In 1956, an American trucker named Malcolm McLean had an idea that was almost suspiciously simple: What if you could take the big metal box off the back of a truck, put the whole thing on a ship, and skip the tedious business of unloading and reloading everything inside? The shipping container was born, global trade got a serious upgrade, and eventually the world built an economy around moving those boxes from Point A to Point B with remarkable efficiency.
There was just one small catch.
A surprising number of those trips still depend on Point A and Point B being connected by some very narrow stretches of water.
And lately, the water is not cooperating.
A global game of shipping Tetris
The extended disruption of commercial traffic through the Strait of Hormuz has already demonstrated just how much economic activity can depend on a relatively tiny piece of geography. The closure has contributed to fuel shortages and slower global economic growth, while exposing the broader vulnerability created by the world’s dependence on a handful of maritime chokepoints.
In the Red Sea, the threat from Houthi attacks continues to hang over vessels using the Bab el-Mandeb Strait. The U.S. Maritime Administration warns that vessels with certain U.S., U.K., or Israeli associations remain at heightened risk in the southern Red Sea, Bab el-Mandeb Strait, and Gulf of Aden. Commercial ships continue to use the corridor, but every trip requires a more complicated calculation involving security, insurance, cargo, and whether taking the long way around Africa makes more sense.
The Black Sea isn’t offering much relief. Ukraine and Russia continue to target maritime and port infrastructure, and an attack on Novorossiysk this week damaged port facilities and disrupted grain terminal operations. The stakes extend beyond whatever happens to be sitting on a dock that day. Black Sea ports remain important links in global grain and energy markets.
When the rivers run low
Exceptionally low water levels on the Rhine are restricting inland shipping across northwestern Europe. Barges have been forced to reduce cargo loads, while some freight is being shifted onto road and rail networks. The Danube is dealing with similar problems, with official navigation notices citing low-water conditions along portions of the river.
Then there’s Panama.
Low water levels associated with a strengthening El Niño are colliding with increased demand for passage through the Panama Canal as ships adjust to disruptions elsewhere. The result is a very expensive traffic jam. Auctions for canal transit slots have reached record highs, while draft restrictions mean some ships must carry lighter loads.
There is no easy detour
The bigger issue isn’t any single chokepoint. It’s what happens when problems start stacking on top of one another.
Rerouting a ship looks simple enough on a map. Unfortunately, ships burn fuel, crews need to be paid, cargo has deadlines, ports have finite capacity, and insurance companies have opinions about sending extremely expensive vessels through places where people are firing missiles.
Recent data shows maritime transport carries more than 80% of world merchandise trade by volume and warns that longer sailing distances, rerouting, port congestion, and geopolitical disruption are making high and volatile freight rates increasingly common. In other words, the global shipping system can adapt. Unfortunately, adaptation isn’t free.
Perhaps the best summary comes from Chatham House’s Nitya Labh: “The closure of Hormuz has shown how the global economy is dependent on a few, narrow shipping channels.”
Why you should care: You probably aren’t responsible for navigating a container ship through the Strait of Malacca (If you are, please reply to this email. We’d love to hear from you).
But maritime disruption doesn’t stay maritime for long.
A delayed vessel can become a delayed component, a production slowdown, an inventory shortage, a fuel-price increase, or a missed customer commitment thousands of miles from the original disruption. And when several shipping routes face problems at the same time, organizations have fewer easy alternatives.
For business continuity and security teams, that means supply-chain visibility should increasingly include the waterways connecting your suppliers, facilities, and markets. Knowing where something comes from is only half the equation. Knowing how it gets to you, which chokepoints it depends on, and what happens if that route suddenly becomes unavailable can reveal risks buried several layers deep in your operations. |
