Disruptions Impact Shipping Outlook

Ship backups that plagued seaports during the Covid pandemic are making a comeback, raising concerns about new delays and higher costs during this year’s peak shipping season.

Flotillas of containerships and bulk carriers are forming off the coasts of Singapore, Malaysia, South Korea and China while ports in Spain and other parts of Europe look to dig out from container piles.

The WSJ’s Costas Paris and Paul Berger report the backups are the result of vessel diversions because of attacks by Yemen’s Houthi rebels on commercial ships in the Red Sea that have disrupted shipping schedules and left shipments and sea containers out of sync.

The snags are complicating logistics for retail and manufactured goods, but the bigger concern is that backups could expand as demand picks up heading into the busy peak shipping season. Experts say some shippers are already booking earlier to get ahead of the congestion.

• Ikea wants to boost production in the U.S. and the Americas because of escalating shipping disruption and a “permanent shift” away from seamless global trade. (Financial Times)
• Drewry says new capacity inserted in container shipping lanes out of Asia is being completely absorbed by growing demand and longer voyages. (Journal of Commerce)