Container lines will not restart Suez Canal crossings until May at the earliest, believes Yang Ming chairman Tsai Feng-ming.
At the National Association of Chinese Shipowners’ Chinese New Year celebration on Friday, Dr Tsai said that while Israel and Hamas had reached a ceasefire on 19 January, shipping companies were still monitoring the situation to see if it would hold.
Dr Tsai said: “Even if the war ends in the next 60 days, it will take at least another three months to normalise supply and demand. Any decision to return to the Red Sea will have to be made by the alliance partners.”
Yang Ming is part of the Premier Alliance, which rebranded from THE Alliance on 1 February.
Dr Tsai believes 2025 could present a new set of challenges for the industry, including a glut of tonnage should Suez crossings resume, and US President Donald Trump’s tariffs on Chinese imports meant more uncertainties in global supply chains.
He said: “The first half of the year must be observed with caution. If the Red Sea crisis is resolved and vessel supply exceeds demand, everyone will speculate about the impact on freight rates. How shipping companies respond to this and adjust to freight rate fluctuations will affect the market.”
Ahead of the hostage exchange on 30 January, Suez Canal Authority (SCA) president Osama Rabie invited representatives from more than 20 liner operators to a meeting, urging them to resume Red Sea transits.
SCA lost nearly $7bn in revenue last year as vessels rerouted around the Cape of Good Hope to avoid Houthi attacks.
CMA CGM Egypt and Sudan cluster CEO Tariq Zaghloul said consistent stability would be necessary for the French liner to consider restoring all Suez transits, and Port Said Chamber of Shipping chairman Adel Ellameey said insurers must be on board as well, as ships could only sail through the canal if the insurers re-classified the area as safe.
Dr Tsai emphasised that safety would be the key factor in assessing a return to the Red Sea. He said: “Shipping companies are still observing political changes. Even after the war between Israel and Palestine ends, geopolitics will affect the subsequent three months.”
And, on US-China trade tension, Dr Tsai said he believed Mr Trump would introduce more policies.
Source: By Alison Koo, The Loadstar
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