faced with increasing delays, Hapag-Lloyd and its peers are forced to opt for longer and more costly routes. The German group announced that it will transfer at least 42 ships from Panama to Suez for use between Asia and the East Coast of the United States**.
However, the sudden spate of attacks on ships by the Yemen-based Houthis has alarmed the global industry, even though the Houthis say they are targeting only ships linked to Israel.
How do they know who the ultimate owner is?A trader at a European shipowner and commodities company said, "They might think: 'This ship is going to Israel.'" So we'll give it a try. ’”
"The Panama Canal is practically closed," he added. If the same thing happens in Suez, how do you get grain to (the whole world)?That's when shipping starts to happen. ”
Hapag-Lloyd did not have any Israeli-linked vessels passing through the affected area, Haben Jensen said. But he added: "We are closely monitoring the situation and we will not hesitate to divert ships if needed." ”
"If it becomes more difficult to pass through the Suez Canal, it could cause serious chaos," he said. ”
An early indication of the rising cost of goods due to the disruption of the canal is that multiple shipowners have imposed surcharges of hundreds of dollars per container on exporters who ship goods through Panama, as the cost of using the canal has increased in a short period of time, with tolls running into millions of dollars per ship. Hapag-Lloyd also announced last week that it would impose a "war risk surcharge" of up to $80 on all cargo containers traveling to and from Israel.
MDS Transmodal said that if the route is changed from Panama to Suez, the voyage between New York and Shanghai will be increased by five days for ships sailing at a speed of 16 knots. If more shipowners avoid the Suez Canal and detour the Cape of Good Hope in Africa between the same cities, this could add 6 days to the voyage.
Faucione said the disruption highlighted a larger issue with global** resilience and suggested that alternative modes of transport, such as manufacturing** and air freight, should be considered.
And businesses need to pay attention to what a resilient chain is ......There's very little we can do this Christmas. But if we don't act, I think there is a risk of shortages throughout next year. ”