Maersk: Red Sea disruptions may extend into H2 2024

Logistic disruptions caused by the recent crisis in the Red Sea may continue into the second half of 2024, Charles van der Steene, regional president for Maersk North America, stated to CNBC. The company has advised its clients to prepare for extended transit times and increased uncertainty in global trade routes.

Despite the actions of US-led multinational force, Operation Prosperity Guardian (OPG), attacks by the rebel groups on commercial vessels persist. “We’re advising customers the longer transit routes could last through Q2 and potentially Q3,” Steene said.

Maersk has increased vessel capacity to offset delays caused by longer routes around the Cape of Good Hope. Nonetheless, Steene warned of the impact of longer transits and increased costs on trade consistency and supply chain logistics.

Currently, there are three supply chain headwinds, namely Red Sea crisis, East Coast port labor negotiations, and the Panama Canal drought, Steene said.

Global ocean freight rates have skyrocketed due to the longer voyages in January, while they peaked and corrected down for the past two weeks at the time of writing, although freight rates are still way above the pre-Red Sea period.