Suez offers 30pc off to induce backhauling box ships to shun the Cape
OWING to the popularity of the Cape of Good Hope for backhaul legs of Asia-US east coast traffic, the Suez Canal Authority (SCA) is lowering its transit fees, report's London's Loadstar.
The reduction in transit fees follows reports that over 100 cargo vessels have chosen the longer route via the southern tip of Africa late last year, resulting in Egyptian revenue losses.
Cape route diversions also hit authorities and private investors who invested US$8 billion in a 35 kilometre second channel that was expected to increase canal traffic.
Two years of declining oil prices have encouraged ship operators to re-evaluate the cost of the additional sea passage against the cost of canal transit.
A 13,000-TEU ship, for example, adds 3,500 nautical miles and just over a week using the Cape route. That's a typical a bunker burn of $180,000 against ypical canal fees of $350,000.
The Suez Canal Authority is now offering a 30 per cent rebate on canal fees for ships from the North American Atlantic seaboard destined for Port Kelang, or other ports east of the Malay hub.
According to Alphaliner data, there are currently six Asia-US east coast alliance services now backhauling ships via the Cape rather than via the canal, as well as two US east coast/Caribbean services previously returning via the Panama Canal.
OWING to the popularity of the Cape of Good Hope for backhaul legs of Asia-US east coast traffic, the Suez Canal Authority (SCA) is lowering its transit fees, report's London's Loadstar.
The reduction in transit fees follows reports that over 100 cargo vessels have chosen the longer route via the southern tip of Africa late last year, resulting in Egyptian revenue losses.
Cape route diversions also hit authorities and private investors who invested US$8 billion in a 35 kilometre second channel that was expected to increase canal traffic.
Two years of declining oil prices have encouraged ship operators to re-evaluate the cost of the additional sea passage against the cost of canal transit.
A 13,000-TEU ship, for example, adds 3,500 nautical miles and just over a week using the Cape route. That's a typical a bunker burn of $180,000 against ypical canal fees of $350,000.
The Suez Canal Authority is now offering a 30 per cent rebate on canal fees for ships from the North American Atlantic seaboard destined for Port Kelang, or other ports east of the Malay hub.
According to Alphaliner data, there are currently six Asia-US east coast alliance services now backhauling ships via the Cape rather than via the canal, as well as two US east coast/Caribbean services previously returning via the Panama Canal.