One of the world’s most vital trade arteries has been blocked by a quarter-mile-long container ship, creating a traffic jam that has ensnared over 200 vessels and could take weeks to clear.
But even before the Ever Given ran aground in the Suez Canal earlier this week, global supply chains were being stretched to the limits, making it much more expensive to move goods around the world and causing shortages of everything from exercise bikes to cheese at a time of unprecedented demand.
A prolonged closure of the key route between West and East could make matters much worse. Costly delays or diversions to other routes will heap pressure on businesses that are already facing container shortages, port congestion, and capacity constraints.
The grounding of the Ever Given will delay shipments of consumer goods from Asia to Europe and North America, and agricultural products moving in the opposite direction.
As of Friday, some 237 vessels, including oil tankers and dozens of container ships, were waiting to transit the canal, which handles about 12% of global trade.”There’s been a great convergence of constraints in supply chains like I’ve never seen before,” said Bob Biesterfeld, the CEO of C.H. Robinson, one of the world’s largest logistics firms.
The bottlenecks are widespread, affecting transport by air, ocean, and road, Biesterfeld said “It really has been unprecedented.”