For most of this year, the Suez story was about ships that would not go back. In September that started to change. On September 14, Maersk and Hapag Lloyd moved four more Gemini services back through the canal, joining the two loops already running. MSC, CMA CGM and COSCO have brought back selected services too. On September 16, the 24,188 TEU OOCL Portugal made COSCO’s first southbound Suez transit since the crisis began.
The strange part is the timing. The return is gathering pace while security in the southern Red Sea is getting worse, not better. The Houthis declared a naval blockade on Saudi Arabia in July. A ship in the Bab el Mandeb was hit in August, and four crew members were killed. In September the group took the port city of Mokha, then reached the town of Dhubab and Perim Island, which sits in the middle of the Bab el Mandeb and splits it into two shipping channels. The Houthis now hold Yemen’s entire Red Sea coast and say the route stays open to everyone except Saudi linked ships. Demand for naval escorts through the strait is now outrunning what the EU’s Aspides mission can supply. Carriers are going back in anyway, and that is the story worth understanding.
How far the return has actually gone
Further than it was, but not nearly as far as the headlines suggest. Drewry counted 48 container ship transits in the week to September 24, up from 41 the week before, against roughly 80 a week before the attacks started. Linerlytica counts more than 140 container ships with over 2 million TEU of combined capacity returning to Suez since May, and the last full week of September was the busiest for large container ship transits through the canal since 2024. Sea Intelligence estimates about 27 percent of normal Asia Europe capacity is routing through the Red Sea this month. The Suez Canal Authority puts container ship net tonnage for January to August at 72.1 million tons, up 54 percent on the same period last year. Several major lines, including Evergreen, ONE, HMM and Yang Ming, have not come back at all.
Why the first ships back are mostly heading east
The split by direction tells you what carriers are really doing. Sea Intelligence puts September backhaul, Europe to Asia, at 25 to 47 percent routed through Suez, against 13 to 25 percent on the headhaul. On the Mediterranean trade, 57 percent of capacity is using the Red Sea. From North Europe it is closer to 27 percent. Carriers are not betting their whole network on the Red Sea. They have been using the shorter route to get ships back to Asia faster, where a heavy typhoon season has left ports congested and vessels bunched. Loaded boxes heading west, the cargo that matters most, have mostly kept going around Africa. That is now starting to shift. After nine eastbound voyages through the canal since mid September, COSCO scheduled its first westbound Suez transit in more than two years for October 4, on the 24,200 TEU OOCL Spain, and the Premier Alliance is preparing to bring Asia to North Europe services back through the canal. Maersk, for its part, has said its September moves are not a broad return of its East West network.
Why go back now
Three pressures are pushing at once. Fuel costs are up sharply this year, so two extra weeks at sea cost more than they used to. Congested Asian hubs need ships back quickly, and Suez is the fastest way to reposition them. And once one alliance shows a service can run through the canal, every rival still sailing the long way carries a cost disadvantage on every voyage. What carriers are keeping is the ability to reverse. Every announcement comes with the same condition: routing depends on stability and on there being no further escalation.
What the return does to rates
A return to Suez does not bring back 2023 rates just because the route is shorter. It works through capacity. Xeneta estimates that a large scale return could release the equivalent of 6 to 8 percent of the global container fleet. BIMCO puts the drop in container ship demand at up to 10 percent. That capacity does not leave the market. It lands on it. Drewry’s World Container Index slipped to 4,468 dollars per 40 foot container on September 24, led by Asia Europe. With Golden Week softening demand in early October, carriers are already blanking sailings to hold rates up. Rates are heading down, and how fast depends on whether the Red Sea stays open.
Why this matters even if you never route through Suez
Gulf freight buyers feel this whether or not any of their boxes ever cross the canal. Container capacity is one global pool, so a ship released from the Cape loop this month is available on an Asia Gulf string the next. Gulf cargo now also sits between two chokepoints at once: Hormuz, still badly disrupted, and a Bab el Mandeb where the Houthis now hold the Yemeni shore and the island in the middle of the strait. Saudi Arabia has leaned on its Red Sea ports precisely because Hormuz is impeded, and it is now the target of the Houthi blockade. Rate models built for one disruption at a time do not fit that picture.
What I am watching from here
First, whether the Houthis turn their new positions around the Bab el Mandeb into renewed attacks on merchant ships in the main shipping lane, which would reverse this return within days. Second, whether westbound headhaul routing keeps following the eastbound backhaul now that COSCO has made its first westbound transit, which is the real signal that carriers trust the route. Third, whether naval escort capacity catches up with demand, and whether Evergreen, ONE, HMM and Yang Ming stay out. Fourth, what happens to Asia Europe rates once post Golden Week demand meets the capacity Suez is releasing. For contracts, index linked clauses beat fixed surcharges right now. Any fixed number written this month will be wrong in one direction or the other by the new year.
That is issue five. If this was useful, forward it to someone who still thinks of the Red Sea as simply open or closed.
Dhiraj
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