© Reuters. The container ship runs aground in the Suez Canal and blocks traffic
By Yusri Mohamed, Gavin Maguire and Florence Tan
ISMAILIA, Egypt (Reuters) – A container ship blocking the Suez Canal like a “stranded whale” caused another setback to world trade on Thursday when officials stopped all ships entering the canal and the salvage company said it could Take weeks to be available.
The 400 m (430 yard) Ever Given blocks transit in both directions through one of the world’s busiest shipping lanes for oil, grain and other Asian-European trade for almost as long as the Empire State Building is tall.
The Suez Canal Authority (SCA) said eight tugs were working to move the ship, which was stuck diagonally across the single-lane southern section of the canal in strong winds and a dust storm on Tuesday morning.
“We cannot rule out that it may take weeks, depending on the situation,” Peter Berdowski, CEO of the Dutch company Boskalis, which is trying to free the ship, told the Dutch television program “Nieuwsuur”.
A total of 156 large container ships, tankers carrying oil and gas, and bulk vessels carrying grain have secured themselves at either end of the canal, the Leith agencies in Egypt said, causing one of the worst ship jams in years.
The blockade is in addition to the disruption in world trade that was caused by COVID-19 last year. The volume of trade was negatively impacted by high ship cancellation rates, a shortage of containers and slower handling speeds in ports.
The SCA, which had allowed some ships to enter the canal in hopes that the blockade could be lifted, said it temporarily suspended all traffic on Thursday. The shipping giant Maersk announced in a customer service that seven ships were affected.
Berdowski said the bow and stern of the ship had been raised against both sides of the canal.
“It’s like a giant beach whale. It’s tremendous weight on the sand. We may have to work with a combination of weight reduction, removing containers, oil and water from the ship, pulling boats and dredging sand.”
Around 30% of the world’s shipping container volume is handled daily via the 193 km long Suez Canal, and around 12% of all global trade in all goods.
Shipping experts say that if the blockage is not cleared in the coming days, some shipping companies may reroute around Africa, adding about a week to the trip.
“Every port in Western Europe will feel this,” said Leon Willems, a spokesman for the port of Rotterdam, Europe’s largest. “We hope for both businesses and consumers that it will be resolved soon. When these ships arrive in Europe, there will inevitably be longer waiting times.”
Consultancy Wood Mackenzie said the biggest impact was on container shipping, but there were also a total of 16 loaded crude and product oil tankers that passed through the canal and were now delayed.
The tankers carried 870,000 tons of crude oil and 670,000 tons of clean oil products such as gasoline, naphtha and diesel.
According to oil analysis firm Vortexa, Russia and Saudi Arabia are the two largest oil exporters through the channel, while India and China are the main importers.
Joanna Konings, senior economist in international trade analysis at Dutch bank ING, said the impact on the global economy would be limited if it did not drag on as container shipping is used to days of delays.
However, the German BDI industry association was concerned. Deputy Managing Director Holger Loesch said earlier delays had already had an impact on production, with industry being particularly affected, depending on raw materials or deliveries of building materials.
Around 16% of German chemical imports arrive by ship via the Suez Canal, and the chief economist of the Association of German Chemical and Pharmaceutical Manufacturers VCI, Henrik Meincke, said they would be affected by the blockade every day.
Ever Given technical director Bernhard Schulte Shipmanagement (BSM) said dredgers were working to remove sand and mud from around the blocked ship while tugs, in conjunction with Ever Given’s winches, were working to relocate it.
Japanese shipowner Shoei Kisen apologized for the incident, saying the work to free the ship, which was sailing from China to Europe, had been “extremely difficult” and it was not clear when the ship would float again.
The owner and the insurer face claims of several million dollars, even if the ship is quickly made afloat again, industry experts said on Wednesday. Shoei Kisen said the group’s hull insurer is MS & AD Insurance Group while the liability insurer is UK P&I Club.
The ship’s GPS signal shows only minor changes in its position over the past 24 hours.
Two professional rescue teams from the Netherlands and Japan will work with local authorities to develop a more effective float plan for the ship. The company has leased it, Taiwan’s Evergreen Marine Corp. said.