Baltimore bridge collapse could cause significant supply chain disruption

The layers of supply chain stressors have caused rates to increase by 150%, according to Xeneta, and the incident in Baltimore "will add to those concerns".

"It is likely other larger US East Coast ports such as neighbouring New York, New Jersey and Virginia can handle additional container imports if Baltimore is inaccessible, which may limit any impact on ocean freight shipping rates. However, there is only so much port capacity available and this will leave supply chains vulnerable to any further pressure. The question is how quickly ocean freight carriers can put diversions in place, particularly for vessels already en route to Baltimore or containers at the port waiting to be exported," Ms Stausbøll said.

Maryland Governor Wes Moore has declared a state of emergency and confirmed in a press conference that shipping in and out of the Port of Baltimore had been halted, saying that it was too soon to determine how long it would take to clear the waterway and for shipping to resume.

Danish container shipping giant Maersk has posted a statement saying it will reroute its services and omit the Port of Baltimore "for the foreseeable future".

"Due to the damage to the bridge and resulting debris, it will not be possible to reach the Helen Delich Bentley port of Baltimore for the time being. In line with this, we are omitting Baltimore on all our services for the foreseeable future, until it is deemed safe for passage through this area," Maersk said.

Cargo destined for Baltimore that is already on the water will be discharged in nearby ports, with over-land transport used to reach Baltimore, according to the company.

"Please note that for cargo set to discharge in Baltimore, delays may occur, as they will need to discharge in other ports. We are keeping a close eye on the safety situation in the area and are continuing to assess the viability of transport through the area. We will inform you of any changes that may impact your cargo. We are deeply concerned by this incident and are closely monitoring the situation. We understand the potential impact this may have on your logistics operation, and will communicate to our customers once we have more details from authorities."

Analysis by Container xChange, a digital platform for container leasing and trading transactions, agrees with that of Xeneta, with a customer advisory shared by the group saying specialised cargo and bulk handling could be the shipping sectors most impacted by the collapse of the Francis Scott Key bridge.

"Delays in cargo movement could lead to inventory shortages, affecting businesses that rely on timely deliveries, like the automotive industry which requires assemblies coming from different parts of the world," Container xChange said. "Companies should prepare to face higher transport costs as they are forced to seek alternative routes to bypass the affected area. These additional costs could result in increased prices for goods, impacting both businesses and consumers."

Container xChange said the port ranks at or near the top in the lists of US ports handling farm and construction machinery, automobiles, imported forest products, imported sugar, imported gypsum and exported coal. The port’s infrastructure, including a deep channel and large cranes, also allows it to accommodate massive container ships.

"While the magnitude of the impact is yet to be determined, the disruption in traffic and operations at the port could lead to significant economic losses. The port generates nearly US$3.3Bn in total personal income and supports over 15,000 direct jobs, with an additional 139,000 jobs connected to port work," Container xChange said.

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