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Soaring Spot Shipping Rates for Red Sea Routes

Container ship with 40-foot containers. CC/Patrick Denker.

Yemen’s military actions in the Red Sea have contributed to soaring spot prices for ocean shipping. The cost of shipping a standard 40-foot container from Asia to northern Europe has increased by 173%—to over $4,000—since the attacks began a month ago, Bloomberg reports, citing data released by cargo shipping platform on January 3.

Asia-Mediterranean costs have soared to $5,175, while some quotes for service later this month exceed $6,000. Meanwhile, rates for shipping from Asia to the East Coast of the U.S. have increased by 55% to nearly $4,000 per container. Ships are rerouting around the Cape of Good Hope, which increases the time of shipping, reducing the potential throughput of ships. The added cost of tied-up capital and increased fuel and personnel costs are driving prices upward.

Bloomberg says that the IMF’s Port Watch service reports that shipping through the Suez Canal for the 10 days ending Jan. 2 was down 28% from a year earlier.