Any disruption to shipping via the Red Sea would affect the grain trade more than any other dry commodity, analysis shows.
Some 323.7m tonnes of dry cargo — equivalent to almost 6.5% of seaborne dry bulk trade — passed through the Suez Canal in 2022, according to analysis by commodities data platform Kpler.
Dry bulk trade flowing through the canal will this year exceed this level and totalled close to 318m tonnes at the end of November, according to data compiled by Alexis Ellender, Kpler’s lead dry freight analyst.
More than 11% of seaborne grains and oilseeds trade used the route in 2022, much of which was fronthaul shipments out of the Black Sea; corn, soybean and wheat exports from US East Coast (USEC) and US Gulf (USG) ports; plus European grain exports.
“This is a markedly higher proportion than for coal and iron ore trade,” Ellender said in his research report.
Congestion and delays at the Panama Canal have also pushed grain exports from the USEC and USG to use the Suez Canal.
In October, 55% of USEC and USG grain and oilseeds exports — almost 4.2m tonnes in total — used the Suez Canal route. A year ago, this level was just 14% of these exports or just over 1m tonnes, according to Kpler data.
More strong volumes are expected this month, when US soybean exports hit their seasonal peak.
At a speed of 13 knots, a voyage from the USG to central China takes four days longer via the Cape of Good Hope compared with transiting the Suez Canal, Ellender noted.
The Baltic Supramax Index (based on a 58,000-dwt vessel) S1C benchmark route from the USG to the Far East currently stands close to $39,000 per day. This means the extra four days at sea would add another $156,000 to voyage costs before the cost of bunkers and other expenses are added, Ellender said in the report.
The Red Sea region is also an exporter of fertilisers and other dry cargo that does not transit the canal.
Some 20.7m tonnes of dry bulk shipments, primarily fertilisers, was exported from the Red Sea last year without passing through the Suez Canal, Kpler data shows. Some 24.5m tonnes was imported, much of which was grains and oilseeds.
On Wednesday, a tanker reported the “sudden” appearance of two white plumes of smoke in the sky around 50nm west of Hodeida, Yemen, but the cause of the smoke is unclear, according to an update from global maritime risk management Ambrey.
No explosion sound was audible to the crew onboard the Vietnam-flagged tanker that spotted the plumes, which was 15 nautical miles north of the smoke.
Ambrey said it had assessed the plumes to have appeared after the interception of aerial threats by military assets in the area. No Israeli-affiliated vessel was in the southern Red Sea at the time of the incident.
