ALERTS & ​ADVISORIES

UPDATED Customer Advisory: Red Sea Attacks and Suez Canal Bypass

By
January 19, 2024
Container Ships at Port
Container Ships at Port

Current Situation: 

Five weeks into the crisis in the Red Sea, the situation continues to be critical and extremely dynamic. Given the situation has again worsened in recent days, various maritime research and consulting firms, as well as one global ocean carrier CEO, have communicated an outlook that carriers resuming Suez Canal transits seem more like months than weeks away until the risks of attacks are eliminated.

  • Every day this past week, media reported on attacks being carried out, with both the frequency of the attacks and ‘hit ratios’ increasing.
  • US forces attacked 14 locations in Yemen during a nighttime operation earlier this week, targeting the location of missile launchers. US officials acknowledged that airstrikes against Houthi militants in Yemen will not deter the group from attacks, yet it does not mean the military campaign will stop anytime soon.
  • Today, Maritime Unions urged TRANSCOM for enhanced communication in the Red Sea, pointing out that the severe attacks represent the biggest threat to commercial shipping in over 50 years. At the same time, they expressed gratitude for the support to date to safeguard ships and crew.

Key Facts & Market Developments: 

Below are some key facts and market developments because of the situation.

  • In the first two weeks of 2024, transits around the Cape of Good Hope have increased from 77 to 206. Reflecting an increase of 168%. With a few exceptions, all major containership ocean carriers are participating largely in this routing option. CMA-CGM is amongst those that transit, escorted by French warships.
  • The market spot rates featured in directly impacted East-West trades, as per the World Container Index, saw a weekly increase from Asia to North Europe of 12% and into the Med of 21%, respectively. While a smaller increase week over week, it is still significant. Backhaul rates to Asia have climbed 50%.
  • Global benchmarking and market intelligence platform Xeneta reported yesterday that some carriers make up for the longer transit time by omitting port calls at the start of round trips. Northern-most ports in Asia are affected by this, as services starting in Tianjin or Dalian, now seem to begin in Shanghai or Ningbo.

Going Forward: 

JAS Worldwide will continue to monitor the situation and keep you duly updated. Our public website will be updated once per week, every Friday. 

For any more detailed and/or shipment-specific information, please contact your local JAS office. 

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