East Mediterranean centres face challenges as the Red Sea crisis continues

  • April 12, 2024
  • News

The diversion of mainline vessels through the Cape of Good Hope has led to a significant decrease in vessel call capacity at East and Central Mediterranean hub ports, while West Mediterranean ports have displayed greater resilience.

As the security situation in the Red Sea remains unresolved, carriers continue to reroute mainline vessels trading between Asia and Europe via the Cape of Good Hope. Although there was an initial period of disruption when scheduled arrival dates were missed due to the longer diversion route, port calls in West Mediterranean ports have largely stabilized.

Container throughput at Algeciras in January 2024 experienced a modest 1.4% year-on-year decline, while volumes saw an 11% year-on-year increase at both Valencia and Barcelona. In contrast, East and Central Mediterranean hub ports have witnessed substantial reductions in average weekly vessel capacity during the first quarter of 2024, ranging from an 18% decline at Gioia Tauro to a 31% drop at Piraeus (refer to left map).

In January 2024, volumes handled at Piraeus Container Terminal saw a 13% year-on-year decrease, while traffic at Suez Canal Container Terminal fell by 3%.

Moreover, the average weekly capacity of container vessel calls at the main Red Sea ports has significantly decreased. While some carriers continue to serve Jeddah and King Abdullah, they have replaced mainline vessel calls with smaller shuttle services from Mediterranean hubs that offer a dedicated link to the northern Red Sea.

Dammam has observed some additional calls in the first quarter of 2024, although the high percentage growth rate is partly attributable to the relatively low base in the fourth quarter of 2023.

Furthermore, the Sri Lankan port of Colombo is emerging as a pivotal transhipment hub, providing carriers with the opportunity to transship cargo between services diverting via the Cape and services to/from the Middle East. Colombo recorded an 18% increase in average weekly vessel capacity in the first quarter of 2024, while year-to-date throughput had risen by 30% as of the end of February.