The world's two leading shipping lines impose surcharges due to tensions in the Red Sea

The world's two leading container shipping lines, Maersk (Denmark) and CMA CGM (France), decided to apply transportation surcharges, after rerouting vessels due to concerns about the threat of attack by the Houthi rebel group in the Red Sea.

Maersk and CMA CGM are among the shipping lines that have suspended shipping through the Red Sea adjacent to the Suez Canal - the fastest sea route between Asia and Europe, due to the complicated security situation in this sea.

The Houthi rebel group from Yemen has threatened to attack any vessel passing through the Red Sea and heading to Israel, vowing to stop this only when Israel cedes some rights to the Palestinian people in the Gaza Strip.

According to the Reuters news agency, citing "severe operational disruptions", Maersk issued a notice late on December 21st, 2023 about additional fees including: Transportation disruption surcharge (TDS) takes effect immediately; and peak season surcharge (PSS) is applied from January 1st, 2024.

Surcharges are applied because vessels will have to travel longer distances.

Specifically, these Shipping lines are directing their vessels around the Cape of Good Hope at the southern tip of Africa, causing the journey from China to Northern Europe (which normally takes about 27 days) to extend by 10 days.

They said cancellations and fare increases are expected to continue in the first quarter of 2024, so they recommend customers should book vessels 4-6 weeks in advance.

According to Maersk, a standard container 20 feet will incur a total surcharge of $700, including $200 for TDS and $500 for PSS.

CMA CGM announced a surcharge of 325 USD for container 20 feet on the Northern Europe to Asia route, and 500 USD from Asia to the Mediterranean.

Excerpt from the article: The world's two leading shipping lines impose surcharges due to tensions in the Red Sea