Charting a New Course, Maersk Resumes Red Sea Routes Amidst Global Shipping Shift

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In a strategic move announced on Wednesday, Denmark’s Maersk, a key player in the global shipping industry, has unveiled plans to navigate several dozen container vessels through the Suez Canal and the Red Sea in the coming days and weeks. This decision signals a noteworthy shift as major shipping firms, including industry giants Maersk and Hapag-Lloyd, return to these routes.

The abrupt cessation of Red Sea routes by top shipping companies followed targeted attacks on vessels by Yemen’s Houthi militant group, causing disruptions in global trade. Maersk, in particular, witnessed a 5% dip in its share price by 1330 GMT on Wednesday, partially reversing gains from the previous week. Analysts speculate that the return to shorter Suez Canal routes may trigger a correction in freight rates.

The repercussions were not limited to Maersk, as other shipping stocks experienced declines. Hapag-Lloyd saw a 6% drop, Frontline, the oil tanker group, was down 5.3%, and Hoegh Autoliners, the car shipping service, registered a 3% decrease.

Maersk had previously announced on December 24 its intention to resume Red Sea journeys, citing a U.S.-led military operation against Houthi attacks. However, the company provided few details, emphasizing that the schedule remains subject to change based on evolving contingency plans.

France’s CMA CGM also joined the shift on Tuesday, revealing plans to increase the number of vessels transiting through the Suez Canal. Maersk’s advisory to clients disclosed that the Maren Maersk, which departed Tangiers on December 24, is scheduled to “continue via Suez Canal,” with an estimated arrival in Singapore on January 14. Nevertheless, the advisory indicated that many other vessels would continue the journey around Africa.

Since December 19, Maersk rerouted numerous ships around Africa via the Cape of Good Hope to mitigate the risk of attacks, imposing additional fees on customers and prolonging transportation times from Asia to Europe and the east coast of North America.

In response to the challenges, Maersk announced on December 22 the implementation of charges, including a $700 fee for a standard 20-foot container traveling from China to Northern Europe. This fee comprises a $200 transit disruption surcharge and a $500 peak season surcharge, effective from January 1. The impact of the decision to restart some Red Sea shipments on these surcharges remains uncertain.

When queried about vessel schedules, a Maersk spokesperson declined to provide further details, stating, “At the moment, we cannot say anything more than what has been shared.”

Meanwhile, German rival Hapag-Lloyd deems the situation too perilous for passage through the Suez Canal and continues to reroute vessels via the Cape of Good Hope. A spokesperson for Hapag-Lloyd mentioned an ongoing assessment of the situation, with plans for a review on Friday.

Source: Reuters

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