The Red Sea shipping crisis exceeds 200 days, forcing container ships to detour 4,000 miles around the Cape of Good Hope, escalating costs and transit times.
Over 200 days have passed since Houthi rebels began attacking ships in the Red Sea, severely disrupting Suez Canal traffic. Container ships are forced to take a 4,000-mile detour around the Cape of Good Hope, significantly increasing transport times and freight costs. Freight rates from India to Europe have surged four to five times, ranging from $4,000 to $6,000 per container.
Houthi attacks in the Bab el-Mandeb strait between Djibouti and Yemen continue unabated, shifting from air drones to sea drones loaded with explosives. Despite ceasefire negotiations, the situation remains dire, with no resolution in sight. June saw intensified Houthi activity, including the sinking of a vessel and the rescue of sailors by a US carrier strike force.
The crisis has led to congestion at transshipment ports like Singapore and Port Klang, further straining global supply chains. JP Morgan reports a nearly fivefold increase in shipping costs on key routes from Asia to Europe, impacting global container shipping capacity by about 9%.
The prolonged disruption is likely to have lasting effects on shipping costs and the prices of imported goods, exacerbating global supply chain challenges.
