Shipping Canals Pose New Year Supply Chain Threat

We head in to 2024 with issues surrounding the world’s two global shipping canals, perhaps posing the biggest to global logistics and supply chains during the first part of next year.

Severe drought in Latin America and the conflict in the Middle East are now impacting journeys that would usually use the Panama and Suez Canals.

Central America has witnessed severe drought this year and the Panama Canal has been disrupted by low water. Usually, around 38 vessels would pass through the waterway every day, but this is now down to 22, and as we are approaching summertime in the region, this is expected to reduce to 18 vessels per day by February.

The entrances have been heavily congested, with large queues forming and it has recently been reported that 43 of the next few weeks voyages have been rerouted away from the canal.

However, the situation in the Middle East and the impact on the Suez Canal is perhaps more concerning. The canal is situated less than 150 miles from Gaza, and while it is operating as normal, the escalation of the Israel-Gaza conflict has led to cargo ships being attacked in the region.

As a direct result, a host of vessels have now set out to avoid the area and are alternatively travelling around Africa, adding between 10 and 12 days to Asia-Europe transit times. Thus far, a reported 22 voyages have been rerouted and we could see more announcements in the coming days and weeks.

Both global issues look set to continue for the foreseeable future, which are set to be the biggest threat to supply chain for the next few weeks or more.

The team at Croft Cargo are keeping a close eye on both situations and will be working hard to provide you with the best possible solutions as they unfold.

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** 18th December Update - Maersk have paused all ships travelling around the Red Sea area due to Friday's attacks on container ships.

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