Suez Canal struggles continue in July

Suez Canal struggles continue in July

   Suez Canal transits and tonnage slumped severely in July amid reports that the canal has begun offering non-published discounts to ship owners in a bid to lure them through the key waterway linking Asia with Europe.

   Analysis of monthly statistics provided by the canal authority shows that transits fell 18 percent in July to 1,521 transits, compared to the same month in 2008, while tonnage also fell 18 percent to 64.8 million tons. Containership transits fell further, by 25.7 percent to 536 transits. Containership tonnage fell by a smaller margin, 15.6 percent to 35.8 million tons.

   Containerships accounted for 55.2 percent of tonnage transiting the canal in July, compared to 53.4 percent in July 2008. The steeper fall in transits than tonnage suggests larger ships are plying the canal.

   Also of note is the steep drop in tonnage moving from south to north through the canal (in other words from Asia and the Middle East to Europe and North America) versus north to south.

   Tonnage moving north to south dropped only 2.5 percent while south to north dropped 37.6 percent. The canal last year saw a roughly 55-45 split between south/north and north/south traffic. But this year, the ration has swung the other way. That's likely due to falling European demand for exports from Asia and ocean carriers' subsequent decisions to pull services and the rise of piracy in the Gulf of Aden at the mouth of the Red Sea, which leads into the Suez.