- The number of cargo ships moving through the route has reduced from 45 to 18 as of May 7.
- Tanker ships on the other hand have reduced from 21 to 17.
Image: FILE
Kenya is among net importers likely to witness shipping costs as Red Sea attacks on cargo ships by the Houthi rebel group escalate.
Latest data by PortWatch shows the ongoing attacks are increasingly disrupting cargo and tanker ships, reducing the weekly shipping average through the Suez Canal, Africa’s shortest link to the East and West, by about 58 per cent.
“The seven day moving average has reduced from 71 ships in December 6, last year to 30 ships as of May 7, this year,” says the report.
The number of cargo ships moving through the route has reduced from 45 to 18 during the same period. Tanker ships on the other hand have reduced from 21 to 17.
The figures point towards reduced shipment of essential commodities from exporting countries into Africa, driving up demand which consequently pushes up prices.
Consumers in the susceptible countries are currently grappling with heightened prices of commodities on the back of increased freight costs occasioned by the re-routing through the Cape of Good Hope.
Attacks on commercial ships prompted shipping companies to re-route traffic away from the Red Sea, a systemically important shipping lane that facilitates about 15 per cent of global maritime trade volume and over 22,000 transit calls annually.
As a result, container freight rates gradually increased since November last year.
Data by Statista shows the global freight rate for a 40-foot container hit over $3,900 (Sh508,000) in February 2024, the highest value on record, before decreasing slightly in March.
Just before the onset of the Red Sea attacks in October, the container rate was going at just about $1,342 (Sh175,000).
This has since occasioned big shifts in the shipping industry.
The negative effects of the vessel attacks could likely negate calmness in inflation witnessed in the past three months where the country recorded a decline in fuel and some food item prices, bringing down the level of inflation to 5.0 per cent in April.
General inflation was expected to ease in the whole of 2024 after more than 18 months of interest rate hikes by central banks; the most aggressive monetary tightening in decades, but attacks by Houthi rebels are threatening to push up the cost of living again.
The attacks from the Israel -Palestine dispute in the Gaza Strip are now approaching seven months.
Since the first attack in November last year, data shows the numbers have risen to about 68 as of March.
Experts have since warned that African citizens are the ones paying the price of delays, more expensive consumer goods, disruption to local economic entities and polluted waterways.
They have also expressed concern that further escalation of the disruptions will contribute to a highly unpredictable business environment in the long run.
Even so, the Houthis, supported by the Iranian government have vowed to continue with the attacks until Israel ends aggression in the contested Gaza Strip.