Among the world's largest arteries, the Suez Canal's shipping route has recently encountered unprecedented challenges. Red Sea shipping has been attacked amid geopolitical tensions that have hit the Black Sea shipping lanes and severe droughts caused by climate change have disrupted Panama Canal shipping, forcing ships to avoid the Suez Canal.
This series of events, like dominoes, fell one after another, bringing unprecedented challenges to the world.
The Suez Canal's commercial flow has plummeted by 42% compared to its peak, impacting not only the world's most efficient but also the lives of millions of people in all regions.
Major shipping companies have suspended the use of the Suez Canal, resulting in a 67% reduction in weekly container vessel traffic, as well as a sharp decline in container cargo volumes, oil tankers and gas carriers.
To make matters worse, spot container freight rates have increased significantly since November 2023 as merchant ships have chosen to detour the Cape of Good Hope.
According to the report, average shipping rates in the last week of December last year recorded the highest weekly increase of $500, and the increase continues. On average, spot shipping rates for containers departing from Shanghai are more than doubled, and shipping to Europe is more than doubled.
The crisis could also have a profound impact on the global economy, threatening the global ** chain, leading to delivery delays, increased costs and inflation.
Within a year, these effects will be passed on to consumers. In addition, soaring energy and global food are likely to rise due to longer shipping distances and higher freight rates, impacting the interests of consumers and producers.
Against this backdrop, there is a need for global solidarity to work together to find sustainable solutions, especially to support countries that are more vulnerable to shocks. At the same time, the global shipping industry also needs to quickly adjust and strengthen international cooperation to cope with the rapid changes in the global landscape.