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Houthi rebels impact Suez Canal transits almost as much as the Ever Given ship blockage!

Posted on January 24, 2024

As the chart from JPMorgan below shows, the impact has been devastating.

JPMorgan commented as follows:

“The economic spillover in the Middle East has broadened: 12%-15% of world trade passes through the Red Sea, including 30% of global container traffic. More than 100 ships have already been diverted around South Africa, causing shipping rates from Asia to North America to rise by 75% over the last month; Flexport expects them to increase by an additional 50%-100% by the end of January. Most large shipping groups have suspended Red Sea operations, leading to a 1.3% decline in world trade in December. But the overall inflation impact is likely to be modest given very high inventory to sales ratios, deflation in e-commerce, cooling global demand for goods and plenty of capacity in the logistics industry (record containership deliveries expected in 2024).”

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