A huge container ship called the Ever Given, made headlines last March as it blocked one of the world’s busiest shipping channels, the Suez Canal, for a whopping six days. Not only did this cause a huge delay in delivering its own billion-dollar cargo, but most costly of all it held up the thousands of cargo ships behind it. Here’s the staggering cost of this crisis.
The Ever Given is a ginormous ship. It is a whopping 400m-long and weighs 200,000 tonnes with a maximum capacity of 20,000 containers.
When it got stuck in the middle of the Suez Canal it stopped huge amounts of global trade for almost a week.
Estimates of the total cost of the Ever Given accident vary wildly. But experts all agree that the final bill is vast.
According to the New York Times when the ship blocked the canal it held up as much as $10 billion (approximately £7,354,200,000) of cargo a day.
While maritime data company, Lloyd’s List, estimated that the ship held up $9.6 billion (approximately £7,060,032,000) in trade daily.
A range of goods such as cars, oil, livestock, laptops, sneakers, electronics and all-important toilet paper, were prevented from passing through the world’s fourth busiest shipping channel.
The Suez Canal usually processes about 50 ships a day, which accounts for about 12 percent of the world’s trade according to reports by Associated Press.
This means hundreds of ships carrying expensive cargo were blocked from travelling until the Ever Given was freed on March 29, 2021.
Ships could be rerouted around southern Africa but this would add days to their journey and the costs of this were prohibitive.
According to Refinitiv, the financial market data company, rerouting around southern Africa would cost cargo ships around $30,000 a day in extra fuel expenses not to mention the fees incurred by late delivery of goods.
Once the authority which runs the canal, the Suez Canal Authority (SCA), freed the Ever Given it refused to release the container ship and its cargo and crew without being paid salvage fees and damages worth nearly $1 billion (approximately £735,420,000).
Although according to Quartz, the SCA later reduced the price of its claim to around $550 million (approximately £404,470,000), however, the details of the final compensation agreement haven’t been made public yet.
Strong winds exceeding 46mph meant that the ship’s crew reported a “loss of the ability to steer the ship”, and it ran aground and turned sideways, making it unable to free itself.
This blocked the canal on both sides meaning no cargo vessels could get around it.
The ship was carrying nearly $1 billion (approximately £735,420,000) worth of goods such as Nike shoes, Lenovo laptops, IKEA furniture, sex toys and bikes.
According to Lloyd’s List over 300 vessels at both ends of the canal were obstructed by the Ever Given.