Clearing the Suez Canal Took Days. Figuring Out the Costs May Take Years.

TOKYO — It took six days to prise free a giant container ship that ran aground and clogged the Suez Canal, one of the world’s most crucial shipping arteries. It could take years to sort out who will pay for the mess.

Cargo companies, insurers, government authorities and a phalanx of lawyers, all with different agendas and potential assessments, will not only need to determine the total damage, but also what went wrong. When they eventually finish digging through the morass, the insurers of the ship’s Japanese owner are likely to bear the brunt of the financial pain.

The costs could add up quickly.

There are the repairs for any physical damage to the Ever Given, the quarter-mile-long ship that got stuck in the Suez. There is the bill for the tugboats and front-end loaders that dug the beached vessel out from the mud. The authority that operates the Suez Canal has already said the crisis has cost the Egyptian government up to $90 million in lost toll revenue as hundreds of ships waited to pass through the blocked waterway or took other routes.

And the stalled ship held up as much as $10 billion of cargo a day from moving through the canal, including cars, oil, livestock, laptops, sneakers, electronics and toilet paper. Companies delivering goods may have to pay customers for missed deadlines. If any agricultural goods went bad, producers may look to recoup lost revenue.

Richard Oloruntoba, an associate professor of supply chain management at the Curtin Business School in Perth, Australia.

Jeff N.K. Lee, a lawyer in Taipei who specializes in commercial and transportation law.

“While the ship is just parked there, the cargo isn’t actually being damaged,” Mr. Lee said. “The only damage is that it’s delayed.”

“Say I have a batch of cloth, and on top of the time it took to come to Taiwan, it got stuck for six or seven days,” he said. “It just sat there. Will it go bad? It won’t.”

There is a caveat. The ship’s owner could have to pay for cargo delays, if its crew is found to be at fault for the accident.

Some so-called third-party claims related to delayed cargo may be covered by yet another insurer for the ship, the UK P&I Club. The same goes for any claims by the Suez Canal Authority, which operates the waterway and might file over any loss of revenue.

Nick Shaw, chief executive of the International Group of Protection and Indemnity Clubs, the umbrella group that includes the UK P&I Club, said the insurer would “make decisions together with the shipowner as to which ones had validity and which ones are illegitimate.”

Adding to the complexity of the Suez accident are the layers upon layers of insurance. Reinsurers, companies that covers the risk of other insurance companies, come into play for claims above $100 million. Between insurance and reinsurance, the ship’s owner has coverage for those third-party claims up to $3.1 billion, although few experts believe the damages will run that high.

The sheer size of the Ever Given makes the situation all the more labyrinthine. Aside from time of war, the Suez Canal has never been blocked quite so spectacularly or for as long a time as it was with the Ever Given, and this is the biggest ship to run aground.

The ship is as long the Empire State Building is tall, with the capacity to carry 20,000 containers stacked 12 to 14 high. The Ever Given is one of a fleet of 13 in a series designed by Imabari, part of a push to lower the costs per container and make the ships more competitive in an increasingly fierce market dominated by Chinese and South Korean shipbuilders.

“The bigger the ships get, the risk is whenever you have an incident like this is that you are putting more of your eggs into one basket,” said Simon Heaney, senior manager of container research at Drewry UK, a shipping consultancy. “So the claims will magnify.”

Raymond Zhong and Amy Chang Chien contributed reporting from Taipei, Taiwan. Vivian Yee contributed from Cairo and Makiko Inoue, Hisako Ueno, Hikari Hida from Tokyo.

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Ship Is Freed After a Costly Lesson in the Vulnerabilities of Sea Trade

SUEZ, Egypt — For six days, billions of dollars’ worth of international commerce sat paralyzed at either end of the Suez Canal, stalled thanks to a single giant container ship apparently knocked sideways by a powerful southerly wind.

The ship’s insurers and the canal authorities summoned the largest tugboats in the canal, then two even larger ones from further afield. They deployed diggers, front-end loaders and specialized dredgers to guzzle sand and mud from where the ship was lodged at both ends. They called in eight of the world’s most respected salvage experts from the Netherlands.

Day and night, with international pressure bearing down, the dredgers dredged and the tugboats tugged.

But not until the seventh day, after the confluence of the full moon and the sun conjured an unusually high tide, did the ship wriggle free with one last heave shortly after 3 p.m., allowing the first of the nearly 400 ships waiting to resume their journeys by Monday evening.

reconstruction of the ship’s movements through the narrow section of the canal north of the port of Suez shows the Ever Given weaving back and forth from one side of the canal to the other almost as soon as it entered the channel, gathering speed until the 224,000-ton ship tops 13 knots, or about 15 miles per hour.

internet memes about the epic traffic jam piled up, the Suez Canal Authority and the ship’s owner and insurer scrambled tugboats and dredging equipment to the scene. By the day after the grounding, they had called in a highly regarded team of salvage experts from Smit Salvage, a Dutch company.

“The time pressure to complete this operation was evident and unprecedented,” Peter Berdowski, chief executive of Royal Boskalis Westminster, Smit’s parent company, said in a statement on Monday.

images emerged on social media of the ship, for so long diagonal, once again parallel with the canal.

celebrated the moment on Twitter, writing that “Egyptians have succeeded today in ending the crisis of the stuck ship in the Suez Canal despite the great complexities surrounding this situation in every aspect.”

Ms. Stausboll said that the authorities’ often overly rosy projections during the past week left many shipowners confused about what to believe. “A lot in the shipping community would wish there had been more clarity about what was going on in Egypt from the authorities,” she said. “It does harm your reputation.”

In the absence of a faster, cheaper option, however, the Suez Canal will remain a key artery for shippers, she said. And she pointed out that most ships, including large ones, have navigated the canal without incident in the past.

Shippers have, in any case, a more pressing concern: how to resolve the chain reaction of delays that may ripple out for weeks or months even after the Suez backlog clears, as it was beginning to do by Monday night.

The first ship to pass through the canal after the Ever Given got out of the way was the YM Wish, a 1,207-foot-long Hong Kong-flagged container ship that exited the canal at about 9:15 p.m.

If there is schadenfreude among ships, the YM Wish was perhaps not feeling it. VesselFinder.com reported the YM Wish ran aground in the Elbe River in Germany only six years ago. In its case, however, it took less than a day to float again.

Marc Santora contributed reporting from London, Nada Rashwan from Ismailia, Egypt, and Thomas Erdbrink from Amsterdam.

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‘A Very Big Problem.’ Giant Ship in the Suez Remains Stuck.

MANSHIYET RUGOLA, Egypt — The gargantuan container ship that has blocked world trade by getting stuck aslant the Suez Canal has towered over Umm Gaafar’s dusty brick house for four days now, humming its deep mechanical hum.

She looked up from where she sat in the bumpy dirt lane and considered what the vessel, the Ever Given, might be carrying in all those containers. Flat-screen TVs? Full-sized refrigerators, washing machines or ceiling fans? Neither she nor her neighbors in the hamlet of Manshiyet Rugola, population 5,000-ish, had any of those at home.

“Why don’t they pull out one of those containers?” joked Umm Gaafar, 65. “There could be something good in there. Maybe it could feed the town.”

The Japanese-owned Ever Given and the nearly 300 cargo ships now waiting to traverse the Suez Canal, one of the world’s most critical shipping arteries, could supply Manshiyet Rugola many, many times over.

ran aground on Tuesday, blocking all shipping traffic through the canal, global supply chains churned closer to a full-blown crisis.

Already, shipping analysts estimated, the colossal traffic jam was holding up nearly $10 billion in trade every day.

“All global retail trade moves in containers, or 90 percent of it,” said Alan Murphy, the founder of Sea-Intelligence, a maritime data and analysis firm. “So everything is impacted. Name any brand name, and they will be stuck on one of those vessels.”

take the long way around the southern tip of Africa, a journey that could add weeks to the journey and cost more than $26,000 per extra day in fuel costs.

In Manshiyet Rugola, whose name translates to “Little Village of Manhood,” traffic jams of any kind would be difficult to imagine in usual times.

Donkey carts piled high with clover bumped down semi-paved lanes between low brick houses and green fields lined with palm trees, trash and animal dung. A teenager hawked ice cream from his motorcycle. Roosters offered profane competition to the noontime call to prayer. Until the Ever Given showed up, the minarets of the unimposing mosques were the tallest structures around.

“Do you want to see the ship?” a young boy asked a pair of visiting journalists, bobbing in excitement under the window of their car. Ever since the earthquake-like rumble of the ship running aground jolted many awake around 7 a.m. Tuesday, the Ever Given had been the only topic in town.

“The whole village was out there watching,” said Youssef Ghareeb, 19, a factory worker. “We’ve gotten so used to having her around, because we’ve been living on our rooftops just watching the ship for four days.”

It was universally agreed that the view was even better at night, when the ship glowed with light: a skyscraper right out of a big-city skyline, lying on its side.

“When it lights up at night, it’s like the Titanic,” said Nadia, who, like her neighbor Umm Gaafar, declined to give her full name because of the security forces in the area. “All it’s missing is the necklace from the movie.”

Umm Gaafar had asked to go by her nickname so as not to run afoul of the government security personnel who had passed through, warning residents not to take photos of the canal and generally spreading unease. Nadia said she was too intimidated to take pictures of the ship at night, though she badly wanted to.

Villagers and shipping analysts had the same question about the Ever Given, if rooted in different expertise. The ship’s operators have insisted that the ship ran aground because of the high winds of a sandstorm, with the stacked containers acting like a giant sail, yet other ships in the same convoy passed through without incident. So had previous ships in previous storms, the villagers pointed out.

“We’ve seen worse winds,” said Ahmad al-Sayed, 19, a security guard, “but nothing like that ever happened before.”

Shipping experts said the wind might well have been the major factor, exacerbating other physical forces, but suggested that human error may also have come into play.

“I am highly questioning, why was it the only one that went aground?” Captain Foran said. “But they can talk about all that later. Right now, they just have to get that beast out of the canal.”

Nada Rashwan contributed reporting.

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Suez Canal Blocked After Container Ship Gets Stuck

CAIRO — An enormous container ship became stuck while traversing the Suez Canal late Tuesday, blocking traffic through one of the world’s most important shipping arteries and threatening to add one more burden to a global shipping industry already battered by the coronavirus pandemic.

The ship, which was heading from China to the port of Rotterdam in the Netherlands, ran aground amid poor visibility and high winds from a sandstorm that struck much of northern Egypt this week, according to George Safwat, a spokesman for the authority that oversees the canal. The storm caused an “inability to direct the ship,” he said in a statement.

By Wednesday morning, more than 100 ships were stuck at each end of the canal, which connects the Red Sea to the Mediterranean and carries roughly 10 percent of worldwide shipping traffic.

Dozens of tugboats raced to try and wrench it free as crews on the land brought heavy equipment to dig out the land where it sat wedged.

posted on Tuesday evening. “Looks like we might be here for a little bit …”

The Suez Canal is a key artery for oil flows from the Persian Gulf region to Europe and North America. Roughly 5 percent of globally traded crude oil and 10 percent of refined petroleum products passed through the canal before the pandemic, estimated David Fyfe, chief economist at Argus Media, a market research firm.

After the canal was snarled, there was a 2.85 percent jump in the price of Brent crude, the international benchmark, on Wednesday to $62.52 a barrel.

But Mr. Fyfe said that because the demand for oil remained relatively weak amid the pandemic, a short-term outage is unlikely to have a lasting impact on the market.

“I don’t think this is going to fundamentally change market sentiment,” he said. “A lot will depend on how quickly they can get the vessel cleared.”

Vivian Yee reported from Cairo, and Peter S. Goodman from London. Nada Rashwan contributed reporting from Cairo, and Stanley Reed from London.

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32 Rescued From Sinking Fishing Boat: ‘Every Moment Counts’

OTTAWA — The situation looked dire for the crew of the Atlantic Destiny. A fire first knocked out power onboard the scallop trawler and then it began taking on water. More than 130 miles away from its home port in Nova Scotia, the 144-foot-long ship was hopelessly bobbing up and down on waves 40 to 80 feet high.

But while the Atlantic Destiny ultimately sank, a joint rescue effort by Canada and the United States meant that all its 32 crew members had been rescued before it went down.

“The weather was probably some of the worst weather I have actually executed a hoist operation in,” said Cmdr. David McCown, a pilot on a United States Coast Guard helicopter that rescued 13 of the ship’s crew.

The rescue effort began when the Atlantic Destiny sent out a distress call on Tuesday because of the fire. Ships from the United States and Canadian Coast Guards were dispatched; the Royal Canadian Air Force sent two rescue helicopters and an airplane from Nova Scotia, while another pair of helicopters and a plane took off from a U.S. Coast Guard base in Cape Cod.

Cmdr. Aaron O’Brien, the lead officer of a Canadian Coast Guard ship, the Cape Roger, traveled overnight to reach the sinking trawler. He charged ahead for about 11 hours, buffeted by side winds of up to 90 miles an hour, navigating against the wind through rough seas that he would normally cross at a near walking pace. There was no time to waste.

“In a case like that, every moment counts,” Commander O’Brien said. “So we were hammer down as much as possible.”

The Canadian Air Force arrived first and completed the dangerous task of dropping two search and rescue technicians onto the sinking fishing ship. While one prepared the crew for evacuation, the other worked to slow down the ship’s intake of water.

The rescue began by lifting crew members put in a rescue basket into a helicopter, a maneuver that had to be coordinated with the huge ocean swells. Commander McCown said that the pilots and their crews used night vision goggles to keep an eye on the waves, sometimes the height of an apartment building, throughout the process.

Because the fishing ship’s crew had been able to stay onboard and out of the frigid water, Commander McCown said that they were mostly in good shape, if very shaken.

When his helicopter reached its weight limit with 13 members of the sinking ship’s crew, it immediately made the long flight back to Nova Scotia. When it landed, he estimated that there was only enough fuel left for another 40 minutes of flight.

Two other helicopters rescued 15 more.

One helicopter stayed behind, while the two search and rescue technicians from the Canadian military and four Atlantic Destiny crew members remained on the sinking ship in an effort to rescue it by pumping water out.

But early Wednesday morning, they too decided it was time to leave.

Capt. Malcolm Grieve of the Canadian Air Force began trying to retrieve the remaining six in an effort that proved tricky. When his helicopter lowered a steel cable to start the process, the cable wrapped around a railing on the ship and had to be immediately cut loose. As a result, all his crew could do was lower some rescue boats and first aid supplies and wait for the Cape Roger to arrive after its all-night journey.

It appeared around 7:30 in the morning.

The last people on board, including the captain, climbed down a rope ladder into an inflatable boat sent from the Coast Guard ship at about 8 in the morning. Two and half hours later, the Atlantic Destiny sank.

“It was a total relief off my shoulders,” Commander O’Brien said of the successful rescue. “I’m just thankful that we could help someone in distress and that we could be there really at the right place at the right time.”

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