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Disruptions in the Red Sea continued into the third quarter

Jul 26, 2024 World

Global ocean carrier AP Moller-Maersk has warned that the coming months will be difficult for both carriers and businesses as the conflicts in the Red Sea continue to affect the normal functioning of supply chains

As the attacks on ships in the Red Sea / Gulf of Aden that began in December 2023 continue, Maersk ships have continued to divert around Africa via the Cape of Good Hope in South Africa. This situation is causing major disruptions and capacity constraints in the shipping industry, as more ships and more time are required in the face of continued high demand for container transport.

“We are faced with these challenges together and we need to make sure that we stay close to them as we handle the new set of circumstances that continues to unfold in front of us. These disruptions, and the impact they are having on your business, are not something that I, nor any colleagues at Maersk, take lightly”, said Vincent Clerc, CEO of Maersk at an online event with customers.

To deal with this situation, the company has redeployed underutilised ships to other parts of the world to “plug holes”, which has alleviated part of the problem but not solved it.

“We are going to have in the coming month missing positions or ships that are sailing that are significantly different sizes from what we normally would have on that string, which will also imply reduced ability for us to carry all the demand that there is”, he explained. In addition, the increase in costs cannot be overlooked, as the price per container has risen substantially.

The CEO of the global ocean carrier also called on governments to pay more attention to the situation in the Red Sea. “In some regions like Europe, governments need to understand the possibility that this will reignite inflation”, concluded Clerc.

Image Credits: supplychainbrain.com

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