How Yemen's Houthi attacks in the Red Sea are affecting cargo prices and delivery times - Broekman Logistics
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How Yemen’s Houthi attacks in the Red Sea are affecting cargo prices and delivery times

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The recent assaults on commercial vessels by the Houthi in the Red Sea area and the Gulf of Aden are a cause for concern. These attacks pose a risk to global supply chains that rely on the Red Sea and the Suez Canal, accounting for 30 percent of all container ship traffic and serving as a crucial conduit for crude oil shipments.

Major carriers, such as Maersk and CMA CGM, have opted to reroute their vessels via the South of Africa, potentially extending the journey of your cargo by 2 to 3 weeks.

The inevitable impact on supply chains is expected due to the redirection of ships away from the Red Sea. However, Martijn Tasma, Head of International Freight Forwarding & Shipping at Broekman Logistics, notes that consumer goods are likely to face the most significant impact, even though the current disruption has occurred “during the off-peak shipping season.”

Anticipating a reduction in available carrier capacity, we foresee increased pressure on ocean freight rates. The temporary suspension of shipments by some oil giants through the affected route may also influence fuel prices. Additionally, the misplacement of ships and containers could lead to potential congestion at ports and further delays. While there might be increased congestion in some ports in the coming weeks, the expected impact is lower than what was observed during the Covid-19 period.

The disruptions in shipping are causing a domino effect on international supply chains. Companies relying on timely deliveries of raw materials and finished products are experiencing delays, potentially leading to production interruptions and shortages. These disruptions not only affect the maritime sector but also have repercussions on other industries, such as automotive, electronics, and retail. As your trusted logistics partner, we are prepared to offer alternative transportation modes in the coming months, such as rail freight or air freight, though this may exert additional pressure on airfreight capacity in early 2024.

Maersk and Hapag-Lloyd, both of which have experienced attacks by Houthi rebels, appreciate the additional measures taken for security but acknowledge the challenge of determining when they can resume using the Red Sea, implying potential disruptions for an extended period.

It is imperative for the international community to collaborate and find effective solutions to ensure the safety of maritime routes and minimize the impact on the world economy. If the threat persists, there could be enduring changes in the logistical strategies of companies and governments globally. We understand the potential impact on your supply chain, and rest assured, we will diligently review the situation and keep our customers informed of any developments.

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Tomas van der Maarel

The Netherlands
+31620021614

Ricardo Patricio Huercio

The Netherlands
+31612509197
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