Suez Canal Blockage Will Have Unexpected Consequences
In a race against time, the cargo ship crisis that almost became a major global disaster, ended in victory this week. The Ever Given, the cargo ship at the center of this dilemma, was stuck at a crucial place in the Suez Canal that resulted in hundreds of ships unable to deliver their goods to Europe and Asia. But this victory still comes at a price; shipping analysts are projecting the traffic jam was holding up close to 10 billion in trade every day. Transporeon’s CEO Stephan Sieber spoke to Bloomberg about why this has been critical and what to expect now that the ship has been freed.
Sieber says, “I mean, it all goes back to the pandemic, which in essence means that many services have been cut down or less traveled is less gastronomy. People are not leaving homes anymore. And as a consequence, the consumption of goods at home is just increasing. And this leads to an increase in demand, mainly from goods from China and that sort of the whole situation out of its equilibrium, equilibrium. And I think as we approach summer. And as hopefully, you know, the pandemic will slowly but surely come to an end, you know, we do expect that a few months afterwards, the whole system will relax again.”
The shutdown has been affecting close to 15 percent of the world’s container shipping capacity according to Moody’s Investor Service, meaning more delays at ports around the world. Thankfully, so far, the impact has been small despite the major interruption, which can only be described as a terrible “oar-deal”.
*Bloomberg contributed to this content
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