The second issue is the low water level in the Panama Canal, causing draft restrictions of the vessels which in turn reduces the capacity offered on the Asia-USEC trade through Panama. The alternative is a routing through Suez which is longer in terms of transit time. The water level is projected to be much lower than seasonally expected into August and has reached a low last seen in 2019, 2016 and 1998. It seems driven by the El Niño weather phenomenon which could lead to the situation becoming worse rather than better. The third issue is slow steaming. The injection of a large number of new vessels combined with stronger environmental regulations is a clear incentive for carriers to slow down vessels. Implementation is already seen by the 2M alliance on Asia-Europe and is expected to spread to other carriers and trade lanes. If implemented across the major deep-sea trade lanes in 2023-2024, it could absorb as much as 7% of the global fleet. Overall, consignors should expect continued, short-term operational uncertainty in the supply chain, rising surcharges for usage of the Panama Canal and should plan longer transit times in the medium term. DSV – Global Transport & Logistics At DSV, we keep supply chains flowing in a world of change. We provide and manage supply chain solutions for thousands of companies every day – from the small family-run business to the large global corporation. Our reach is global, yet our presence is local and close to our customers. More than 75,000 employees in over 80 countries work passionately to deliver great customer experiences and high-quality services. We aspire to lead the way towards a more s ustainable future for our industry and are committed to trading on nature’s terms. DSV is a dynamic organisation that fosters inclusivity and diversity. We conduct our business with integrity, respecting different cultures and the dignity and rights of individuals.
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