A Cautious Return To The Suez Canal Route As Security Remains Uncertain.

There has been a gradual return to the Suez Canal for some major shipping lines that would ultimately bring back shorter transit times and lower operating costs, although the Houthis have been increasing their activity.

For nearly three years, many Asia-Europe services have sailed around the Cape of Good Hope to avoid the security threat in the Red Sea. The diversion adds significant distance to each voyage, increasing fuel consumption while tying up vessels and containers for longer.

That is one reason carriers are becoming increasingly interested in Suez again. Maersk has been restoring services progressively, MSC has recently tested the route with seven vessels in two weeks, and CMA CGM has also increased its Suez traffic.

A wider return would release vessel capacity by shortening round voyages and reducing operating costs. Faster transits could also improve container circulation and schedule reliability for shippers.

However, the difficulty is that security remains a major uncertainty.

Attacks on commercial shipping have continued around Bab el-Mandeb, with one resulting in six fatalities and another vessel destroyed off Yemen this month. Some Saudi oil shipments have also reportedly been travelling through the region with AIS tracking switched off, underlining how seriously operators continue to treat the threat.

For shippers, Suez offers the prospect of faster and more efficient supply chains, but any benefits are likely to develop cautiously. The carriers that have already committed, or are testing, remain prepared to divert vessels around Africa at short notice again if conditions deteriorate, meaning a widespread return to shorter transit times may be some way off.

Croft Cargo is monitoring developments closely.

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