Supply Chain Woe Could Be Caused by Baltimore Bridge Incident

The collapse of the Francis Scott Key Bridge in Baltimore occurred following an incident in which it was hit by the 10,000 TEU container ship Dali, which was operating under the 2M alliance's service route from the Far East to the US East Coast.

Despite Baltimore not being ranked among the top ports on the US East Coast, it handles over one million containers annually, posing a significant risk of disrupting supply chains, observed Emily Stausbøll, a Market Analyst at Xeneta, a platform specializing in benchmarking and providing intelligence on ocean freight shipping rates.

Stausbøll commented, "The immediate focus is the rescue operation, but there will clearly be a highly-complex recovery phase and investigation to follow and we don't know what impact this will have on operations at the Port of Baltimore."

She also highlighted that the ocean freight network between the Far East and the US East Coast has already been under strain due to the Panama Canal drought and the Red Sea crisis, which have led to a 150% increase in shipping rates.

Stausbøll suggested that other larger US East Coast ports like New York/New Jersey and Virginia might accommodate the extra container imports if Baltimore remains closed, potentially mitigating the impact on ocean freight shipping rates.

However, she cautioned that the available port capacity is finite, leaving supply chains at risk of further disruptions.

"The question is how quickly ocean freight carriers can put diversions in place, particularly for vessels already en route to Baltimore or containers at the port waiting to be exported," Stausbøll pondered.