London/New York
CNN
—
of bridge collapse The indefinite halt to the flow of ships in and out of the Port of Baltimore could hurt the local economy, strain supply chains and disrupt shipping along the U.S. East Coast.
of key bridge collapses After a container ship called Dali collided with one of its supports. The Dali is operated by Singapore-based Synergy Group, but was chartered by Danish shipping giant Maersk to transport cargo.
The Port of Baltimore said: Post to X Ship traffic was suspended until further notice, but trucks were still being processed at the terminal.
Seven container ships were scheduled to arrive in Baltimore by Saturday, said Judah Levin, research director at logistics company Freitos.
“Baltimore will be excluded from all services for the time being until it is deemed safe to travel through the region,” Maersk said in a statement. The company said it would unload cargo destined for Baltimore at other nearby ports, but warned customers that doing so could result in delays.
Closer to the Midwest than other ports on the East Coast, Baltimore is a major hub for vehicles, containers, and household goods. Baltimore ranks No. 1 among U.S. car and light truck ports, handling a record 850,000 vehicles last year.
“Last year, we received, processed and shipped approximately 100,000 vehicles through Baltimore to our U.S. dealerships in the Northeast and Mid-Atlantic regions,” Volkswagen said in a statement. “While no impact to vessel operations is expected, there may be delays to trucking as traffic is rerouted in the area.”
Traffic and delivery congestion
Oren Krachkin, an economist at Nationwide Financial Markets, said in a note Tuesday that the bridge collapse could “disrupt logistics operations up and down the East Coast.”
Part of the reason may be due to transportation partnerships on Interstate 95, a major transportation artery along the East Coast.
Many of the 30,000 to 35,000 cars and trucks that use the Key Bridge each day could be rerouted through the tunnel, but doing so would cause traffic delays. Additionally, hazardous materials not allowed into the tunnel will be diverted to a longer detour.
Levine said rerouting cargo to the Ports of Philadelphia, Norfolk, or New York/New Jersey could increase trucking and rail prices at higher volumes and create some congestion at these alternative ports. He said it could happen.
“If congestion occurs and ships are forced to wait, it could cause delays for importers using these ports. Congestion could also put upward pressure on freight rates in Asia, the U.S. East Coast, and across the Atlantic. “There is a gender,” he added.
Transatlantic shipping costs are almost back to 2019 levels after surging during the pandemic. However, prices for travel from Asia to the U.S. East Coast remain below March 2019 levels as attacks on ships in the Red Sea forced ships to detour around Africa instead of using the Suez Canal. It has more than doubled.
Mark Zandi, chief economist at Moody’s Analytics, said other East Coast ports should have enough capacity to handle the ships that normally call at Baltimore. However, unexpected disruptions on other ports can cause problems.
“This leaves no room for error,” he said.
Despite the potential for some increase in shipping costs, Zandi said the disruption is unlikely to cause problems for shippers. the entire U.S. economy, as goods are more likely to find other ports.
“This particular event should not show up in national economic statistics,” he said. “It complicates things. But there’s already a lot of disruption in international supply chains.”
Part of the problem in determining the potential additional costs of shipping is that it is unclear how long ports will be closed.
Maryland Gov. Wes Moore said Monday it was too early to say when ships would start calling at ports again.
“Right now, we’re focused on saving lives, we’re focused on search and rescue,” he told a news conference.
The Patapsco River has a relatively narrow channel in its center that is deep enough to accommodate large vessels such as container ships, cruise ships, and car carriers. So removing debris from that passage could allow the port to reopen while crews continue to remove other debris that has fallen into the river.
President Joe Biden vowed Tuesday that the federal government would help reopen ports quickly, but he also did not say when.
“15,000 jobs depend on that port. And we’re going to do everything we can to protect those jobs and help those workers,” he said.
Tasos Katopodis/Getty Images
On March 26, 2024, the cargo ship Dali was photographed colliding with the Francis Scott Key Bridge and collapsing in Baltimore, Maryland. Rescuers are searching for at least seven people, and two others were pulled from the Patapsco River, authorities said.
As such, rebuilding the bridge could take years, but Moore described the process as a “long-term construction” and while there is currently no set timeline, debris removal could be a priority. is more likely to occur and can be completed much faster.
Overall, Baltimore ranks as the ninth largest U.S. port for international cargo. In 2023, the amount handled was a record high of 52.3 million tons, with a value of $80.8 billion. According to the Maryland government, the port supports 15,330 direct jobs and 139,180 jobs in related services.
Baltimore is also the nation’s leading port for importing agricultural and construction equipment, sugar and gypsum, and the nation’s second-largest port for exporting coal.
“Although Baltimore is not one of the largest ports on the US East Coast, it still imports and exports more than 1 million containers each year, so this can cause significant disruption to the supply chain,” Market Analyst Emily Stausboul said. Norway-based shipping analytics company Xeneta;
One of the major manufacturers located in the Port of Baltimore is Domino Sugar Refinery. The facility is his 115-year-old and, according to the company, is the largest sugar cane mill in the Western Hemisphere. One of the city’s oldest manufacturers, the Domino Sugar sign is a famous Baltimore landmark.
At sugar refineries, raw sugar imported by ship is refined to create a variety of products. Company officials did not respond to questions about the refinery’s raw sugar inventory or its operational plans during the port closure.
Baltimore also has a cruise terminal, with Royal Caribbean (R.C.L.), carnival (CCL) and Norwegian (NCLH). Last year, cruises carrying more than 444,000 passengers departed from the port.
Carnival Cruise Lines spokesman Matt Lupoli said, “Our thoughts are with those affected by this tragic accident,” and it would be time to comment on the potential impact on future operations. He added that it was too early.
The Cruise Lines International Association (CIAL) said it was “deeply saddened by this tragedy.”
“We are closely monitoring this situation. The most important thing to do now is to allow emergency personnel to do their jobs,” it said in a statement.
Royal Caribbean said its port logistics team is working on alternatives for Vision of the Seas’ ongoing and future sailings and will contact them if anything comes up. Once plans are finalized, keep your guests and travel partners updated.
The bridge collapse would create traffic congestion and headaches for the Baltimore area and cause a temporary loss of port business, but even if it didn’t happen, it would ultimately save money that would be spent on rebuilding the bridge. would provide a type of economic stimulus to the city. Want to get started now?
“It’s like a natural disaster. It’s very destructive in the short term, but then you rebuild and economic activity picks up,” Zandi said.
Hanna Ziady, Peter Valdes-Dapena, Rob North, and Sugum Pokharel contributed to this article.
