The recent attacks on ships in the Red Sea by Houthi rebels in Yemen have sent shockwaves through the global trade industry, further exacerbating the existing challenges posed by port congestion and the Russian invasion of Ukraine. With cargo ships being targeted, the Suez Canal has been forced to shut down, causing disruptions in traffic and rerouting ships around the tip of Africa. These disturbances are resulting in delays and increased costs at a time when the world is still grappling with economic inflation.
Ryan Petersen, the CEO of supply chain management company Flexport, describes the current situation as 'short-term chaos' that leads to heightened expenses. He highlights that each rerouted ship carries approximately 10,000 containers, necessitating extensive communication and planning to adjust the journeys of these containers.
