From 14th December 2023 to date, the Red Sea channel has been impassable owing to attacks on vessels, allegedly by Yemen rebel groups.
Because of the said security breach, ocean carriers have discontinued their service through the channel, with some of them already having made a decision to use the longer Cape of Good Hope route to and from the East African coast and Europe.
The Red Sea is a key maritime channel for trade between Europe, the Middle East and Africa, and with it having become a no-go area, supply chains to and from the aforesaid regions have significantly been affected.
Notwithstanding the long transit times that the Cape route will come with, carriers have already announced a raft of surcharges that will be applicable to shipments affected by the current state of affairs, a move that will add to the huge cost that traders are having to grapple with owing to inability to replenish their stocks and/or service their customers’ orders.
To date, there is no telling for how long the hold-up will continue. The situation still looks very grim.
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