Container shipping companies face many obstacles, which will prevent them from reinvesting their capacity into the Suez Canal route, and the sharp drop in spot freight rates is one of them.

The events happening in Gaza and the West Bank seem to be enough to convince most shipping companies that the return to the Suez Canal route needs to be postponed until its safety is confirmed.

Previously, the Chief of the General Staff of the Houthi Armed Forces warned that if the conflict escalates again, hostile actions may resurface. We are closely monitoring the development of the situation. If the enemy resumes its aggression against Gaza, we will resume military operations and re prohibit Israel's navigation in the Red Sea and the Arabian Sea

Xeneta The company believes that there has been little disclosure of relevant details surrounding the seemingly concluded attack, which is not enough to convince most shipping companies or their insurance companies that the Red Sea route is safe for navigation.

Xeneta Chief analyst Peter Sander stated that container shipping companies cannot trust the military commitments of the Houthis. We have seen some shipping companies making exploratory attempts, such as the "Zhenghe" and "Benjamin Franklin" ships under Daffy Shipping in the region in November, but overall, the number of container ships passing through the Suez Canal in 2025 is showing a downward trend. He believes that it is not urgent for the cargo volume of the Suez Canal to recover to the level of 2023, and this viewpoint has also been supported Alphaliner Approval of the company's latest market report.

according to Alphaliner It is said that Dafei operates the Ocean Alliance Med5 This is the only route that will continue to pass through the Suez Canal throughout 2025, and its alliance partners EVA Shipping, COSCO Shipping, and Orient Overseas will operate in shared cabins on this route. The partners of this alliance are still with this French shipping company Medex There are cabin arrangements on the route, which travels between the Mediterranean and the Middle East/subcontinent via the Suez Canal, but this is not a route of the Ocean Alliance.

Near the entrance of the Mandeb Strait and the surrounding waters of Yemen, Dafei's ships are protected by French naval vessels.

Alphaliner Both routes will stop in Beirut to transport important supplies to the Levant region, and the French owner of the Daffy ship originally came from Lebanon, which may further prevent Houthi militants from targeting any ' BEX2' Or ' MEDEX' The ship launched an attack. "

According to statistical data, by 2025, Dafei Shipping will be the main container shipping company through the Suez Canal, with a shipping volume of nearly 1.5 million TEUs; Maersk is the second largest user of the canal, with approximately 1.1 million TEUs of goods passing through the waterway. However, Maersk's shipping routes only connect the Tangier Mediterranean Port with the ports of Said and Jeddah, approximately 500 kilometers from the Yemen border. Maersk's ships have never sailed to the farthest areas of the southern Red Sea.

Among the other top ten shipping companies, only Mediterranean Shipping and Hapag Lloyd have routes passing through the region, with transport volumes of approximately 900000 TEUs and 150000 TEUs, respectively.

Alphaliner It is also pointed out that "network adjustments will require significant adjustments to the service mode of feeder, shuttle, and mainline ships to and from Saudi Arabia, as well as Mediterranean transit ports for Asia Nordic routes

Factors such as these indicate that shipping companies must have a high level of safety certainty in order to return to this shorter, more cost-effective, and less polluting Red Sea and Suez Canal route.

In addition, Xeneta The company estimates that the longer route bypassing Cape of Good Hope has absorbed approximately 2 million TEUs of shipping capacity. Sander added that since the beginning of the year, spot freight rates from Asia to Europe, the Mediterranean, and the East Coast of the United States have plummeted by 50%. The return of a large number of container ships to the Red Sea will lead to overcapacity in the market, causing further drops in freight rates on various trade routes worldwide, not just those directly affected by route changes. He added that global spot freight rates are expected to fall by another 25% by 2026, and even without the influx of capacity from the Cape of Good Hope, shipping companies have already entered a loss making situation.

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