InvestorQ : With the Ship being moved in the Suez Canal, can we assume that global trade, include India trade, will get back to normal?
Mary Joseph made post

With the Ship being moved in the Suez Canal, can we assume that global trade, include India trade, will get back to normal?

Answer
image
Arusha Ray answered.
2 months ago
Follow

The reality is that the ship has only been ungrounded from its position but it is yet to be moved out of the Suez Canal. Nearly 30% of the container volume goes through Suez Canal, especially products like consumer electronics, apparel etc. The stretch of the Suez Canal extends for around 193 KM. Of course, the actual disruption caused to global trade may actually a few weeks to settle and get back to normal.

Due to the blockage, ships have been blocked both ways, Goods from Asia to the West and also ships carrying empty containers are all stuck and that could delay shipments for a few more weeks to come. In fact, the world’s largest shipping company Maersk estimates that even after the canal is reopened, the ripple effects could last much longer. Many such ships are either stuck in the canal or are waiting outside to enter the canal.

Most of the global shipping companies, including the Indian shipping companies, have routed some of their important vessels to sail south of Africa via the Cape of Good Hope. It is estimated to take at least 7 days for the entire queue to pass through. Shipping companies expect the second quarter of 2021 to face some serious disruptions. The Suez backlog could make it tougher for European and US companies to stock products.

One of the major risks in the round-Africa route is the presence of pirate gangs in these areas.

0 Views