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Suez & Panama Canal Operations Updates

Two key supply chain gateways have recently encountered major geopolitical and environmental challenges.

13 February 2024

Please consider bookmarking this webpage, where we will continue to publish important updates as they arise.

13 February 2024

OIA Global sincerely values your trust, loyalty, and understanding during these challenging times. Our team is working to ensure timely and transparent communication, and we encourage you to contact your dedicated OIA representative for anything urgent. We continue to monitor the Suez Canal and Panama Canal disruptions.

OIA Global’s Solutions Summarized

19 January 2024

The Panama Canal drought and Red Sea diversions have created a bottleneck on major East-West trade lanes. We reaffirm our unwavering commitment to keeping customers informed and providing innovative alternative solutions. Should you need guidance or support during these challenging times, please contact your designated OIA Global representative.

What we’re seeing in the market

  • Equipment and space shortages continue to impact space and container availability in Asia as we approach Chinese New Year.
  • Rate increases and surcharges continue to proliferate on major East-West corridors.
  • Service reliability remains challenging due to unexpected changes and/or cancellations.
  • On-time performance continues to deteriorate due to increased transit times from vessels taking alternative routes.
  • As a result of these market changes, expect port congestion to rise in various ports across Asia, Europe, and the Americas.

OIA Global’s Solutions

OIA’s innovative ocean freight solutions include a combination of established services and new expedited options for customers seeking shorter transit times. We offer several different options that serve as a strategic bypass of the Panama Canal and/or Suez Canal.

LCL EXPEDITED SERVICES

MIDWEST LCL EXPRESS SERVICE

This service moves from Shanghai or Shenzhen origins to New York City and Atlanta destinations, moving through Chicago and Cleveland terminals.
• This service is ideal for customers who want to avoid the Panama Canal, or the lengthy Cape of Good Hope detour around the Red Sea.

SEA / AIR TRANSPORT SOLUTIONS

Direct LCL services from over 28 ports in Asia to Jebel Ali* and Los Angeles**. From these airports, shipments have quick access to airports across Europe, Africa, and Central & South America.
*Ports with service to Jebel Ali include Bangkok, Busan, Chennai, Colombo, Ho Chi Minh, Hong Kong, Jakarta, Kaohsiung, Karachi, Mumbai, Ningbo, Port Klang, Qingdao, Shanghai, Shenzhen, Singapore, Tianjin, Tokyo.
**Ports with service to Los Angeles include Bangkok, Busan, Chennai, Colombo, Dalian, Guangzhou, Haiphong, Ho Chi Minh, Hong Kong, Jakarta, Kaohsiung, Karachi, Kobe, Manila, Mumbai, Nagoya, Ningbo, Pasir Gudang, Penang, Port Klang, Qingdao, Shanghai, Shenzhen, Singapore, Taipei, Tianjin, Tokyo, Xiamen.

SPRINT SERVICES

We currently offer LCL sprint services for cargo moving from Europe and Asia to the United States.

 

FCL EXPEDITED SERVICES

FCL TRANSATLANTIC WESTBOUND

The fastest alternative for FCL shipments moving Transatlantic Westbound to the U.S. West Coast is the land bridge solution transporting shipments between Europe* and the U.S. West Coast** through Halifax and Chicago.

*Europe origin and destinations include Antwerp, Liverpool, Hamburg, Dublin, Belfast, Gothenburg.
**U.S. West Coast origin and destinations include Seattle, Portland, San Francisco, Los Angeles, Denver. 

FCL TRANSPACIFIC EASTBOUND

For Transpacific Eastbound shipments to the U.S. East Coast, our Diamond service offers guaranteed space, equipment, and no delays moving through the Panama Canal.

  • Additional options via mini land bridge.

5 January 2024

Recently, supply chain operations at the Suez Canal and Panama Canal have encountered major geopolitical and environmental challenges. The resulting disruptions are having a profound impact on the global supply chain. Customers should expect persistent complications in these specific areas and ongoing disruption throughout the global network.

OIA Global is actively developing a comprehensive action plan to navigate these changes effectively. We are steadfast in our commitment to keep customers well-informed as the situations evolve, and our dedicated teams remain available to provide support and assistance. Please reach out to your OIA Global representative if you require any guidance or support during this challenging period.

What we’re seeing in the market

  • Shortages will impact space and container availability in Asia as the Chinese New Year approaches.
  • Rate increases and additional charges: GRI, PSS, and other surcharges should be expected. Carriers are responding quickly, with higher rates for expedited services, based on their experience during the global pandemic.
  • Service reliability will be challenged due to unexpected changes and/or cancellations.

Panama Canal

The Panama Canal Authority (PCA) has implemented measures to increase transit slots and  address the impacts of an unprecedented drought:

  • Recycling water from one lock chamber to the next chamber.
  • Allowing two vessels to transit simultaneously in one chamber.

Despite these measures, daily capacity continues to drop.

How carriers are responding

Carriers are introducing premium services, surcharges, GRI, and vessel re-routing.

  • The 2M alliance (MSC & Maersk) maintains a high priority on Panama Canal usage for all their services.
  • The Ocean Alliance (CMA-CGM, OOCL, Cosco, Evergreen) has priority for specific services; however, the alliance has re-routed most shipments around the Cape of Good Hope to avoid disruption in the Suez Canal. OOCL diverted services include ECX 1/2, GCC 1/2, and ECC 1/2/3.
  • The Alliance (HL, HMM, ONE YM) diverted EC1, EC2, and EC6 services around the Cape of Good Hope to avoid disruption in the Suez Canal.
  • ZIM and ZXB rerouted services around the Cape of Good Hope, with ZEX fast service to USWC and MLB to USEC.

Bottlenecks in the canal have delayed shipments by 5-7 days, and re-routed ships via the Cape of Good Hope have delayed shipments by 10-14 days.

Suez Canal

In November ‘23 Houthi rebels in Yemen began attacking cargo ships en route via the Suez Canal. This disruption prompted carriers to pause their Red Sea routes and instead take a longer journey around Africa’s Cape of Good Hope to ensure the safety of the crew, ship, and cargo.

How carriers are responding

Carriers are introducing GRI and PSS rates, creating new market conditions and force majeure surcharges, and adding more vessels to sustain longer routes around the Cape of Good Hope. All carriers are increasing ad-hoc and FAK rates.

  • CMA-CGM and HL declared force majeure.
  • ONE, ZIM, and Evergreen are implementing additional surcharges, such as GRI, PSS, and emergency surcharges.

FEWB services have delayed shipments for up to 10 days, while TPEB services have delayed shipments for up to 14 days. Shippers should also expect additional weather-related delays.