Denmark's Maersk Halts Red Sea Shipping; Container Costs Up 173%, Rerouted Through Africa

Denmark's shipping giant Maersk, the world's second-largest shipping company, has announced an indefinite suspension of all transits through the Red Sea following attacks by Iran-backed Houthi militants. The decision comes after a Houthi attack on the Maersk Hangzhou, which led to an intervention by the US Navy resulting in the sinking of Houthi boats. Maersk's pause in operations is a response to the escalating maritime conflict, and the company is rerouting its vessels through Africa around the Cape of Good Hope as an alternative. This move has significant implications for global shipping routes, with the Red Sea being a crucial maritime corridor. The suspension has prompted a surge in container shipping rates, with costs to ship a 40-foot container from Asia to northern Europe increasing by 173% to over $4,000. Other major shipping companies, including Cosco, MSC, CMA CGM, and Hapag-Lloyd, have taken similar actions, with Cosco halting all shipments to Israel due to security threats in the Red Sea. The situation remains highly volatile, and Maersk has advised customers to prepare for significant disruption. Houthi sanctions have been mentioned as a contributing factor, and Suez Canal traffic has seen a 28% decline.