Shipping lines preferred their vessels' access to the Red Sea region and the Suez Canal. However, since the end of 2023, they have been forced to avoid the Red Sea region due to the rising tensions there. Shipping companies have had to change their routes by going through the Cape of Good Hope which serves as an alternative pathway.
Nevetheless, navigating this route involves a much longer journey around 10-14 days compared to before, incurring many more shipping costs, leading to increased shipping prices and a possible shortage of containers.
According to statistics from Drewry, an independent maritime research consultancy offering market insights and advisory services to senior stakeholders across global shipping, the price of container transport services from Asia to Europe and America in the first week of January increased by about 60 percent compared to the end of 2022 and 25 percent over the same period last year.
Currently, some shipping lines have announced that the freight rate from Vietnam to US West Coast ports is US$2,650 per 40-foot container while the prices to US East Coast ports and to Europe are $3,900 per 40-foot container and $4,900 per 40-foot container respectively.
