Get 40% Off
👀 👁 🧿 All eyes on Biogen, up +4,56% after posting earnings. Our AI picked it in March 2024.
Which stocks will surge next?
Unlock AI-picked Stocks

Factbox-How companies are responding to attacks on ships in the Red Sea

Published 08/01/2024, 14:07
Updated 08/01/2024, 14:13
© Reuters. FILE PHOTO: A forklift carries a shipping container at the Red Sea port of Hodeidah, Yemen June 24, 2018. REUTERS/Abduljabbar Zeyad/File Photo

(Reuters) -Attacks on vessels by Iranian-backed Houthi militants in Yemen have disrupted international commerce on the shortest shipping route between Europe and Asia.

The attacks, targeting a route that accounts for about 15% of the world's shipping traffic, have pushed several shipping companies to reroute their vessels.

Below are companies' responses to the disturbances (in alphabetical order):

AB FOODS

The Primark-owner is monitoring the situation, but its supply chains are capable of some adjustment, a company spokesperson said, adding that so far it saw no need to be concerned.

BASF

The German chemical company does not see disruptions to raw material supply or product distribution, but it's closely monitoring the situation, a company spokesperson said.

BP (LON:BP)

The oil major on Dec. 18 said it had temporarily paused all transits through the Red Sea.

COVESTRO

The German chemicals maker said any possible increases in transit times would not impact its product supply.

DANONE

The French food group said in December that most of its shipments had been diverted, which would increase transit times. Should the situation last beyond 2-3 months, Danone will activate mitigation plans, including using alternate routes via sea or road wherever possible, a spokesperson said.

DHL

The German logistic company, which does not operate ships but uses them to transport containers, on Jan. 8 advised its customers to take a close look at how they manage inventories.

ELECTROLUX

The Swedish home appliances maker set up a task force to find alternative routes or identify priority deliveries to try to avoid any disruption. It sees a limited impact on deliveries for now.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

EQUINOR

The Norwegian oil and gas firm on Dec. 18 said it had rerouted vessels that had been heading towards the Red Sea.

ESSITY

The Swedish hygiene products maker is monitoring the situation and staying in contact with impacted suppliers to ensure continued flow of goods, The company sees a limited impact as a low percentage of its supplies move through the Suez Canal.

EUROPRIS

The Norwegian retailer, which imports 35-40% of goods sold from Asia via sea freight, on Jan. 5 told Reuters it had not considered other shipping options as this would increase costs.

Europris reiterated the longer shipping times were within its safety margin and no significant challenges were expected, adding that it saw no need to adjust the outlook due to its fixed price agreement on sea freight for 2024.

GEELY

Geely, China's second-largest automaker by sales, said on Dec. 22 its EV sales would likely be impacted by a delay in deliveries, as most of the shipping firms it uses to export EVs to Europe sail around the Cape of Good Hope.

IKEA

The Swedish ready-to-assemble furniture retailer said on Dec. 19 that the situation would result in delays and may cause availability constraints for certain products.

"We are evaluating other supply options to secure the availability of our products," it added.

KAPPAHL

The Swedish fashion retailer on Jan. 8 said it was affected as it ships via Maersk. "We expect some effects, maybe some delays of new goods, but how large the effect will be is still very uncertain," it told Reuters.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

KEMIRA

The Finnish chemicals company said on Dec. 19 that shipping companies' decisions to reroute vessels would affect some of its international routes, but not in any significant way at least in the short term.

"There is currently spare capacity on the market and waiting times at ports are reasonably good," a Kemira spokesperson said.

KID

The Norwegian home decor retailer told Reuters on Jan. 5 it saw no consequences for the stock in store, but added it was unclear how the company would be affected. Kid said it did not ship via Maersk.

KONE

The Finnish elevator maker said the situation may in some cases delay shipments by 2-3 weeks, but a majority of its customer deliveries should stay on schedule. Kone said it had prepared for the disruptions by seeking alternative delivery methods and routes.

LIDL

Lidl unit Tailwind Shipping Lines, which transports non-food goods for the discount supermarket chain and goods for third-party customers, said it was sailing around the Cape of Good Hope for now.

MEDIAMARKTSATURN

The German electronics retailer, and Ceconomy unit, said on Dec. 21 it did not expect the situation to affect its supply chain or availability of products during the Christmas season.

"If the situation persists for longer, we cannot rule out the possibility that we may also experience isolated effects on the availability of goods in the medium term," it added.

MOSAIC

The U.S. fertilizer company said on Dec. 18 it had rerouted a couple of U.S.-bound shipments around the Cape of Good Hope.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

TSMC,

The world's top contract chipmaker said on Dec. 19 it did not anticipate a significant impact on its operations.

VOLKSWAGEN

The German carmaker on Dec. 20 said rerouting of shipments would result in around two weeks longer journeys, adding it had not seen any problems so far.

VOLVO CAR

The Swedish automaker told Reuters it was affected by the shipping hindrances and was investigating the potential impact, but saw no impact on its ability to reach global wholesale and production targets.

WHIRLPOOL

The appliances maker said in December it was closely monitoring logistics issues in the region to help mitigate risks as they arise, adding there was no impact to its business so far.

YARA

The Norwegian fertilizer maker told Reuters it was only mildly impacted for now, but said the Red Sea was an important supply route for it.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.