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It's not like the $9b of daily commerce that can't get through the canal is being set alight and tipped overboard, it will reach its destination in the end. Som
by joosters 6y ago
It's not like the $9b of daily commerce that can't get through the canal is being set alight and tipped overboard, it will reach its destination in the end. Some of that produce might have gone off, or the delay in its arrival causes knock-on costs, but the final cost is only going to be a fraction of that figure, not a large multiple!
- craftinator 6y agoI agree that it won't be a large multiple, but, I do think it's naive to assume that it'll be a fraction of the cost. Consider the shear volume of stuff being transported. Millions of tons of goods across hundreds of delayed transports, some perishable, some with tight timeline requirements, some with tight contract requirements. And it's not like as soon as ships start moving again all of that cost will go away. Ships are still going to be diverted for weeks of not months to relieve traffic pressure.
- Clewza313 6y agoIf it's really time-critical, it's shipped by air, not sea. Container ships being delayed by a few days by rough weather, port delays etc happens all the time, and we're looking at a week tops here even for directly impacted ships.
- craftinator 6y agoI never said a large multiple. Regardless, below are some numbers that could get us started in estimating costs: According to this paper by the National Bureau of Economic Research, the average loss of value per day of delay from the cargo on these ships is between 0.6 and 2.2 percent [1]. According to other research I've seen, somewhere between 12% and 30% of daily global sea trade goes through the Suez Canal. Anyone want to do the math? 1) https://www.nber.org/digest/jun12/time-trade-barrier https://www.nber.org/digest/jun12/time-trade-barrier