In a bid to cover the increase in operational cost due to the Red Sea crisis and the need to re-route ships around the Cape of Good Hope, shipping firm A.P. Moller Maersk is implementing temporary surcharge, even as it is working towards improving resilience and minimising disruptions through various initiatives.
“The Red Sea situation has led to major challenges across the industry with reduced capacity, longer shipping times, and higher operational costs. Delays and longer transit times are affecting supply chains, inventory management, and production schedules globally,” the company said.
Maersk said that it has implemented temporary surcharges to help cover these increased operational costs. “We are continuously monitoring and adjusting surcharges as needed to ensure they are fair and reflective of additional costs,” it said.
Red Sea crisis and current situation
To safeguard our crew, vessels, and our customers’ cargo, the company is sailing around the Cape of Good Hope, adding approximately 4,000 miles to the total voyage length, resulting in longer voyage times and higher operational expenses. Currently, we are experiencing an average 40 per cent increase in fuel costs compared to when we sail through the Red Sea / Gulf of Aden.
“With roughly 30 per cent of global container traffic typically passing through the Suez Canal, changing to longer routes has severely disrupted global trade. The situation is also causing delays and congestion in key ports, including Singapore, Ningbo and Shanghai. Operational bottlenecks, vessel bunching, as well as equipment and capacity shortages are all leading to delays. We anticipate that the disruptions will continue into the second half of 2024,” it said.
Maersk’s response to mitigate the situation
Maersk is working to improve resilience and minimise disruptions to our customers through key investments as well as through ongoing operational adjustments. To increase shipping reliability, Maersk has added 125,000 additional containers to our fleet and are exploring further capacity enhancements.
“We have also increased sailing speeds, where possible, to reduce the impact of disruptions. Although this increases fuel costs, it helps to reduce the impact of delays on customers’ supply chains,” it said.
In addition to the multiple investments in ocean services, the company is providing alternative options to help customers minimise cargo delays and maintain flexibility.
Maersk is also offering a suite of solutions catering to diverse logistics needs. For urgent cargo across industries, Maersk Air is providing fast and reliable door-to-door services with a global network spanning over 90 countries.
For cost-conscious speed, Maersk Sea-Air combines ocean and air freight, offering two options: via Jebel Ali (UAE) for connections to Europe, or via Tanjung Pelepas (Malaysia) for access to major airports worldwide through Singapore or Kuala Lumpur.
Additionally, Maersk Cross-Border is offering a new, reliable, and eco-friendly weekly route for cargo from Xi’an and Yiwu, China, to Turkey, Georgia, and Azerbaijan, with further connections into Europe via block trains and Maersk Ocean services.
