$10bn a day: Value of goods stuck due to Suez blockage

Incident threatens to pose major disruption to global trade

As per one estimate, the bizarre incident stalled an estimated $9.6 billion-worth of cargo between Asia and Europe each day during the six-day blockage. | Photo: Twitter

Efforts to dislodge a 400-metre ‘megaship’ that has blocked Suez Canal – one of the most important waterways in the world – continued for a third day on Thursday.

Traffic has been blocked at both ends of the Egyptian canal ever since the 220,000-ton Ever Given became lodged on its eastern bank on Tuesday morning after losing the ability to steer amid high winds and a dust storm.

Eight tugboats have been trying to push and pull the ship free, the Suez Canal Authority (SCA) said in a statement.

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Peter Berdowski is the CEO of Dutch company Boskalis, which is trying to free the ship. He told the Dutch TV programme Nieuwsuur it was too early to say how long the job might take. “We can’t exclude it might take weeks, depending on the situation,” he said.

“It is like an enormous beached whale. It’s an enormous weight on the sand. We might have to work with a combination of reducing the weight by removing containers, oil and water from the ship, tugboats and dredging of sand.”

Major Disruption

The incident has led to one of the worst shipping jams in years, with several dozen vessels backed up at either end of the canal.

The blockage threatens to pose major disruption to global trade, with the value of goods stuck in the jam rising by about $10 billion a day, according to a UK newspaper report.

Lloyd’s List estimates the daily value of containers travelling through the canal to be $9.5 billion, the UK Telegraph said.

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The newspaper quoted Rebecca Harding, CEO of trade data firm Coriolis Technologies, as saying the incident poses an “absolutely enormous” risk to global trade.

“It’s hard to understate just how important it is,” she says. “It’s really important that those routes are kept open.”

Indian Crew Safe

The Japanese owner of the ship on Thursday apologised for the disruption caused by the blockage, and said it was “working hard to resolve the situation”.

Shoei Kisen Kaisha said the ship’s 25-member crew, all Indian, were safe and that no oil leaks had been detected.

Crucial Waterway

The Suez, arguably the world’s second-most-important waterway after the Panama Canal, links the Mediterranean with the Red Sea and shipping lanes to Asia. It is 120 miles long, 24 metres deep and 205 metres wide and can handle dozens of giant container ships a day.

The waterway accounted for 12 per cent of global trade in 2019, according to the Suez Canal Authority. In 2014  Egyptian president Abdel Fatah Al Sisi announced an expansion of the canal, at a cost of $8.5 billion.

The Ever Given is 400 metres long – longer than the Eiffel Tower and is three years old (built in 2018). It carries the equivalent of 20,000 units of 20-foot containers. The Ever Given belongs to a new category of ships called ultra-large container ships. It was travelling from China – the factory of the world – to the Netherlands.

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