Container lines reroute from Iran war to India and Sri Lanka

• Iran steps up vessel attacks
• Carriers avoiding bottleneck
• 10% of global fleet affected

Container shipping lines are rerouting cargo away from Gulf ports as far away as India and Sri Lanka as Iran steps up attacks on commercial vessels beyond the Strait of Hormuz.

The disruption is creating a logistics headache as carriers search for alternative gateways into Gulf countries.

More than 10 per cent of the global liner shipping fleet is now “directly affected” by the war, according to maritime analyst Alphaliner.

Indian ports are playing an increasing role in diversion strategies, with hubs such as Mundra in Gujarat and Nhava Sheva on India’s west coast being used to handle cargo, said Mael Pape-Léostic, a shipping analyst at Alphaliner.

Salalah in Oman had been emerging as a major transhipment point until it was closed after being struck by several drones on March 11.

“Salalah and Khor Fakkan had become the primary direct alternatives for accessing the region, particularly for the rapid discharge of time-sensitive cargo such as perishables,” Pape-Léostic said.

“We are now keeping a close eye on Salalah as there will be pressure on it to reopen soon. Indian hubs are also being utilised, notably Mundra, Nhava Sheva and Colombo in Sri Lanka.”

Ships broadcast their intended destination through AIS (Automatic Identification System) transponders, effectively “declaring” the port they expect to call at.

Between January 28 and March 10 the number of vessels declaring Jebel Ali in Dubai as their destination fell from 67 to 23, while ships declaring Nhava Sheva near Mumbai rose from 21 to 36, according to Alphaliner.

While still modest, the number of vessels declaring Colombo rose from seven over the same period to a peak of 14 on March 4.

Meanwhile, vessels “moving toward” Khor Fakkan as a destination on the UAE’s east coast in the Gulf of Oman rose from two to 27.

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In his first public pronouncement on March 12, Iran’s new supreme leader Mojtaba Khamenei vowed to keep blocking the contested waterway.

Several vessels have been struck or damaged in attacks in and around the strait since the conflict escalated, with images of burning ships broadcast around the world.

There are now fears that with attacks on Omani infrastructure, the theatre of conflict is widening.

Pape-Léostic said the “ongoing conflict in the Middle East has a direct impact on 10.7 per cent of the global container shipping fleet based on TEU capacity”.

A TEU, or twenty-foot equivalent unit, is the standard measure used in maritime logistics to quantify container ship capacity, based on the volume of a 20-foot shipping container.

Carriers, he said, are adjusting their service networks to avoid the bottleneck while maintaining cargo flows to regional markets.

The Gemini Cooperation, the alliance between shipping giants Maersk and Hapag-Lloyd, has suspended several Gulf-linked services, including calls at Salalah, and introduced alternative routings to Gulf countries to keep cargo moving, Pape-Léostic said.

Since the war’s outset, the network has established a service linking the Far East to the Red Sea port of Jeddah, rerouting vessels via the Cape of Good Hope, the Mediterranean and the Suez Canal.

This effectively allows ships to bypass the Gulf of Aden for now.

“We are also expecting other carriers to consider this circuitous route,” Pape-Léostic said.

“In the longer run, as initiated by Gemini, we may see more cargo heading toward Gulf countries via Saudi Arabia’s Red Sea hubs, specifically Jeddah and King Abdullah Port, with transit via the Mediterranean,” Pape-Léostic said.

“Under this itinerary, cargo is then transported by truck or rail to its final destination.”