Shipping line shares have become the fastest-growing in Europe since the beginning of 2024. In the past week, their rally has been the most significant in recent years as vessel rerouting after Red Sea attacks drove up freight rates.
Due to risks associated with transit through the Red Sea, major shipping lines are currently avoiding this route, which typically includes the Suez Canal. As a result, these carriers are now taking longer detours, notably around the Cape of Good Hope, to bypass the troubled area. Such changes extend cargo transit times to Europe by 10–14 days.
Vessel traffic through the Suez Canal dropped by 30% between January 1 and January 11 compared to 2023.
What are the implications?
— Shippers may face delays comparable to the COVID-19 period in 2020; — Prices for most goods will rise, including spring clothing, footwear, home goods, electronics, garden furniture, tools, etc.; — Delivery delays are expected due to longer routing and the approach of the Chinese New Year holidays, which will run from February 10 to 24.