Suez Canal Authority Extends Discounts as Traffic and Revenues Plummet

Suez Canal Authority Extends Discounts as Traffic and Revenues Plummet

Over six months into the Red Sea crisis, the economic impact on Egypt’s Suez Canal is evident. Recent data shows a significant revenue drop of 64.3 percent to approximately $337.8 million in May 2024, compared to $648 million in May 2023, as reported by Al-Mal news. Vessel traffic also declined, with only 1,111 ships transiting the canal in May, down from 2,396 ships the previous year. Consequently, cargo volume fell by 68.5 percent to about 44.9 million tons, from 142.9 million tons in May 2023.

The ongoing Houthi attacks on merchant shipping in the Red Sea have forced major ocean carriers to avoid the Suez Canal, opting for the longer route around Africa. Egypt’s Finance Minister, Mohamed Maait, had projected that last year’s record-breaking $9.4 billion Suez Canal revenue might cushion the losses, but warned that prolonged Red Sea tensions could exacerbate the economic strain due to exchange rate fluctuations.

To enhance the canal’s competitiveness, the Suez Canal Authority (SCA) extended fee discounts for various vessels, including bulk carriers, containerships, and LNG carriers, until the end of the year. Additionally, yachts under 300 tons will receive a 50 percent discount on transit fees from July to October, aligning with the Egypt International Yacht Show.

Source: The Maritime Executive