Industry News

Major Carriers Actively Rerouting Ships and Imposing Surcharges Amid Red Sea Security Concerns

December 21, 2023

Amid heightened security concerns and recent attacks in the Red Sea and Suez Canal, major carriers such as MSC, Maersk, ONE, and Hapag-Lloyd are actively rerouting their vessels, opting for the longer route around the Cape of Good Hope in Southern Africa. This strategic shift, prompted by security tensions, is being followed by additional carriers. The decision to circumnavigate the Cape extends journey times from 31 to 40 days and doubles fuel consumption.

Comparison of Red Sea Route vs Cape Route

In response to these challenges, container lines are swiftly introducing new surcharges to offset increased costs associated with rerouting and extended travel times. ONE has taken a proactive approach by implementing Emergency Peak Season Surcharges (PSS), announcing a charge of $500 per TEU on the Asia-Europe westbound trade effective January 1. Despite these measures, shipping companies anticipate delays, as the effectiveness of the US-led 10-nation task force, 'Operation Prosperity Guardian,' may take several weeks to materialize, according to Maersk's CEO, Vincent Clerc.