Business fears new supply crisis due to tensions in the Red Sea
Geopolitical tensions on the Red Sea route have reactivated all alarms in the face of a new supply crisis, leading to a halt in activity once again. The worst ghosts of Ukraine’s post-pandemic and war-ravaged blockade have resurfaced in recent weeks. And Spanish companies are starting to take notice.
Transit through the canal has fallen to its lowest level in four years, despite the fact that traffic represents 15% of world trade and 30% of global container ship volume.
In this difficult environment, Lorenzo Amor, President of ATA and Vice-President of the CEOE, expressed this Tuesday his concern about the impact on inflation, as shipping companies look for alternative routes, which on many occasions. The cost of freight increases.
“It’s true that we have overcome inflation, but there are concerns about what could happen,” Amor said, recalling that inflation in Spain had started rising not with the war in Ukraine, but when It started when components and supplies started disappearing from companies. .The prices of the Spanish and their transportation increased.
Manufacturers and distributors have also expressed their concern in this regard through their employer association ACOCK. “The conflict has forced insurance companies to raise premiums for companies or even refuse to insure goods passing through this route,” he warned on Monday.
These companies – which include key sectors such as food, textiles and fashion, hardware and DIY, technical consumer goods – fear a new increase in costs, warning that “they are already facing shortages in some raw materials and even “We are facing difficulties in supplying products.” Finishing such as textiles and furniture. Therefore, they have started taking measures, hoping to purchase some products.
According to the data collected, the main shipping companies are adopting the Southern African route as an alternative, which increases the journey duration by about 10 days, resulting in increased fuel consumption and navigation time. This scenario is causing the price of containers for this route to triple, going from 1,000 euros to 3,000 euros per container.