Suez Canal: Hopes grounded ship will be refloated by Sunday
Shoei Kisen Kaisha, the Japanese owner of the container ship blocking the Suez Canal, says it aims to have the vessel refloated by Saturday evening, local time.
If successful, plans to dig around the ship and move it during high tide will unblock the shipping lane after five days of disruption to global supply chains.
Efforts to use tug boats to dislodge the Ever Given, a 400-metre long ship laden with goods travelling from China to the Netherlands, have proved unsuccessful. It ran aground and became lodged in both banks diagonally across the manmade strait on Tuesday, where it has remained since.
Instead authorities say they will now use mass dredging to remove 20,000 cubic metres of sand from around the ship, digging down to a depth of around 16 metres. This, they say, should allow the vessel to float freely and unclog the vital global trade artery.
Impact on supply chain
It is estimated that at least $9.5bn worth of goods have been delayed since the Ever Given ran aground on Tuesday. Reports suggest tankers and other freight vessels are now being diverted around the Cape of Good Hope - a journey that can add between 3000-5000 nautical miles depending on the destination - rather than wait for the situation to be resolved.
Navigation of the vital shipping lane was suspended yesterday. Admiral Osama Rabie, Chairman and Managing Director of the Suez Canal Authority (SCA) declared that no vessels would be permitted to pass through the canal “until the floatation works of the large Panamanian container vessel EVER GIVEN […] are complete”.
Analysts speculate that the container ship, which can carry 20,000 TEU, may be too firmly stuck for workers to shift without unloading at least some of its cargo.
Maersk, which has at least nine container vessels and two partner vessels directly affected by the situation, says the ramifications of the blockage and its impact on global supply chains “depends on how long the route remains impassable”.
“We are closely following the refloating operations and will do our upmost to mitigate the delay as best as we can,” it added in a statement.
Captain Rahul Khanna, Global Head of Marine Risk Consulting at Allianz Global Corporate & Specialty, says the blockage could compound a shortage of semiconductors that is already slowing production in the car and consumer technology sectors.
“Lloyd’s List has estimated that around $10bn of daily marine traffic could be halted by this blockage and it comes at a particularly bad time for global supply lines,” Khanna says. “Car and computer makers are straining from a global chip shortage, exacerbated by a fire in a big chip making factory in Japan.
“The canal is an important route to transport oil and liquefied natural gas from the Middle East to Europe and there is also the potential for delayed shipments to technology and automotive companies as well.”
DHL Claim Multi-Sector Collaboration Key to Fighting COVID
Since January, global logistics leader DHL has distributed more than 200 million doses of the COVID vaccine to 120+ countries around the globe. While the US and UK recently rolled out immunisation plans to most citizens, countries with less developed infrastructure still desperately need more doses. In the United Arab Emirates (UAE), which currently has one of the highest per-capita immunisation rates, the government set up storage facilities to cover domestic and international demand. But storage, as we’ve learned, is little help if you can’t transport the goods.
This is where logistics leaders such as DHL make their impact. The company built over 50 new partnerships, bilateral and multilateral, to collaborate with pharmaceutical and private sector firms. With more than 350 DHL centres pressed into service, the group operated 9,000+ flights to ship the vaccine where it needed to go.
With new pandemic knowledge, DHL just released its “Revisiting Pandemic Resilience” white paper, which examined the role of logistics and supply chain companies in handling COVID-19. As Thomas Ellman, Head of Clinical Trials Logistics at DHL, said: “The past one year has highlighted the importance of logistics and supply chain management to manage the pandemic, ensure business continuity and protect public health. It has also shown us that together we are stronger”.
Multisector partnerships, DHL said, enabled rapid, effective vaccine distribution. While international scientists developed a vaccine in record time—five times faster than any other vaccine in history—manufacturers ramped up production and logistics teams rolled out distribution three times faster than expected. When commercial routes faced backups, logistics operators worked with military officers to transport vaccines via helicopters and boats.
In the UAE, the public-private HOPE Consortium distributed billions of COVID-19 doses to its civilians as well as other countries in need by partnering with commercial organisations such as DHL. For the first time, apropo for an unprecedented pandemic, logistics companies made strong connections with public health and government.
“While the race against the virus continues, leveraging the power of such collaborations and data analytics will be key”, said Katja Busch, Chief Commercial Officer DHL and Head of DHL Customer Solutions & Innovation. “We need to remain prepared for high patient and vaccine volumes, maintain logistics infrastructure and capacity, while planning for seasonal fluctuations by providing a stable and well-equipped platform for the years to come”.
How Do We Sustain Immunisation?
By the end of 2021, experts estimate that we need approximately 10 billion doses of vaccines—many of which will be shipped to areas of the world, such as India, South Africa, and Brazil, that lack significant infrastructure. This is perhaps the greatest divide between countries that have rolled out successful immunisation programmes and those that have not. As Busch noted, “the UAE’s significant investments in creating robust air, sea, and land infrastructure facilitated logistics and vaccine distribution, helping us keep supply chains resilient”.
Neither is the novel coronavirus a one-time affair. If predictions hold, COVID will be similar to seasonal colds or the flu: here to stay. When fall comes around each year, governments will need to vaccinate the world as quickly as possible to ensure long-term immunisation against the virus. This time, logistics companies must be better prepared.
Yet global immunisation, year after year, is no small order. To keep reinfection rates low and slow the spread of COVID, governments will likely need 7-9 billion annual doses of the vaccine to meet that mark. And if DHL’s white paper is any judge of success, multi-sector supply chain partnerships will set the gold standard.