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Four days later, the Ever Given is still exactly where they left it. The situation is absolutely deadlocked at the Suez Pass. This is what you need to know.
The blockade in the Suez Canal, caused by the huge Ever Given cargo ship since last Tuesday, is generating great concern in international trade. To put it in perspective, each hour that passes through the closed passage costs the global economy an estimated $ 400 million. This translates to just over $ 9 billion a day.
Twitter user Tom Neill, founder of the Time to Spare graphics page, created the website Is that ship still stuck? (Is that ship still stuck?) In which he reports the current status of Ever Given and the cost left by the blockade thus far. According to its page, the blockade has cost more than US $ 43 billion as of Saturday afternoon.
But why is it causing such an impact? These are some questions you may be asking yourself about the blockade on the Suez Canal.
What is the Suez Canal and why is it so important?
It is not the Panama Canal, but the Suez crossing is important for the transport of products around the world, including Latin America, as it allows it to be much more direct. Thanks to this step it can be transported from Europe to Asia and vice versa without the need to circumnavigate all of Africa, thus saving days of travel. It is estimated that 10% of global trade passes through there. It was built in the 19th century and is located in Egypt, and connects Port Said on the Mediterranean Sea with the Indian Ocean.
Where is the ship that ran aground from and why did it happen?
The Ever Given, 400 meters long and 60 wide, was registered in Panama and is operated by the Taiwanese company Evergreen Marine. One of the first theories is that the strong winds diverted the ship from its route and caused it to run aground. But the port authorities have ruled out that this is the case, and have pointed out that it could be a technical or human error.
Although there have been accidental groundings, there was no blockage of this magnitude years ago. In 2004, a Russian vessel was stranded causing a three-day shutdown.
We recommend: Morning coffee could be at risk due to blockage in Suez Canal
What if it stays there?
It is not only the owners of the boats that are stuck and the companies that transport their products that are affected, consumers can also feel the blow of the blockade.
Coffee, toilet paper and gasoline could be in short supply in the world in a few days if the step is not reactivated. The effects have already been seen. For example, there was an increase in the price of Brent, which exceeded US $ 70. And the Brazilian company Suzano SA, which produces the wood pulp with which toilet paper is created, has delayed its shipments due to the stagnation of sea containers in the Suez. Nescafé has also been affected by the blockade, as ships transport containers full of robusta coffee, with which it makes its instant coffee.
How to get out of this crisis?
Several strategies have been tried to refloat the ship: towing it with trailers, dredging the area under the hull and digging the dike in which the bow is stuck, but due to the weight of the ship all efforts have been frustrated. According to Osama Rabie, head of the Suez Canal Authority, the blockade could last a few more days, even weeks. If the situation continues like this, the company in charge of the Ever Given will remove containers from the front end to make it easier to free the ship.
And even when the canal team manages to refloat the ship, the problems will not be over. There are about 300 vessels sailing from each end and they will reach already occupied ports. Such a bottleneck creates additional delays. For this reason, some ships, including the Ever Greet, the sister ship of the Ever Given, have chosen to divert and circle Africa to avoid further delays.
