© Bloomberg. Tug boats pull the Ever Given container ship along the Suez Canal after being freed from the canal bank in Suez, Egypt, on Monday, March 29, 2021.
(Bloomberg) — Ships started moving again through the Suez Canal on Monday after the giant container ship that lay stranded across the critical waterway for a week was finally tugged free.
Hundreds of vessels carrying everything from oil to livestock were forced to wait in line after the Ever Given got stuck in the canal. The accident was a stark reminder of the fragility of global trade infrastructure and threatened to strain supply lines already stretched by the pandemic.
Horns sounded in celebration as the container ship — which is longer than the Eiffel Tower and weighs 220,000 tons — limped up the canal after a painstaking rescue operation that saw teams of tugs and dredgers working day and night.
Salvage teams used the tides and a full moon to pull it from deep inside the sandy bank it had smashed into last week amid high winds and poor visibility. They shoveled 30,000 cubic meters of sand and removed part of the canal wall.
Part of the problem was a five-day wait for two large tugboats, according to Peter Berdowski, chief executive officer of Boskalis Westminster, the parent company of the salvage team.
“We were enormously helped by the strong tide, the forces of nature that push hard, even harder than the two tugboats can pull,” he told Dutch radio.
“The men were euphoric of course. But there was a tense moment when this giant was floating freely. You need to bring it under control quickly with the tugboats before it gets stuck on the other side, we would have gone from bad to worse. Those were a tense 10 minutes.”
The Suez Canal Authority said it could take around a week to clear the queue of ships. On Monday evening, at least three ships were on the move, according to vessel-tracking data.
Egyptian authorities were desperate to get traffic flowing again through the waterway that’s a conduit for about 12% of world trade and about 1 million barrels of oil a day. This has been the canal’s longest closure since it was shut for eight years following the 1967 Six Day War.
Firms including A.P. Moller-Maersk A/S and Hapag-Lloyd AG were forced to reroute their ships via the southern tip of Africa, which can add two weeks on to a journey between Europe and Asia. At least one ship appeared to do a double U-turn on Monday as news of the salvage operation emerged.
Dominoes Have Toppled
The long-term impact of the canal’s $10-billion-per-day closure will likely be small given that global merchandise trade amounts to $18 trillion a year. Yet so many ships being thrown off schedule will ensure cargo delays for weeks, if not months. The dozen or so container carriers that control most of the world’s ocean freight are already charging record-high rates on some routes, and shortages of everything from chemicals and lumber to dockside labor already abound.
“The dominoes have been toppled,” Lars Jensen, chief executive of SeaIntelligence Consulting in Copenhagen, wrote on social media over the weekend. “The delays and re-routing which have already happened will cause ripple effects” which will be felt for several months.
Companies from Ikea to Caterpillar Inc (NYSE:). flagged potential impacts and tens of thousands of live animals are stuck on ships in the area. Consumer goods, industrial inputs, and commodities from oil to coffee are caught up in the jam, with Asian exporters and European importers affected most directly.
The blockage held up about $400 million an hour, based on rough calculations from Lloyd’s List that suggested westbound traffic to Europe is worth around $5.1 billion a day and eastbound traffic is approximately $4.5 billion.
(Updates with traffic resumes)
©2021 Bloomberg L.P.
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