Suez Canal transits hold up but decline is predicted

By David Osler - Thursday 27 November 2008

Egypt depends on the canal as its third-largest owner of foreign exchange after tourism and remittances from overseas workers.VESSEL numbers through the Suez Canal seem to be holding up well, despite highly publicised decisions by some shipowners to re-route round the Cape of Good Hope, one of Egypt’s leading shipping agents has confirmed. Dan Delaney, manager at the Alexandria office of local Lloyd’s agency network affiliate Marine Technical Services, said that numbers of ships in convoys continued to fluctuate around normal levels. However, he did predict an eventual decrease, probably within the next few weeks. One way or the other, the outcome is of vital economic importance to Egypt, which depends on the canal as its third-largest owner of foreign exchange after tourism and remittances from overseas workers. AP Moller-Maersk, Svitzer, Odfjell and Pacific Carriers are among the companies that have taken the decision to re-route in some circumstances, and a number of shipping industry household names have said that they are considering their position. “You can get one day 18-20 vessels, the next day 45-50. There’s no appreciable difference, and we are going to have to wait at least a few more weeks before we notice a trend,” Mr Delaney commented. “I know some owners are going around the Cape now, and I don’t blame them. I think we will see a drop, but at the moment there is no drop we are noticing sufficient to say yes, this is now a trend.” The picture should be clearer towards the middle or even the end of next month, Mr Delaney suggested. Officials of the Suez Canal Authority have told the media that they are fearful of the impact of continued Somali piracy on canal business. Adel Lami, chairman of Port Said Navigation Chamber, a shipping trade organisation, told Associated Press: “One or two more piracy attacks will just send an alarm, and we will find ourselves with a big problem.”