Ever Given Free, Let the Fallout Begin

She’s afloat once again. The Ever Given, which was stuck sideways in the Suez Canal, has been freed. Yahoo Finance posted a Youtube video, showing the the megaship moving again. The video is forty minutes long, but don’t worry, most of the video is exactly the same as the rest, so it’s well worth your time.

Faster Than Feared

While one of the companies hired to get the ship free said it could take weeks, in actuality, the Ever Given’s time stuck in the middle of the Suez Canal lasted a little less than a week. It got wedged sideways last Tuesday and freed yesterday (Monday). Maybe the company was creating buffer time in order to look great when freeing the ship faster. I’ll give them the benefit of the doubt that there was no telling how long it would take to free the Ever Given.

While we’ll miss the memes of the ship, we are happy that traffic will be able to move through the Suez Canal again. If you missed the memes altogether, here’s a Tastefully Offensive post that shared 20 of them. One of the memes shows I wasn’t the only person reminded of Austin Powers when Evergreen’s megaship got stuck sideways:

We’ve Only Just Begun… To Have Problems Suez Canal Jam

In last Thursday’s blog, there was a section about port congestion and the rippling effect the Suez Canal congestion from Ever Given being stuck in it would cause. Much of the focus was on port congestion that would likely be caused at European ports from the tidal wave of ships coming through once the Suez Canal was cleared and the ripple effect that would be seen on supply chains across the global shipping industries. However, there are plenty of ships that go through the Suez Canal headed to U.S. East Coast ports. We very well could see more port congestion problems as a result.

In fact, American Shipper published an article by Greg Miller yesterday about the fallout U.S. ports and shippers are about to face from the chaos at the Suez Canal:

In the U.S. market, East Coast cargo flows will bear the brunt of the fallout, although consequences will be felt nationwide.

Most of the boxes transiting the Suez Canal move from Asia to Europe. But the waterway also handles very significant volumes from Southeast Asia and India to the East Coast.

…

… almost one in three containers from Asia transits the Suez Canal en route to the East Coast.

The result of this is similar to what we talked about in the last blog post with European ports. U.S. East Coast ports are likely going to see a surge in ships arriving, which will likely cause congestion problems. More congestion problems.

Congestion is currently worse at West Coast ports, with the Ports of Los Angeles and Long Beach being poster children for ship backups, but there has been plenty at East Coast ports too. The Port of New York and New Jersey has been especially bad on the east side of the country. In a couple of weeks, East Coast ports could make a run at catching up to West Coast ones for highest congestion.

Before extra ships arrive, there’s a little period of lull when ships that were supposed to arrive do not. This may help East Coast ports prepare as much as they can for the likely surge. Still, when ships arrive in bunches, there will be ships that have to anchor and wait for docks to open. Delays can only be mitigated to a point.

Services Disrupted

Miller included in his American Shipper article one of the best lists I’ve seen of disrupted ocean freight carriers’ services (that specifically include U.S. ports) from the Suez Canal blockage:

Services: EC4, EC5 (THE Alliance) — Rotation: Taiwan, China, Singapore, Vietnam, NY/NJ, Norfolk, Charleston, Savannah. Average vessel capacity: 13,929 twenty-foot equivalent units (TEUs). YM Mandate at anchor in Red Sea. MOL Maestro at anchor off Port Said, Egypt. ONE Munchen, YM Wellhead, ONE Marvel rerouted around cape.

TP17 (2M) — China, Hong Kong, Vietnam, Singapore, NY/NJ, Charleston, Savannah, Miami, Freeport (Texas). Average vessel capacity: 9,093 TEUs. Adrian Maersk at anchor off Port Said. Axel Maersk at anchorage in Red Sea. Maersk Algol and Arnold Maersk rerouted around cape.

TP11 (2M) — Vietnam, Singapore, NY/NJ, Norfolk, Savannah, Freeport (Bahamas).GSL Grania at anchor off Port Said. Maersk Skarstind, Maersk Santana, Maersk Kowloon rerouted around cape.

India America Express/IEX (CMA CGM, Hapag-Lloyd, ONE, OOCL) — India, Egypt, NY/NJ, Norfolk, Charleston, Savannah. Average vessel capacity: 9,513 TEUs. Athenian at anchor off Port Said.

Columbus Jax (Ocean Alliance) — multiple loops, including China, Vietnam, India, Halifax (Nova Scotia), NY/NJ, Norfolk, Charleston, Savannah. Average vessel capacity: 12,456 TEUs. CMA CGM Lyra at anchor off Port Said. CMA CGM Leo rerouted eastbound around cape.

Indus Express (MSC) — India, Saudi Arabia, Israel, Italy, Spain, NY/NJ, Norfolk, Charleston, Freeport (Bahamas), Houston. Average vessel size: 8,546 TEUs.MSC Giulia at anchor off Port Said. Northern Javelin rerouted eastbound around cape.

MECL(Maersk, Sealand) — India, Dubai, Oman, Djibouti, Egypt, Spain, NY/NJ, Norfolk, Charleston, Savannah, Houston. Average vessel size: 6,363 TEUs. Maersk Denver at anchorage in Red Sea. Maersk Seletar at anchor off Port Said.

Conclusion

We’ll have to keep an eye on how much international shipping gets impacted from the week of the Suez Canal being blocked by the Ever Given.

Beyond the disrupted routes and potential port congestion, container and equipment shortage problems the industry has been experiencing could be exasperated. How many blanked sailings will we see from carriers readjusting fleets? Will this be one more thing keeping freight rates high?

Things could have been worse with an even longer period of the Ever Given being stuck in the Suez Canal, but there will likely be plenty of fallout for shippers, and the international shipping industry in general, to deal with from this event.