Suez Canal crisis: How one boat caused a trading nightmare
We’re sure you’ve probably seen all the memes all over Twitter by now, but in case you don’t know the details yet, we’re here to fill you in on everything you need to know about the Suez Canal crisis that began all the way back last Tuesday. Since this began, memes & jokes have been flooding everyone’s social media timelines like crazy, but all jokes aside, this occurrence has impacted global trade tremendously.
What happened at the Suez Canal?
On Tuesday, the Ever Given container ship got stuck in the Suez Canal in Ismailia, Egypt, and blocked off access to one of the world’s most crucial shipping routes. The Japanese-owned vessel was traveling to Rotterdam from China when high winds caused the bow to crash into the eastern bank of the canal around six kilometers north from the Southern canal entrance.
This accident caused a huge build up of maritime traffic, causing hundreds of ships to get stuck outside of the canal’s entrance, with hundreds more unknowingly en route to the entrance as well. This makes the Suez Canal crisis a much larger issue as it’s not just the Ever Given ship that has been impacted, but all of the hundreds of other container ships blocked on the canal as well that won’t be able to go anywhere.
Aidan Flynn, the general manager of the Freight Transport Association of Ireland, explained to the Irish Examiner that “supply chains have been and will be significantly impacted by the blockage and that this will have a knock-on effect for Irish and European consumers importing products via the Suez Canal”.
A global trade nightmare
So how drastic did the Suez Canal crisis impact global trade? While it’s definitely put a delay on trade, this situation has also been incredibly costly to fix. Aidan Flynn told the Irish Examiner that there were consequences, “basically costs and time”.
Flynn added: “There are additional costs that will definitely have to be passed on to the consumer because you could be talking about over €100,000 of additional fuel being burnt going in that direction as well”. This delay also obviously affected the time it will take for goods to reach consumers, and Flynn stressed that the price of the extra cost from all the delays will have to be passed on to the consumers.
“The Suez Canal accounts for nearly 30% of all container ship traffic,” said Interos’ Bisceglie, “with carriers transporting oil, natural gas, clothing, food, electronics, machinery, and even semiconductor chips, an item which has already been in the midst of a global shortage”.
“Components for manufacturing, ingredients for the pharmaceutical industry, everything that you can think of and that’s just on that ship itself, not to mention the other hundreds that are affected”, Michael Kingston told the Irish Examiner.
The Ever Given ship is free and traffic is resuming in the Suez Canal…pic.twitter.com/nPhyc1Ao2Z
— Rex Chapman🏇🏼 (@RexChapman) March 29, 2021
When the Suez Canal crisis first happened, some experts predicted that it could take possibly weeks for the ship to successfully re-float and resume its journey. Thankfully, the situation was solved on Monday after almost a week and the maritime traffic was able to resume back to normal.
“The first ship of the northern convoy crossed the Suez Canal at Port Said”, the Suez Canal Authority confirmed. “Navigation will return naturally in the Suez Canal in both directions Monday evening”.
Canal authorities told NBC News that “Dredgers worked over the weekend to dislodge the stranded vessel, shifting huge quantities of sand in an effort to help free the stranded ship”. Numerous tug boats were needed to help pull maneuvers from three different directions in order for the ship to be dislodged. After the vessel was partially refloated, the high tide finally helped bring the water level back up to resume the journey.