Supply chain attacks see Maersk suspend Red Sea routes

Maersk, MSC, CMA CGM, HMM & OOCL among liners to suspend Red Sea routes in face of attacks on commercial vessels, as US announces military task force

Leading liner companies – including Maersk, MSC, CMA CGM, HMM, and OOCL – have suspended trading via their Red Sea routes in the face of escalating attacks on merchant vessels in the region. 

An estimated 15% of the world's shipping traffic transits via the Red Sea en route to the Suez Canal, and is by far the shortest shipping route between Europe and Asia.

The journey from Rotterdam to Singapore via Suez is 8,400 nautical miles. Via the Cape, it’s 3,280 nautical miles longer, an increase of almost 40%.

Maritime experts say this will impact up to 1.7 million TEU of goods. (TEU stands for ‘twenty-foot equivalent unit’, and is a unit of cargo capacity used for container ships.) For an idea of the scale of the likely disruption, this is on a par with that seen during the Suez blockage in 2021.

In response to the mounting crisis the US is set to announce the launch of an expanded maritime protection force involving Arab states to combat the Houthi attacks coming from Yemen’s ports on commercial shipping in the Red Sea.

This decision is in response to a series of targeted attacks from the Houthi movement, a Shia Islamist political and military organisation. Houthis are targeting commercial ships in the Red Sea in response to Israel’s war on Gaza, in a bid to pressure the international community to address the conflict between Israel and Hamas.

Maersk and Hapaq Lloyd suspend Red Sea routes

Recently the cargo ship Maersk Gibraltar was targeted by a missile off the coast of Yemen, while Hapag-Lloyd’s containership Al Jasrah was also attacked while sailing close to the coast of Yemen.

The German containership owner and operator Hapag-Lloyd has said it is pausing all container ship traffic through the Red Sea, and that it will reroute ships via the Cape of Good Hope.

Meanwhile, Maersk has instructed all its vessels bound for the Red Sea to pause their journeys until further notice.

“This will be done until passage through the Suez Canal and the Red Sea is safe again for vessels and their crews,” a company spokesperson said, adding: “The recent attacks on commercial vessels in the Bab al-Mandab Strait are alarming and pose a significant threat to the safety & lives of seafarers. 

“This issue cannot be addressed by the global shipping industry alone, and we urge the international society to come together to find a swift resolution to bring the situation under control.”

Moody's, meanwhile, says the Red Sea situation means the global business world must brace itself for global disruptions to supply chains 

Daniel Harlid, a Senior Credit Officer at Moody’s, says: “This suspension affects over 50% of the weekly container shipping capacity on the Far East-Europe route, forcing a diversion around the Cape of Good Hope and adding about 10 days to journeys.”

“This situation, if it extends beyond a few days, will have implications for both the container shipping industry and for tanker and dry bulk markets, and also raises the risk of further disruption to supply chains.”

The journey from Rotterdam to Singapore via Suez is 8,400 nautical miles. Via the Cape, it’s 3,280 nautical miles longer, an increase of almost 40%.



Featured Articles

EU Supply Chain Law: Key Supply Chain Consulting Firms

The EU Supply Chain Law, also known as the Corporate Sustainability Due Diligence Directive (CSDDD), is set to hold companies' supply chains to account

The Categories – Part 3: Procurement & Supply Chain Awards

Mark your calendars for the debut of The Global Procurement & Supply Chain Awards 2024 at Procurement & Supply Chain LIVE London on 24 September 2024

Meet our Sponsors: Procurement & Supply Chain LIVE New York

ProcessUnity, ServiceNow, and Beroe are sponsoring Procurement & Supply Chain LIVE New York, due to take place on 5-6 June 2024

The Categories – Part 2: Procurement & Supply Chain Awards

Digital Supply Chain

Top 100 Women 2024: Sheri Hinish, EY – No. 3

Digital Supply Chain

Top 100 Women 2024: Gretchen McCarthy, Target – No.2