The Suez Canal reopening is a 2026 gift for commodities

THE business of shipping goods around the world has suffered shock after shock since 2000, culminating in the effective closure of the Red Sea and Suez Canal two years ago.

- By Javier Blas

Don't say it too loud, but there's a good chance the waterway can reopen in 2026, reducing transportation costs and easing the strain on global supply chains.

It's hard to overstate the canal's importance: It's a choke point for about 15% of global trade in goods - and double that for container traffic. It's been effectively closed since November 2023 when the Houthis, a rebel group controlling large swathes of Yemen, started attacking commercial vessels in the southern mouth of the Red Sea, sinking at least four ships, setting ablaze several others, and killing several mariners.

The closure forced shipping companies to take the long route around the southern tip of Africa, adding 10 days of sailing time from Asia to Europe and millions of dollars in extra costs. ING Bank NV estimates the detour is currently absorbing around 6% of global fleet capacity due to the longer voyage.

It was the culmination of five chaotic years for the shipping industry, which included the impact of COVID-19, the US-China trade war, the grounding of a huge container ship in the Suez Canal in 2021, and the disruption to Atlantic-Pacific traffic in 20232024 due to a drought affecting the Panama Canal.