- The US Federal Maritime Commission (FMC) conducted an informal public hearing to assess the repercussions of assaults on merchant vessels in the Red Sea and Gulf of Aden.
- Commissioner Carl Bentzel expressed apprehensions about the security of access through the Suez and Panama Canal, highlighting potential severe international economic consequences.
Concerns Over Supply Chain Disruption
Commissioner Bentzel underscored the lingering impact of the pandemic-induced supply chain disruption, leading to a 30% surge in imported container shipping. He attributed inflationary impacts to shipping delays, emphasizing that ocean shipping plays a vital role in the US economy, moving over 90% of international trade.
Potential Closure of Maritime Gateways
With reference to the Panama Canal’s drought-induced trade disruptions, Bentzel warned of nearly 50% reduction in total transit availability and 5-15% vessel carrying capacity constraints due to low water. The potential closure of major maritime gateways poses significant risks to global trade.
Anticipating Economic Impact
Bentzel highlighted the economic consequences, citing factory closures in Europe as a result of shipping-related supply chain disruptions. Despite current steady cargo movement, he emphasized that shipping conditions would change in the coming months, leading to potential challenges.
FMC’s Regulatory Role
While prioritizing the security of dockworkers and ships, Bentzel affirmed the FMC’s duty to protect the public from unreasonable shipping practices. He discussed evaluating the application of existing regulations and initiating investigations if necessary, considering the potential market abuse during the ongoing crisis.
Participants’ Perspectives
During the hearing, the FMC heard from 10 participants representing shippers, ocean carriers, and ports. The perspectives shared varied, offering insights into the diverse challenges and concerns faced by stakeholders in the current maritime crisis.
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Source: Port Technology
