TAIPEI (TVBS News) — Taiwan's shipping companies Evergreen Marine Corp. and Yang Ming Marine Transport Corp. have opted not to follow in the wake of global container shipping giant Maersk's decision to resume its Red Sea route, according to reports on Monday (Dec. 25).
Maersk announced on Sunday (Dec. 24) that it would reinstate the route due to the deployment of multinational naval task forces amid the "Red Sea crisis," which has caused global market volatility.
Maersk has confirmed that the U.S.-led multi-nation security initiative, "Operation Prosperity Guardian" (OPG), has been established and deployed. With the operation in place, maritime trade can pass through the Red Sea/Gulf of Aden and resume using the Suez Canal as a trade corridor between Asia and Europe.
This move follows increased violence from Yemen's Houthi rebels supporting Hamas against Israel and Houthi's attacks on merchant ships in the Red Sea.
Consequently, the world's top ten shippers, Maersk included, chose to navigate around the Cape of Good Hope and avoid the Red Sea, resulting in increased freight charges, insurance costs, and oil prices.
While Maersk considers the establishment of the OPG a highly welcome development for the entire industry, the company warns that despite reopening the Red Sea route, the overall risk in the region has yet to be eradicated.
Maersk's decision has led to concerns about a surge in container prices and resulted in a significant decline in Evergreen and Yang Ming's stock prices.
Concerning freight rates, the day after Maersk announced the resumption of its Red Sea operations, the SCFI index for European shipping liners rose dramatically by 21.7%, with the American line surging by 8.4%.