Important Advisory: Ocean Carriers Divert Vessels from The Red Sea

Posted on Dec 20

Article by: Rick Walker, Vice President, TradeInsights, LCB/CCS

As a result of the escalating security situation in the Red Sea, and concerns about the safety of the crew, vessels, and customer cargo has prompted at least ten major shipping lines to suspend Red Sea voyages until further notice. Danish shipping giant Maersk, the world’s second-largest container shipping line, has announced the rerouting of all vessels previously paused and due to sail through the region. Instead of navigating through the Red Sea, these vessels will now take a detour around Africa via the Cape of Good Hope. Other carriers such as MSC and Hapag Lloyd have made similar decisions to bypass the Red Sea.

The decision by Maersk comes in the wake of the United States’ announcement of “Operation Prosperity Guardian,” a 10-nation naval coalition aimed at addressing the growing threats to international shipping posed by Houthi forces in the Southern Red Sea, Bab-el-Mandeb, and Gulf of Aden. Denmark is not part of the coalition despite its participation in Combined Maritime Forces (CMF), a 39-nation partnership. Operation Prosperity Guardian falls under the umbrella of CMF and, more specifically, its Combined Task Force 153, which specifically focuses on security matters in the Red Sea.

According to the Journal of Commerce, “Maersk expects it will take a few weeks for the naval force to restore safe passage, CEO Vincent Clerc told CNBC, adding that the announcement was “reassuring.” Unlike the six-day disruption caused by the March 2021 grounding of the Ever Given in the Suez, the current problem won’t be solved in several days, he said. “It looks like it going to take a bit longer,” Clerc said. “What has been especially shocking in the last few days is the randomness of these attacks. There is absolutely no way for us to understand why certain ships have been targeted there [but] it puts the entire fleet into play.” Maersk, in a separate statement Tuesday, said it has “faith” in a solution meant to restore order in the region, but will avoid the Red Sea until that happens. “As such, getting vessels moving via the Cape of Good Hope will ultimately be a faster and more predictable outcome for customers and their supply chains,” the carrier said.

The Red Sea is crucial for the Asia-Europe trade lanes and the current developments pose numerous logistical challenges. The wider impact on international shipping is still unclear as the situation is evolving rapidly.

So far in 2023, there have been over 24,000 transits through the Suez Canal with bulk carriers accounting for 28% of the total, followed by oil tankers at 24% and containerships at 23%.
Diversions to avoid the Red Sea typically involve significant additional distances. Travelling from Asia to North Europe for example via the Cape of Good Hope instead of via the Suez Canal adds an extra 3,200 miles to the voyage (or 30%), extending typical containership voyage times from 31 days to 40 days at standard operating speeds.

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