İMEAK Chamber of Shipping warns of imminent surges in global freight costs amid ongoing attacks in Gaza and Houthi assaults on the Suez Canal. Recent disruptions prompt major shipping companies to reroute vessels, reflecting a critical shift reshaping trade dynamics and fueling concerns over potential disruptions in supply chains and soaring food prices.

In the wake of Israel’s ongoing attacks on Gaza and Houthi retaliatory attacks on the Suez Canal, Yusuf Öztürk, Chairman of the Board of Directors of the İzmir Branch of İMEAK Chamber of Shipping, has issued a critical warning about the looming threat of soaring freight costs in the world's maritime trade. Öztürk emphasizes, "Although some container operators are redirecting their routes to the Red Sea due to the sea power established under the leadership of the United States, it is expected that delays and additional costs will cause serious difficulties in every stage of the global supply chain, from oil and energy supply to manufacturing and retail trade. In any case, we need to be prepared for high freight rates." Recent attacks in the Suez Canal, a vital passage responsible for 12% of global trade and 30% of total container traffic, have prompted major shipping companies like Maersk, MSC, and CMA CGM to reroute their vessels.

Yusuf Öztürk | Chairman of the Board of Directors of the İzmir Branch of İMEAK Chamber of Shipping

Öztürk highlights the severity of the situation, stating that the Suez Canal, being a critical waterway where 12% of global trade and 30% of total container traffic pass through, is of paramount importance. He further explains that these rerouting decisions, influenced by safety concerns and geopolitical tensions, are reshaping global trade dynamics and may lead to disruptions in supply chains and potential food price surges.

The Chairman emphasizes the economic ramifications of this shift, with ships changing their routes leading to a 10-14 day extension in arrival times and an average additional fuel cost of approximately one million dollars. He points out that while some container operators are redirecting routes to the Red Sea under the influence of the United States-led maritime power, this strategic move is expected to result in serious difficulties across the global supply chain.

Reflecting on the broader implications, Öztürk underlines the role of ship owners in finding solutions, stating, 2024 will be a year when many ships will be launched, and there will be significant problems in the maritime sector. The potential domino effect of these disruptions, coupled with the impact on inflation and the high-interest policies of advanced countries, poses challenges to Turkey's fight against inflation in the medium and long term.

As the world navigates through these challenging times, the maritime industry braces itself for high freight rates, and stakeholders are urged to stay vigilant amid the evolving dynamics of global trade.

Öztürk concludes, "These developments, much like the pandemic, may position our country as a supply center for a short period. However, in the medium and long term, it is expected to negatively impact our fight against inflation. We hope and wish that the world economy returns to normalcy before reaching the brink of a new deadlock.”