News

It would be a fair statement that the start of 2024 has been anything but quiet, and our stability temperature monitor is edging ever closer to code red.

At the inception of this advisory, the headline read “Red Sea crisis enters hibernation mode”; however, this headline is clearly no longer reflecting the latest development.

Scan Global Logistics continues to expand its presence in Europe by opening a new office in Marseille, marking its fourth establishment in France since its initial opening in Lille in 2021. This new office provides direct access to France's second-largest commercial port area, and trade routes to Asia, particularly China and the USA, will be of primary importance initially. However, the port's direct connectivity to Africa and the Middle East presents significant business prospects in these regions.

As we enter day 24 of the Red Sea crisis, the situation is as such unchanged, with the industry having grown accustomed to utilising routing via the Cape of Good Hope in the wake of Houthi attacks on commercial vessels in the Red Sea.

Although three major ocean freight alliances are in place for sharing vessel capacity, recent events have made it painfully apparent that this does not translate into consistency in risk assessments, routing decisions, and schedule reliability. Most apparent has been the limbo dance performed by Maersk, which, in recent days, has completed a U-turn on the decision to once again transit through the Red Sea and Suez Canal. 

Following the Christmas holidays, the situation in the Red Sea remains fluid and uncertain. It is also clear that carriers are currently divided in their risk assessment, providing an overall blurry picture of the situation.

Overall, the situation is unchanged in the sense that container carriers continue to re-route vessels utilising the extended route around the Cape of Good Hope. While a military coalition has been formed, it currently remains unclear as to when this will have an effect, allowing vessels to pass through the Red Sea safely.

We kick off 2024 with a fresh take on the current market outlook considering recent market developments.

Following our ocean market update published on 18 December informing of the consequences of missile attacks on vessels passing through the Red Sea, we continue to monitor the situation closely and wish to update you on the latest developments.