Businesses and their supply chains continue to be impacted by global issues affecting sea freight.
Global trade, which relies on the shipment of goods from the Middle East and Asia, continues to feel the impact from as far back as COVID with escalating costs and lack of availability of containers and shipping vessels.
As trade started to recover, blockages in the Suez Canal, droughts in the Panama Canal and the devastating attacks on vessels travelling through the Red Sea led to moving major trading routes that took longer and cost more in fuel and time.
Today we continue to feel these impacts as shipping lines choose longer routes and struggle to meet sailing schedules.
Image: Jean-Paul Rodrigue, Texas A&M University-Galveston, and Lon Tweeten
12% of global trade passes through the Suez Canal and according to ONS data, there was a 66% traffic drop compared to a year earlier.
Major shipping firms, including Maersk are diverting their vessels to safer but much longer routes past the Cape of Good Hope in southern Africa adding up to 10 days and increasing fuel costs by 40%.
Every week there is more disruption with recent news of congestion at the port of Singapore causing further congestion in Malaysia as a knock-on effect of the Red Sea crisis. Singapore is the world’s second busiest port and handles more transshipments than any other.
The real impact on business
Research conducted by the British Chamber of Commerce in February 2024 found the Red Sea disruption had a major impact on UK export and trade.
- More than half (55%) of UK exporters say they have been impacted by disruption to shipping in the Red Sea.
- Over half (53%) of manufacturers and business-to-consumer service firms (such as retailers) also say they have been affected.
“We are seeing daily changes to vessel schedules, delays in transit and congestion at ports, which leads to delays in discharging containers from vessels and a continued increase in costs.
This makes it difficult for us to quote customers accurately AND hold those costs until the time of booking.
Our team are reminded daily of the necessity for our customers to forward plan and be prepared for delays and escalating charges.
Unfortunately we cannot control the escalating costs of our market place, but I work closely with our Aviate air freight team and Accelerate road and multi-modal team to find other solutions that help meet our customers supply chain needs.”
Jill Anstey, Navigate Manager
If you are moving goods by sea and need some expert advice, please get in touch as our team can talk you through the variety of options available to you.
