LONDON: Companies transporting their products around the world are not ready to return to the Red Sea trade route in the wake of a Gaza ceasefire deal because of uncer- tainty over whether Houthis will continue to attack shipping, industry executives said.
The EU’s naval force in the Red Sea said its “threat assessment remains unchanged.”
The leader of Houthis said on Thursday that the group would monitor the implementation of a ceasefire deal between Israel and Hamas aimed at ending the war in Gaza and continue its attacks on vessels or Israel if it is breached.
Executives from shipping, insurance, and retail industries said the risks remained too high to resume voyages through the Bab Al-Mandab Strait in the Red Sea, through which exports to Western markets from the Gulf and Asia must pass before entering the Suez Canal.
“There is no way I’m putting any of my merchandise on a boat that’s going to go through the Red Sea for some time to come,” said Jay Foreman, CEO of US-based Basic Fun, which supplies toys to major US retailers like Walmart and Amazon.com. Matt Castle, vice president of global forwarding with logistics group C.H. Robinson, said: “It’s not likely the industry will see a large shift back to the Suez Canal in the short term.”
He said this was due to the challenges of securing cargo insur- ance given perceived high risks and time constraints, as imple- menting a new ocean shipping plan would take weeks or months.