Giant vessel blocking Suez Canal holds up $9.6B a day worth of traffic

Tugboats and a specialised suction dredger continue to work to dislodge a giant container ship that has been stuck sideways in Egypt's Suez Canal for the past three days, blocking a crucial waterway for global shipping.

The Ever Given, a Panama-flagged ship that carries cargo between Asia and Europe, ran aground in the narrow canal that runs between Africa and the Sinai Peninsula. It got stuck in a single-lane stretch of the canal, about six kilometres (3.7 miles) north of the southern entrance, near the city of Suez.

In a clear overture, Turkey has offered to with the Suez Canal jam, Turkish Transport Minister Adil Karaismailoglu said on Friday.

Lloyd's List said the blockage was holding up an estimated $9.6 billion worth of cargo each day between Asia and Europe.

"Rough calculations suggest westbound traffic is worth around $5.1 billion daily while eastbound traffic is worth $4.5 billion," said Lloyd's.

Backlogs and blocked oil and gas shipments

The ship, owned by the Japanese firm Shoei Kisen KK, has blocked traffic in the canal, causing headaches for global trade.

Around 10 percent of world trade flows through the canal, which is particularly crucial for the transport of oil. The closure also could affect oil and gas shipments to Europe from the Mideast.

At least 150 ships were waiting for the Ever Given to be cleared, including vessels near Port Said on the Mediterranean Sea, Port Suez on the Red Sea and those already stuck in the canal system on Egypt’s Great Bitter Lake, said Leth Agencies, which provides services for the canal.

Internationally, many are getting ready for the effect that the shipping pause will have on supply chains that rely on precise deliveries of goods. Singapore’s Minister of Transport Ong Ye Kung said the country’s port should expect disruptions.

“Should that happen, some drawdown on inventories will become necessary,” he said in a Facebook post.

The backlog of vessels could stress European ports and the international supply of containers, already strained by the coronavirus pandemic, according to IHS Markit, a business research group. 

It said 49 container ships were scheduled to pass through the canal in the seven days following Tuesday when the Ever Given became lodged.

As of Friday morning, the vessel remained grounded, Leth Agencies added. It remains unclear when the route would reopen.

READ MORE: Suez Canal suspends traffic as tugs work to free giant stranded ship

Turkey offers help

Turkey can send its Nene Hatun vessel to help resolve a blockage on the Suez Canal, Transport Minister Adil Karaismailoglu said on Friday, amid a recent push by Ankara to repair its strained ties with Egypt.

"We have conveyed our offer to help to our Egyptian brothers and if a positive response comes from them, our Nene Hatun ship is among the few in the world that can carry out work of this nature," Karaismailoglu told broadcaster NTV, adding Ankara had not received a response yet but was ready to act.

Earlier this month, Turkey said it had resumed contacts with Egypt. Ties have been frosty since Egypt's army toppled a Muslim Brotherhood president close to President Tayyip Erdogan in 2013.

Rescue efforts 

An Egyptian official at the Suez Canal Authority described the work as complex and said those trying to dislodge the vessel wanted to avoid complications that could extend the canal closure. The official spoke on condition of anonymity as he was not authorised to talk to journalists.

The Ever Given's bow was touching the eastern wall, while its stern appeared lodged against the western wall.

A team from Boskalis, a Dutch firm specialised in salvaging, started working with the canal authority on Thursday. The rescue efforts have focused on dredging to remove sand and mud from around the port side of the vessel’s bow.

The Suez Canal Authority, which operates the waterway, deployed tugboats and a specialised suction dredger that is able to shift 2,000 cubic meters of material every hour.

The Suez Canal Authority said late Thursday that it would need to remove between 15,000 to 20,000 cubic meters (530,000 to 706,000 cubic feet) of sand to reach a depth of 12 to 16 meters (39 to 52 feet). That depth is likely to allow the ship to float freely again, it said.

It wasn’t immediately clear what caused the Ever Given to become wedged on Tuesday. GAC, a global shipping and logistics company, said the ship had experienced a blackout without elaborating.

READ MORE: Suez traffic redirected to old channel as skyscraper-sized ship stranded

Bad weather

Evergreen Marine Corporation, a major Taiwan-based shipping company that operates the ship, said in a statement that the Ever Given had been overcome by strong winds as it entered the canal from the Red Sea, but that none of its containers had sunk.

The Suez Canal Authority also blamed bad weather for the incident.

Using data from Automatic Identification System trackers on ships at sea, data firm Refinitiv shared an analysis with the AP showing that over 300 ships remained en route to the waterway over the next two weeks.

Some ships now may be changing course to avoid using the Suez Canal. The liquid natural gas carrier Pan Americas changed course in the mid-Atlantic, now aiming south to go around the southern tip of Africa, according to satellite data Friday from MarineTraffic.com.

The Ever Given was involved in an accident in northern Germany in early 2019, when the freighter ran into a small ferry that was moored on the Elbe river in the port city of Hamburg. 

No passengers were aboard the ferry at the time and there were no injuries, but the collision caused serious damage to the boat.

Hamburg prosecutors opened an investigation of the freighter’s captain and pilot on suspicion of endangering shipping traffic but shelved it in March 2020 for lack of evidence, spokesperson Liddy Oechtering told The Associated Press on Friday.

It was not immediately clear whether the two suspects at the time were part of the crew involved in the Suez incident.

Oechtering also could not say what the investigation had determined the cause of the 2019 crash was, but officials at the time suggested that strong winds may have blown the slow-moving freighter into the ferry.

READ MORE: What the closure of the Suez Canal costs global trade