The cargo ship Ever Given is still jamming trade routes on the Suez Canal. The incident is known to have held around US $ 400 million per hour of goods that had to be shipped via this route.
Quoting CNBC, Friday (26/03/2021), the data was based on the estimated value of the goods to be moved through the Suez Canal. The data sender is Lloyd’s company. The company also assessed traffic to the west at about US $ 5.1 billion per day, and traffic to the east at around US $ 4.5 billion per day.
Jon Gold, Vice President of Supply Chain and Customs Policy, National Retail Federation, said the congestion of the Suez trade route is exacerbating the difficulty of delivering supply chains that are currently in crisis due to the COVID-19 pandemic.
“Many companies continue to struggle with supply chain bottlenecks and delays caused by the pandemic. There is no doubt that the Suez delays will affect supply chains and cause additional challenges.” he said.
The Suez Canal is the busiest route
The Suez Canal, which separates Africa from Asia, is one of the busiest trade routes in the world with about 12% of total global trade passing through it. Among other things, exports in the energy sector such as liquefied natural gas, crude oil and refined oil account for 5% to 10% of global shipments.
The rest of the traffic is mostly consumer products ranging from clothing, furniture, manufacturing, auto parts and sports equipment.
“The key to this problem depends on how long it will take to move Ever Given,” explains Alan Baer, president of logistics providers, OL USA LLC.
According to Baer, the Suez Canal has provided little help for global importers as it could help avoid massive congestion at US West Coast ports.
Another Option: Round the Horn of Africa
Baer, who has containers on board a ship stuck on the Suez Canal, said if the line remains closed, the ship will divert and go round the Horn of Africa, adding an additional seven to nine days of travel.
Mccording to the World Shipping Council if the canal closed for two days, it will require two additional days after the resumption to clear the backlog. The longer the delay, the longer it will take.
As well as delaying thousands of containers loading consumer goods, the stranded ships also tie up empty containers, which are key to Chinese exports. Then, this congestion will also have an impact on the arrival of US imports that fill US store shelves and manufacturing components.
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