A massive container ship stranded in Suez Canal
The picture above is probably the talk of the town nowadays. A massive container ship stranded in the southern passage of the Suez Canal (the one with the single-canal) is blocking the passage since last Tuesday and no sign of hope to let is float any time soon.
The Ever Given is one of the biggest container ship that are nowadays sailing the oceans, laid down in 2015 and managed by the Taiwanese Company Evergreen Marine, with its 400mt length and 60mt wide has stuck in the Canal for apparently still unknown reasons nevertheless it seems to be likely a gust of wind during a sand storm that drifted the ship out of control sending it to the banks.
The ship left from Shanghai to port in Rotterdam in Europe but got stuck on the way, this is causing about almost 10bl USD of damage every day, the Suez Canal is indeed one of the busiest passages in the world. It is estimated that 12% of the seaborne trade is passing in the canal along with 50 ships/day and it is crucially important for the trade Asia-Europe and the other way around (source CNBC).
Apparently the ship drifted so much that stuck its nose into the sands and soil of the banks of the canal which is narrower than the length of the ship itself, the enormous weight did not help definitely the maneuverability and the disaster happens..
After a few days working, the experts are considering to remove and excavate the soil under the nose to free the giant ship and/or using tugboats to put it out of the banks but so far every effort seems vain, as the ship is still stuck. Some says it might take days or even weeks to remove the ship and finally restore the maritime traffic in the canal. In the meantime experts are also considering to unload the cargo (remember that the ship is carrying about 20.000 containers) to decrease the weight and hope that a lighter ship will be easier to drag out of the banks but this idea does not seem to be very likely.
Due to the fact the ships are engineered to be loaded in good conditions in the docks, the cranes will have quite a few troubles to execute the unloading operations with an unstable and uneven 400mt long grounded container ship.
Great impact on Asia-Europe trade
Since its construction, more than 150 years ago, the Suez Canal represent a vital trade route for trade between Asia and Europe. The passage allows the ships and trade to bypass Cape of Good Hope avoiding to pass around African continent and so shorten the trip by 8/10 days.
In case the Canal blockage will last longer than expected, the shipping companies will be forced to restore the old commercial route around Cape of Good Hope to avoid paralyzing the world trade, but this will have a few implications:
– longer transit time Asia-Europe
– higher transport costs (see our earlier article related to transport cost HERE)
– risk of goods shortages (especially for those companies that are running low stock to maximize logistic efficiency)
Some shipping agents and brokers have already cancelled the booking from Europe to Asia, so apparently even if you have goods to ship to Asia, there is no way to send them! Shortage of products will automatically increase the price, having a deep impact in world consumes and trade which have been already cracked down by the pandemic.
We can not fail to consider how a ship, stranded in a canal, can cause all this..
Bangkok, 28 March 2021
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