Shipping costs mount as Suez Canal remains blocked by stranded vessel

Daniel Fowler
March 27, 2021

The Ever Given, owned by the Japanese firm Shoei Kisen KK, got wedged Tuesday in a single-lane stretch of the canal, about 6 kilometers (3.7 miles) north of the southern entrance, near the city of Suez.

Some ships now may be changing course to avoid using the Suez Canal.

"It just shows you how vulnerable our supply-chain lines are", said Guy Platten, secretary general for the United Kingdom -based International Chamber of Shipping.

The Suez Canal Authority said in a statement: "The 13 vessels were expected to continue their transit through the canal according to projections on the time of completion of the floatation works of the grounding vessel".

Yesterday, the three vessels behind MV Ever Given were assisted out of the Canal, bringing them back to Port Suez Anchorage.

"No LNG ship bound for Spain has been affected by the ship stuck in the Suez Canal, and there are no ships scheduled to come from countries that use this route in the next two weeks".

A third container ship was about to pass the Strait of Gibraltar "before turning around to travel around Africa on its journey towards Singapore".

Dislodging a container ship blocking the Suez Canal, one the world's busiest trade routes, may delay delivery to Europe of around 1 million tonnes of liquefied natural gas (LNG) on 10 vessels if the blockage lasts for two weeks, researcher Rystad Energy said.

"Furthermore, the SCA expressed honest gratitude for all the offers it received for assistance in this regard, while also highlighting the ongoing efforts towards refloating the container ship and affirming its keenness on ensuring regular global maritime traffic in the Suez Canal as soon as possible", it added.

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Detouring around Africa is likely to tack on a week or two to most ships' journeys, depending on where they were when they chose to change course. I'm sure other ships are on a much tighter schedule than we were.

A spokesperson for the U.S. Navy told the Financial Times that it has received concerned calls from shipping companies anxious about the threat of piracy if they divert shipments around the Cape of Good Hope as several freighters have already done.

The Ever Given, which is operated by Taiwan-based Evergreen Marine Corp., was headed to Netherlands on Tuesday when it ran aground in the 120-mile-long passage from the Red Sea to the Mediterranean during a dust storm.

With the bow plowed into one of the banks of the canal, an excavator has been put into service and dredgers have tried to clear silt around the ship.

The Ever Given has cut access in the middle of the waterway, forcing the ships to wait in limbo, either along the canal or at either end.

GAC, a global shipping and logistics company, had previously said the ship had experienced a power blackout, but it did not elaborate. "So ships are created to flex, but not to be kept at that position with a full load of cargo for weeks at a time".

So, if you're unclear on what the canal is, what's been going on and why it's significant- here's a breakdown.

The unprecedented pile-up "would be an annoyance but manageable" under normal circumstances, he added. "Second-round effects will be even more important as supplier input and possibly consumer prices increase", Boata explained.

The Suez Canal Authority, which operates the waterway, deployed tugboats and a specialized suction dredger that is able to shift 2,000 cubic meters of material every hour.

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