The Suez Canal Authority (SCA) has extended its initiative to hand out rebates to containerships coming from ports of the East Coast of America heading to South and South East Asian ports.

The authority will continue to grant all containerships coming from ports north of the Port of Norfolk on the US East Coast and heading to Port Klang and ports eastwards a 45% rebate on canal tolls.

For ports south of Norfolk vessels departing and calling Port Klang and eastwards will continue to be granted a 65% rebate in tolls, while those calling Colombo and eastwards will be given a 55% rebate.

The scheme, which was introduced in March 2016 with a poor take up rate, but was extended last summer with a greater discount, and will now run until 30 June 2017.

The initiative was originally introduced to stem of loss of business from lines deciding to sail via the Cape of Good Hope on the backhaul to Asia.

The SCA had seen revenues fall as a result of container lines transiting via the Cape of Good Hope despite a distance of 12,412 nm from New York, compared to 10,117 nm via the Suez Canal due to lower operating costs as a result of low bunker prices.

The initiative appears to be paying dividends; the SCA has forecast a $525m jump in revenue for 2016, stating it had has received “good feedback” about the discount deals. In that time though bunker prices almost doubled.

Speaking in November last year, SCA executive Tamer Hammad was reported as saying revenue would reach $5.7bn in 2016, a 10% increase on the $5.17bn achieved in 2015.

Source: seatrade-maritime.com