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Red Sea Crisis

Suez Canal revenue drops by almost half due to Red Sea crisis

Photo: Adobe Stock container ship passing through Suez canal
The revenue of Egypt's Suez Canal has declined by almost half this year following attacks on shipping in the Red Sea by the Houthi which have seen many vessels divert via the Cape of Good Hope.

According to Egypt’s Al-Mal News, data released this week for last month shows that revenues of the Suez Canal dropped by 64.3% to approximately $337.8 million, compared to $648 million recorded in May 2023.

The number of vessels transiting the canal in May also dropped to 1,111, which is lower than 2,396 ships that crossed during a similar period last year. As a result of reduced ship traffic, the cargo volume passing through the Suez Canal dropped by 68.5% last month to about 44.9 million tonnes. In May 2023, the total cargo tonnage was 142.9 million tonnes.

The Suez Canal Authority Chief Osama Rabie said in media statements last week that the canal's income decreased to $428 million in January compared to $804 million in the same period in the previous year. According to the head of the Suez Canal Authority Osama Rabie, the traffic of ships in the waterway witnessed a 30% decline compared to the same period of 2023.

During the fiscal year 2022/2023, the returns from the Suez Canal hit a record-breaking $9.4 billion.

The Suez Canal Authority (SCA) has extended fee discounts for a range of vessels on selected long-distance trades. Initially, SCA had introduced the fee reductions back in January, with some discounts as high as 75% for product tankers and crude carriers on voyages between Americas and Asia.

The new extension of discount rates will be valid until end of the year, covering 12 categories of ships including bulk carriers, container ships and LNG carriers.