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Despite Suez toll cuts, carriers continue to reroute via the Cape of Good Hope

The Suez Canal Authority might be forced to offer even greater rebates if it is not to lose more traffic with many boxships still opting to go via the Cape of Good Hope to soak up capacity and save costs.

The canal authority slashed rates on May 1 in reaction to a swathe of carriers – led by CMA CGM – avoiding the waterway.

Alphaliner reports the Cape route remains popular. As of May 26, a total of 15 ships that departed from Europe and North America in May are still using the Cape route, even though they would have been eligible for the Suez toll discounts. This has brought the total number of container ships using the Cape route to 32 since March this year, according to Alphaliner data.

On the Asia-Europe tradelane, the Cape route is more than 3,000 nautical miles longer than via the three-week Suez Canal route.

The Cape routing is not unprecedented. When oil prices dropped to very low levels in late 2015, in early 2016 many vessels from the US east coast to Asia did the same until the Suez Canal made a large discount.

Photo: MarineTraffic.com

Sam Chambers

Starting out with the Informa Group in 2000 in Hong Kong, Sam Chambers became editor of Maritime Asia magazine as well as East Asia Editor for the world’s oldest newspaper, Lloyd’s List. In 2005 he pursued a freelance career and wrote for a variety of titles including taking on the role of Asia Editor at Seatrade magazine and China correspondent for Supply Chain Asia. His work has also appeared in The Economist, The New York Times, The Sunday Times and The International Herald Tribune.
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