The Impact of Houthi Attacks on Red Sea Shipping and the Suez Canal

The Red Sea—one of the world’s most critical intermodal corridors—has faced sustained disruption since late 2023 as attacks on merchant vessels prompted widescale rerouting. The fallout has reshaped schedules, insurance costs, and ocean capacity planning, with lasting implications for the Suez Canal and global supply chains in 2025.

What Changed and Why It Matters

In the first two months of 2024, Suez Canal trade fell by about 50% year over year, according to the International Monetary Fund. By mid-2024, Egypt’s authorities and international media documented steep declines in ship transits and revenue as carriers detoured around Africa’s southern tip. The IMF later estimated Suez foreign-exchange inflows fell by roughly US$6 billion in 2024. Source 1, Source 2, Source 3, Source 4.

Rerouting Around Africa: Time and Distance

The most common alternative has been the Cape of Good Hope. For example, a Shanghai–Rotterdam voyage typically spans about 10,500–10,600 nautical miles via Suez (around 3–4 weeks depending on speed and port windows). The Cape route adds ~3,200 nm and roughly a week at typical liner speeds, which ripple through schedules, bunker costs, and box availability. Source 5, Source 6.

Measured Impacts

• IMF PortWatch flagged a ~50% YoY drop in Suez trade volumes early 2024; multiple outlets later reported canal revenues down nearly two-thirds for the year. Source 7, Source 3.
• Some analyses show Cape arrivals up ~74% in early 2024 compared with pre-crisis baselines, underscoring a large-scale diversion. Source 8 (PDF).
• Monthly snapshots in May 2024 captured traffic and revenue plunges: ~1,111 transits and receipts near $338 million, down sharply year-on-year. Source 9.

Knock-On Effects Across Intermodal Networks

Route deviations increase round-trip time, soak up vessel capacity, and elevate insurance and charter rates. Inland stacks and depot turn-times also shift as Asia–Europe flows lengthen. For beneficial cargo owners and NVOs, that’s meant longer cycle times and tighter equipment in certain corridors through 2025.

Operator Mitigations and Policy Responses

• Dynamic scheduling & slow steaming: Balancing bunker consumption and transit reliability while adjusting port calls.
• Insurance & security premiums: War-risk surcharges and security protocols elevated on Red Sea legs.
• SCA pricing actions: The Suez Canal Authority has periodically offered targeted discounts to lure services back, though risk calculus continues to favor the Cape for many loops during elevated threat periods. Source 10.

What 2025 Looks Like

With tensions persisting, many mainline services have planned for structural variability through 2025. Shippers should expect rolling schedule updates, lane-specific surcharges, and longer buffers on time-sensitive freight. Diversions are likely to ebb and flow with risk levels and insurance pricing.

Practical Tips for Shippers and Site Buyers

• Buffer lead times: Build additional transit slack for Asia–Europe and any trades reliant on Suez timing.
• Flex equipment strategy: If you’re planning on-site storage or project builds, secure a shipping container early to avoid seasonal tightness. See our products page.
• Risk-aware delivery: For U.S. deployments, review placement and lead times with our Shipping Container Delivery team.

Where We Deliver in the U.S. (Selected Hubs)

We serve all continental U.S. locations. If you’re near major ports or inland hubs, check regional pages:

• East Coast: New Jersey (see Newark), Virginia (see Norfolk), Georgia (see Savannah).
• Gulf & South: Texas (see Houston, Dallas), Florida (see Miami, Tampa).
• West Coast: California (see Long Beach, Oakland), Washington (see Seattle, Tacoma).

FAQs

Are detours still common in 2025?

Yes—carriers continue to adjust on a loop-by-loop basis, weighing risk exposure, insurance, and seasonal demand. Expect variability to persist until risks in the Red Sea materially ease. IMF overview.

How much time does the Cape route add?

On Asia–Europe rotations, detouring via the Cape typically adds about 3,000+ nautical miles and roughly a week at common service speeds, though port windows and slow steaming can extend that further. Route analysis.

Why does Suez matter beyond Asia–Europe trades?

Schedule reliability and equipment positioning on one trunk lane affect intermodal flows globally, influencing box availability and rates on adjacent services.

Key Takeaway: Intermodal Planning in a Prolonged Red Sea Disruption

The combination of elevated risk, longer rotations via the Cape, and cost pass-throughs means shippers should plan conservatively in 2025. Build time buffers, diversify routings where possible, and lock in equipment early. If you need an on-site shipping container for storage or project staging, you can Get A Quote or call 800-223-4755 to discuss availability and delivery timing.

Data sources referenced: IMF PortWatch and blog analyses on Red Sea disruptions; Suez Canal traffic and revenue snapshots; Cape route distance/time comparisons. See citations above for details.