Denmark’s Maersk announce scheduling of vessels to traverse the Suez Canal in the coming days

Denmark’s Maersk has made an announcement regarding the scheduling of numerous container vessels to transit the Suez Canal and the Red Sea in the coming days. This move signals a potential return to normalcy for global shipping firms after disruptions in Red Sea routes, prompted by attacks from Yemen’s Houthi militant group. Major shipping companies, including Maersk and Hapag-Lloyd, had ceased operations in the region due to these security concerns.

Maersk’s decision to resume Red Sea routes has resulted in a 5% drop in its share price, leading to concerns about a potential correction in freight rates. This decline in Maersk’s share price has also impacted other shipping stocks, with Hapag-Lloyd experiencing a 6% drop, Frontline falling by 5.3%, and Hoegh Autoliners down by 3%.

The market reaction reflects apprehension about the economic impact of returning to shorter routes through the Suez Canal, which could reverse the gains made in the past week. Maersk’s decision to resume Red Sea routes for both eastbound and westbound journeys is attributed to a US-led military operation aimed at protecting vessels from Houthi attacks. However, the company provided limited details, and the schedule is subject to change based on contingency plans that may be developed in the coming days.

France’s CMA CGM is also increasing the number of vessels using the Suez Canal, indicating a broader trend of shipping companies reassessing their routes. Despite this, many of Maersk’s vessels are still set to circumnavigate Africa, as they have been rerouted since December 19 through the Cape of Good Hope to avoid attacks. Maersk imposed additional fees on customers and extended transportation times, introducing a $700 charge for a standard 20-foot container traveling from China to Northern Europe.

Meanwhile, German rival Hapag-Lloyd considers the situation too risky to use the Suez Canal and has chosen to reroute vessels via the Cape of Good Hope. Continuous assessments are being made, with a review scheduled to determine the feasibility of a Suez Canal passage.