Hapag-Lloyd halts Suez Canal plans for its India-US East Coast service due to insurance concerns, impacting key freight forwarders and shippers.
German shipping giant Hapag-Lloyd has abandoned plans to reinstate a Suez Canal routing for its India-US East Coast TPI service after failing to secure customer support due to insurance concerns, reports London's S&P Global.
Expeditors International, the carrier's largest freight forwarder for India-US volumes, raised concerns over terrorism and war-risk liabilities associated with Red Sea transits. A Hapag-Lloyd India executive noted that many shippers were unwilling to sign letters of intent that required them to absorb these risks.
The company stated that no timeline has been set for a potential Suez return, emphasizing that stability and tangible progress are necessary before vessels can resume transits. Expeditors moves approximately 400 TEU per week on the TPI, making its support critical.
Other forwarders, including DSV, Kuehne + Nagel, and CH Robinson, have indicated a willingness to support a Suez return; however, insurance exposure remains a significant sticking point. US retailer Costco is among the buyers hesitant to commit cargo for this route.
Hapag-Lloyd handled 303,500 TEU from India to the US through November, representing about 23 percent of the 1.3 million TEU market.
Carriers continue to divert around southern Africa amid an unsettled ceasefire between Israel and Hamas. The Premier Alliance's 2026 network avoids the Red Sea, while Ocean Network Express plans a tentative return under a slot charter deal.
CMA CGM plans to resume a Suez rotation for its Indamex service in January, with the CMA CGM Verdi scheduled to depart Nhava Sheva on January 18 and transit the canal on February 8. The French line aims for a full Suez rotation by the second quarter of 2026.
