
Following the announcement of a Gaza ceasefire deal, industry experts are questioning whether the Suez Canal, a historically critical pathway for major global trade routes including Europe-Asia trade, will resume its role in transporting billions of dollars worth of commodities.
Insights from Matt Castle, Vice President of Global Forwarding at C.H. Robinson, featured globally in Reuters, Yahoo! News, The Economic Times, and Daily Mail, shed light on the prevailing uncertainty. Castle noted, “It’s not likely the industry will see a large shift back to the Suez Canal in the short term, which previously accounted for 30% of global containerized trade before the conflict arose. This is primarily due to two reasons: challenges related to securing cargo insurance given perceived high risks and time constraints given it takes weeks or months to implement a new ocean shipping plan. Even if carriers decide to revert to the old route, it will take some time to implement, especially with ongoing carrier alliance reshuffling disrupting schedules.”
Castle continued, “When vessels initially rerouted to the Cape of Good Hope, we assisted thousands of customers affected by the extended transit times. If another shift occurs, we will continue to provide support and alternative options to our customers based on their needs and goals. The future use of the Suez Canal for trade remains uncertain, but uncertainty is a common aspect of global shipping. Our teams manage 6,000 ocean and air shipments daily, so we are well-versed and prepared for such changes.”
As shippers await further developments, Castle advises discussing inventory levels and potential impacts on storage space in the event of future changes in transit times. “For example, if vessels return to the Suez Canal, some shippers could experience goods arriving in close succession as the transition begins.”
Read more Freight Market Insights from C.H. Robinson.
About C.H. Robinson
C.H. Robinson delivers logistics like no one else™. Companies around the world look to us to reimagine supply chains, advance freight technology, and solve logistics challenges—from the simple to the most complex. 83,000 customers and 450,000 contract carriers in our network trust us to manage 37 million shipments and $23 billion in freight annually. Through our unmatched expertise, unrivaled scale, and tailored solutions, we ensure the seamless delivery of goods across industries and continents via truckload, less-than-truckload, ocean, air, and beyond. As a responsible global citizen, we make supply chains more sustainable and proudly contribute millions to the causes that matter most to our employees. For more information, visit us at chrobinson.com (Nasdaq: CHRW).