From China to the EU it adds roughly 1/3rd to the time, which is a decent proxy for cost. There are savings in not having to pay Suez fees but these don't seem to make a huge affect to shipping costs.

It's probably worth adding that going round the cape doesn't add just more cost to fuel and time, insurance for cargo down there isn't cheap either as the weather is very changeable.

It's a great proxy for cost, but price has more to do with availability than with cost. I'd expect price to go up a lot more than 1/3rd, especially if this drags on.

Right, price is driven by supply and demand. If your ships have to travel 4/3 as far, you have ships available at 3/4 of the previous rate, so the supply of shipping went down. Demand didn't, so the price goes up.

If any Norwegians are reading, which are shipping nerds by virtue of geography, speculating in this market is essentially why John Fredriksen, the Warren Buffett of shipping, is rich.

Shifts in ship availability causes waves of bankruptcy, and either gluts or shortages (whatever happens to be most inconvenient at the time).

Perun has a pretty nice long video presentation that talks about the factors involved and what they may mean for shipping: https://www.youtube.com/watch?v=8GKlKYQDDcQ

Makes for good background listening.

I guess it's the same as when the Suez canal was blocked [1] . It will result in about 2 weeks longer transportation time. Don't know about costs.

[1] https://en.wikipedia.org/wiki/2021_Suez_Canal_obstruction

Container ships use in the region of 150 to 250 metric tons of fuel per day, so $75,000 to $125,000 in fuel alone.

Spread out over thousands of containers that doesn't seem like a huge penalty.

We'll see, if we care to look which I don't anymore since I'm not involved in sea freight for a while bow, how rates from Asia to Europe change. Because this rate change is what matters, not the additional cost for carriers.

The extra time necessary, thus lower throughout, thus availability issues, will likely be the bigger problem than fuel.

Except that back then people where drawing world end scenarios while today it sounds like “just a small detour”.

Possibly because the people shouting about world-ending scenarios from the blocking of the Suez were being hyperbolic.

Or the remaining 5% are really important.

It's not just shipping costs and times, but also (and perhaps most importantly) shipping's total capacity. The same fleet of ships can now make substantially less trips, which means that substantially less goods will be transported between Europe and Asia. Perhaps rising costs of shipping on this route will divert some ships from other routes around the world here, but overall outcome across entire world has be to less maritime commerce, leading to increase in prices of goods.

The trip is about 15 or so days, with the associated fuel costs. Granted, fuel costs are distributed across tens of thousands of containers, so the delay will probably be the bigger issue.

With renewed unrest in the area (140mi 280km to Gaza), cost of sinking the entire cargo vs an extra two weeks is also a consideration.

He estimated ~2% consumer price increase in a diff comment.

A two to three week longer transit time will increase sales prices of the imported product by 2%? I' d like to see the calculation behind that assumption...

We probably can't quickly pull enough extra ships out of our hats to make up for the extra time they're spending in transit, so total shipping capacity will decrease. That may well have a large impact on shipping prices.