The fiscal year ended on June 30 in Egypt, and it turned out that the results of the work of the Suez Canal Administration (SCA), in charge of collecting funds for the passage of ships through it, are more than impressive. On July 11, SCA head Osama Rabia said that in the first half of 2021, the canal passed 9,763 vessels with 610 million tons of cargo against 588 million tons a year earlier, and in the 2020/21 fiscal year, the company recorded the highest income in the history of the channel – $ 5.84 billion. , this is 2% more than a year earlier.
Meanwhile, the Suez Canal was nearly celebrated by the whole world when the container ship Ever Given shut it down for a week at the end of March. Russia buried it especially conscientiously, promoting alternative transportation routes against the background of the crisis – the Trans-Eurasian railway (which really felt a noticeable influx of containers) and the Northern Sea Route (which did not feel it).
The blocking of the canal cost the world sea trade $ 400 million per hour, and the recipients of the cargo, worth about $ 770 million, had to wait three months until the freed ship was released from the “impound yard”, where the Egyptian authorities put it for refusing to pay compensation. Initially, SCA estimated its losses from the accident at $ 916 million, then agreed to reduce the requirements to $ 550 million, which the ship owner accepted, but this amount includes a salvage bonus (the ship was floated by the efforts of SCA) and compensation for moral damage. In its pure form, Egypt estimated the channel’s lost revenue per day of the crisis at $ 15 million.
However, against the backdrop of a boom in container traffic on the Asia-Europe route, an incident that could have destroyed the canal’s profits at another time had an unusually weak effect on its financial results.
The revival of container trade after the pandemic, the shortage of containers themselves and the capacity of ships have inflated freight rates to unprecedented heights. At the end of May, on the Asia-Europe route, for the first time in history, they jumped out for $ 10,000 per FEU (a conventional forty-foot container) and continued to grow. The difference, for example, between prices on the Shanghai-Rotterdam route at the beginning and end of the Egyptian fiscal year, according to the Drewry World Container Index, was 596%: the rate reached $ 12.2 thousand per FEU.
According to recent estimates by Moody’s, this prosperity will last all this year and will continue into the next. Strong demand will stimulate shipping on the Suez Canal. And in two years, according to SCA estimates, its expansion may be completed, which will increase its throughput. Therefore, if the $ 120 million spread in earnings now available to the last fiscal year can afford to run Ever Given once more, Egypt may be able to do it twice or thrice in the future.