The head of the Suez Canal Authority said the damage caused by the blockage of the giant ship “Ever Given” in the canal and the blockage of the shipping lanes could reach $ 1 billion.
How much has the blockage cost?
About 12% of global trade, around one million barrels of oil and roughly 8% of liquefied natural gas pass through the canal each day.
SCA chairman Osama Rabie on Saturday that the Canal’s revenues were taking a $14m-$15m (£10.2m-£10.9m) hit for each day of the blockage.
Prior to the pandemic, trade passing through the Suez Canal contributed to 2% of Egypt’s GDP, according to Moody’s.
Separately, data from Lloyd’s List showed the stranded ship was holding up an estimated $9.6bn of trade along the waterway each day. That equates to $400m and 3.3 million tonnes of cargo an hour, or $6.7m a minute.
Looking at the bigger picture, German insurer Allianz said on Friday its analysis showed the blockage could cost global trade between $6bn to $10bn a week and reduce annual trade growth by 0.2 to 0.4 percentage points.
Shipping broker Braemar ACM told the Wall Street Journal that the cost of renting some vessels to ship cargo to and from Asia and the Middle East had jumped 47% to $2.2m.
Some vessels have been rerouted to avoid the Suez Canal. That is adding around eight days to their total journeys.
Countless businesses affected
The Suez Canal blockage doesn’t just affect the global shipping industry or the Egyptian economy – countless businesses, from domestic transport providers to retailers, supermarkets, and manufacturers are also impacted.
The true damage and cost are difficult to evaluate until the ship is fully freed and trade resumes.
British firms told on Friday, that they were still waiting to find out when goods were likely to arrive.
One UK company, Seaport Freight Services, said it had 20 containers of goods stranded on the Ever Given
“We’re waiting on food goods like coconut milk and syrups, some spare parts for motors, we’ve got some forklift trucks, some Amazon goods on there, all sorts,” the company said.
There were concerns that if the blockage at the Suez Canal continued, some firms will have to pay to order more goods and have them sent over by air freight, which costs at least three times more.
