The global shipping industry has faced significant impacts in recent months due to the ongoing crisis in the Red Sea and the Gulf of Aden. This crisis, which began in mid-December 2023, has caused disruptions to global trade and shipping routes due to attacks on ships by Houthi rebels in Yemen.
Understanding the Red Sea crisis
The Red Sea shipping crisis has caused reduced traffic in the Suez Canal, the shortest maritime route between Asia and Europe, as shipping companies reroute their ships around the Cape of Good Hope instead. It has increased delivery times by ten days or more, affecting the efficiency of global supply chains.
Impact on shipping routes and freight rates
The crisis has also resulted in a sharp rise in freight rates from Asia to Europe and the Mediterranean, affecting other shipping routes and spreading to air freight, affecting routes from Asia to Europe, North America, and South America.
Meanwhile, the soaring costs of sea freight and delays in transit times have pushed more time-sensitive cargo towards air freight services, further impacting air operational costs.
Latest updates on the Red Sea shipping crisis
A recent report by WorldACD revealed an “exceptional surge” in air freight tonnage and rates from the Middle East to Europe, with a 40% increase in tonnage compared to the same period last year.
While the market from India has eased slightly, prices are still up by 164% year-on-year, remaining “particularly high.” Routes from Dubai and Colombo have also seen price increases of 44% and 51%, respectively.
Navigating the crisis
In conclusion, the ongoing crisis in the Red Sea highlights the importance of strategic planning and flexibility for international shippers. By staying informed, adapting to changing circumstances, and leveraging the right partners and services, shippers can mitigate the impact of these challenges and keep their supply chains running smoothly.
At ASLG, we understand the challenges due to the Red Sea crisis. We offer competitive sea freight prices and ensure smooth transportation to help through these challenging periods. Additionally, we have launched a 20% discount promotion with CZ Airlines to support air freight shipments.
