Suez Canal toll earnings have taken a dive as vessels re-route around the Cape of Good Hope, but the influence of the situation on the various cargo markets has been mixed.
An analysis from Veson Nautical shows toll fees falling around 40% since the end of November from $47m to $28m.
Rebecca Galanopoulos Jones, Veson senior content analyst said the container tolls have significantly decreased, falling by 66% from the end of November, where estimated fees fell to $6m at the beginning of January.
The LPG sector experienced the biggest drop with tolls down by 93%, as toll revenues fell from $1m at the end of November to just $153,000 in the first week of January.
LNG tolls ranked third, with a fall of 66% followed by crude tankers which experienced a fall of 23% from $7.3m to $5.7m in January. Bulkers were the least affected, with a comparatively modest decline of about 7%.
According to Veson Nautical’s analysis, there has been a significant decline month on month of approximately 38% in the sum of weekly calculated Suez Canal net tonnage (SCNT) through the Suez Canal, while the sum of SCNT going around the Cape of Good Hope has increased by about 25%.
This shift is due to a surge in attacks targeting vessels in the region, forcing ship operators to alter their routes. The consequences of these alterations include increased costs (including rising oil prices), shipment delays, threats to maritime security and concerns about geopolitical instability.
However, the influence of the situation on the various cargo markets has been mixed, as Veson Nautical reports.
“In the crude tanker sector, rates for suezmaxes and aframaxes have firmed since the start of December, up by around 16% and 63% respectively.
“The route around the Cape of Good Hope more than doubles the length of voyages from the Middle East to Europe and therefore reduces the supply of available tonnage in the market,” Rebecca Galanopoulos Jones, Veson senior content analyst said.
In the container sector, the diversion has reversed a steady downward trend in freight rates since 2022. A large number of vessels have diverted from the Red Sea to travel around the Cape of Good Hope, and this has also led to increasing earnings with post-panamax period rates for one-year up by 7% from December.
Although the impact on the bulker sector is significantly lower than for other markets despite the usual dip in earnings during January, Galanopoulos-Jones says rates have remained historically high for this time of the year, even after a decrease from the peak in December.
As the senior analyst forecasts, the reduced traffic through the Suez Canal and therefore a lower income from toll fees is likely to persist for the foreseeable future.
