The Ever Given ship, almost as long as the Empire State Building is high, is blocking canal transit in both directions.
Egypt’s Suez Canal Authority (SCA) said it was temporarily suspending navigation through one of the world’s busiest shipping lanes until the grounded container vessel MV Ever Given is refloated.
The announcement on Thursday came after low tide overnight slowed efforts to dislodge the massive vessel that has choked traffic in both direction along the canal and created one of the worst shipping jams seen in years.
The Ever Given vessel ran aground diagonally across the single-lane stretch of the southern canal on Tuesday morning after losing the ability to steer amid high winds and a dust storm, according to SCA.
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The former EU ambassador to Egypt has said the crisis at the Suez Canal could prove to be “very costly”.
“Each day people have made estimates that between $8-10 billion of trade is going through the Suez Canal – absolutely fundamental for European supply chains,” James Moran told Al Jazeera.
“It’s not just about oil,” he said, adding the goods coming from the far east, including China, where “just as important”.
The suspension of traffic through the Suez Canal has deepened problems for shipping lines that were already facing disruption and delays in supplying retail goods to consumers, shipping sources said according to Reuters news agency.
Container shipping companies, carrying retail goods ranging from mobile phones and designer goods to bananas, have been struggling for months with disruptions caused by the coronavirus pandemic and a surge in demand for retail goods that led to wider logistical bottlenecks around the world.
In the latest challenge, more than 30 container ships are unable to sail after the 400-metre (430-yard) Ever Given boxship ran aground in the Suez Canal, blocking transit, the sources said.
A container ship blocking the Suez Canal like a “beached whale” sent new shockwaves through global trade on Thursday as officials stopped all ships entering the channel and the salvage company said it may take weeks to free.
The 400m (430-yard) Ever Given, almost as long as the Empire State Building is high, is blocking transit in both directions through one of the world’s busiest shipping channels for oil, agricultural products, and manufactured goods trade linking Asia and Europe.
The Suez Canal Authority (SCA) said eight tugs were working to move the vessel, which got stuck diagonally across the single-lane southern stretch of the canal on Tuesday morning amid high winds and a dust storm.
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Two professional rescue teams from the Netherlands and Japan will work with local authorities to design a more effective plan to refloat the Ever Given container ship, the company leasing the ship said.
Taiwan’s Evergreen Marine Corp said Smit Salvage from the Netherlands and Nippon Salvage from Japan had been appointed by the shipowner and would work alongside the captain and the Suez Canal Authority.
Lars Jensen, a Denmark-based maritime expert, said that if the Ever Given container ship remains stuck, the impact on global trade could be huge.
“With a cork being put in the Suez Canal,” vessels heading towards the northern European ports are being blocked, said Jensen, chief executive of SeaIntelligence Consulting.
When “the cork comes out, it is almost like a ketchup bottle, then you get both: all the vessels in the queue and the additional normal vessels coming into the northern European ports at the same time,” which will make a “massive congestion problems in the European ports, say a week to two weeks from now,” he explained.
Egypt has announced the reopening of the two Mediterranean ports of Alexandria and Dekheila, which were shut on Wednesday, after weather conditions improved, the Alexandria Port Authority said in a statement.
The ports are among the biggest in Egypt and each can handle a maximum of 1 million 20ft-equivalent units (TEUs).
Four Egyptian Red Sea ports had been shut on Tuesday, also due to weather conditions, but all were re-opened by late on Wednesday.
Lawrence Brennan, a professor of admiralty and international maritime law at Fordham university, said physical damage of the ship could lead to a long-term blockage of the canal.
“[Ship-owners must asses] whether there is any further damage. The photographs from yesterday show the ship hard aground and that the stern is afloat. And that could possibly cause additional damage to the ship,” Brennan told Al Jazeera.
“If this ship were to break in half and could not be refloated and removed, that would lead to a long-term blockade of the canal in its present position.”
Egypt’s Suez Canal, where frantic efforts are being made to free a giant container ship, opened 150 years ago.
Since then, it has been regularly expanded and modernised and today is capable of accommodating some of the world’s largest supertankers.
Here is a look back at key stages in the enlargement of the waterway, which handles roughly 10 percent of international maritime trade.
Toshiaki Fujiwara, an official at Shoei Kisen Kaisha, the company that owns the vessel, told AFP news agency “we still don’t know how long it will take” to refloat the ship.
“We have not heard of any particular progress. Now they are trying to dig out dirt under the bow of the vessel. They will resume tug operations when the tide rises,” he added.
He said the ship had an insurance policy, but that the firm was unaware of the details or any costs involved at this stage.
“It’s just the beginning,” Fujiwara said.
A back-of-the-envelope calculation shows there’s about $9.6 billion worth of daily marine traffic halted by the massive container vessel that lodged in the Suez Canal earlier this week, blocking transit in both directions.
The figure is based off an assessment by Lloyd’s List that suggests westbound traffic is worth around $5.1 billion a day and eastbound traffic approximately $4.5 billion.
The industry journal concedes that these are “rough calculations,” however.
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Canal service provider Leth Agencies said at least 150 were waiting for the Ever Given to be cleared, including vessels near Port Said on the Mediterranean sea, and the port of Suez on the Red sea as well as those already stuck on Egypt’s Great Bitter Lake.
The Suez Canal Authority said it has temporarily suspended traffic while eight tugs work to free the stranded vessel.
Thirteen ships had sailed south along the canal on Wednesday and were waiting in lakes until the container ship Ever Given is released, the authority said in a statement.
Egypt’s Suez Canal handles about 10 percent of international maritime trade and is one of the world’s busiest waterways, providing a crucial link for oil, natural gas and cargo shipping between the Atlantic Ocean and the Pacific Ocean.
When opened more than 150 years ago, the canal was 164km (102 miles) long and eight metres (26 feet) deep, but after several expansions throughout the years, it is now 193km (120 miles) long and 24 metres (78 feet) deep.
The canal remains one of Egypt’s top foreign currency earners.
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The Japanese owner of the ship has apologised for the incident and the “tremendous worry” it has caused to the other vessels and their involved parties.
Shoei Kisen said it is cooperating with its technical management company and the local authorities to get the ship afloat, but “the operation is extremely difficult”.
“We are extremely sorry for causing tremendous worry to the ships that are traveling or schedule to travel in the Suez Canal, and all the related people.”
Efforts to dislodge the 400-metre long container vessel have resumed at high tide on Thursday, with tugs working to drag the vessel to deeper water, according to ship-tracking data.
Ship-tracking software shows five tugs surrounding the Ever Given and three more heading towards it.
At least 150 other vessels needing to pass through the crucial waterway idled waiting for the obstruction to clear, authorities said.
Oil prices sank more than one percent a day after soaring seven percent in reaction to the ship getting stuck in the Suez Canal.
Crude, which tipped a 14-month high earlier this month, has suffered heavy selling in the past couple of weeks on fears about the impact on demand caused by new European lockdowns.
Axi strategist Stephen Innes said the Suez blockage “means increased oil on the water – either queuing for the canal or diverting around Africa. The extra voyage time is akin to ‘filling a pipeline’ and should support the very jittery market that has seen the rush for the door over the past five sessions”.
Ship-tracking software shows that the Ever Given has made only minor changes to its position over the past 24 hours, despite the deployment of several tugs to drag it to deeper water, Reuters reported.
Several dozen vessels, including other large container ships, tankers carrying oil and gas, and bulk vessels hauling grain have backed up at either end of the canal to create one of the worst shipping jams seen for years.
Roughly 30 percent of the world’s shipping container volume transits through the 193 km (120 miles) Suez Canal daily, and about 12 percent of total global trade of all goods.
— Erin Holmes 🏴☠️ (@ErinJHolmes) March 25, 2021
Shipping experts say that if the blockage is not likely to be cleared within the next 24-48 hours, some shipping firms may be forced to re-route vessels around the southern tip of Africa, which would add roughly a week to the journey.
But the chairman of the Suez Canal Authority told media that despite the blockage some cargo was able to move south and that efforts to dislodge Ever Given would continue.
“Once we get this boat out, then that’s it, things will go back to normal. God willing, we’ll be done today,” Chairman Osama Rabie said.