Two signals from the Red Sea: ships are returning, risks are not gone
TL;DR: The great Cape of Good Hope diversion is starting to loosen: carriers are gradually increasing Suez Canal transits, shifting capacity back from the Cape routing onto the Red Sea-Suez lane. The market impact is already visible — Drewry's WCI Asia-Europe rates are falling faster (Shanghai-Genoa down 10% to $4,368/FEU and Shanghai-Rotterdam down 5% on Sep 3), and Asia-Europe blank sailings collapsed from four to one. But resumption is not the end of the crisis: August's Red Sea attacks still cost lives, war risk claims have topped $2 billion, and Mitsui OSK sees Hormuz risk running through year-end. Gradual and reversible are the two keywords of this Suez return. Here is the progress, the timeline, the rate transmission, and what it means for your bookings.
1) The latest: ships are starting to flow back through Suez
Per Drewry's Sep 3 weekly container report, carriers are increasing transits through the Suez Canal, and more capacity is expected to return as services shift away from the longer route around the Cape of Good Hope. Market-side confirmation is arriving in step: Asia-Europe blank sailings fall from four this week to just one next — capacity moving from "withdrawn by blanking" to net inflow — and industry reporting shows Asia-Europe spot rates easing as carriers gradually return to Suez.
One caveat: this is the early, tentative stage of resumption. A few carriers resumed selected sailings first after security assessments improved; more services are following. "Full recovery" remains a distance away, and schedules and capacity structures will keep adjusting for weeks.
2) Why now: Cape costs and improving security assessments
Two triggers. First, the cost disadvantage of the Cape diversion: routing around the Cape adds roughly 10 days of sailing and significantly higher fuel and operating costs. With Europe-bound volumes soft and rates falling, carriers still diverting are at a clear cost disadvantage — the first movers back through Suez gain a cost and transit-time edge. Second, marginally improved security assessments: from late August, several carriers judged the Red Sea / Bab el-Mandeb outlook better, clearing the way for a first wave of returns.
Together they turn "return to the shortest route" from a risk decision into a competitive one — which is why resumption, once started, tends to reinforce itself: holdouts lose on both rate and lead time.
3) The timeline: from the Red Sea crisis to resumption signals
- Late 2023 - early 2024: the Red Sea crisis erupts; major carriers divert en masse around the Cape of Good Hope, and the diversion becomes the east-west norm
- Mar-Apr 2026: Middle East tensions escalate again, hitting lanes and rates (earlier briefing)
- June 2026: the Iran conflict escalates and Hormuz transits are disrupted, with container rates nearing $9,000; Washington and Tehran sign an MoU and reopen the strait in mid-to-late June (Hormuz briefing)
- July 2026: the ceasefire breaks; the US and Iran settle into "fighting while talking," with Hormuz transits staying well below pre-conflict levels
- August 2026: the US-Iran MoU expires without extension; Red Sea attacks still cause casualties, but security assessments for the Suez lane start improving
- Late Aug - early Sep 2026: carriers begin returning to Suez — Asia-Europe blankings collapse and rates accelerate downward, i.e., the resumption covered here
Note: the Strait of Hormuz and the Red Sea-Suez route are two separate risk sources; this timeline focuses on the latter. For the latest on Gulf lanes, see our Hormuz briefing.
4) Rate transmission: Asia-Europe enters a down-channel
The transmission path is straightforward: diversion ends → effective capacity rises → rate support weakens. The WCI data confirms it — Shanghai-Genoa fell 10% in a week to $4,368/FEU and Shanghai-Rotterdam 5% to $4,092/FEU, and Drewry expects further easing next week. That sits in sharp contrast with a transpacific that blanked twice as many sailings and printed new highs the same week: the two big east-west trades have formally entered a "scissors" phase, and rate analysis now has to run lane by lane (see our September rate report).
The medium-term angle is worth watching too: if the capacity parked on the Cape routing keeps flowing back, Europe's supply loosening could extend into Q4 — but carriers can equally offset with blank sailings and slow steaming. The slope of Europe's decline depends on the race between resumption speed and capacity discipline.
5) Risks are not zero: gradual and reversible
- Attacks continue: a Houthi attack in the Red Sea killed six people in mid-August; the security situation has not fundamentally improved
- War risk costs stay high: industry tallies put shipping war-risk claims above $2 billion since this conflict began, with attacks spreading beyond Hormuz waters
- Carriers stay cautious: Mitsui OSK (MOL) sees risk to Hormuz shipping running through year-end, and industry assessments of Middle East waters remain conservative
- Resumption is reversible: if security deteriorates, returning carriers can divert again at short notice — the rate and transit-time improvements are not locked in
For exporters, that boils down to one line: plan around the Suez return as a tailwind, but do not promise it to customers as a certainty.
6) What it means for your shipments
- Transit time: Asia-Europe via Suez saves roughly 10 days versus the Cape routing, so overall Europe lead times should improve; schedules are still settling, so keep your buffers
- Negotiating: a down-channel market equals a bargaining window — compare widely and lock space once a good number lands (strategy in the September rate report)
- Insurance: when buying marine cargo insurance, confirm item by item whether war risk cover applies and at what rate — Red Sea war-risk premiums remain elevated even as transits resume
- Routing: confirm in writing whether your booking actually routes via Suez or the Cape; the transit-time and cost gaps are material, especially on Middle East / Red Sea related lanes
- Alternatives: for deadline-critical Europe cargo, the China-Europe rail block trains remain a dependable hedge against ocean uncertainty
- Have a Plan B: if the resumption reverses, important cargo needs a second shipping plan ready to go
7) Closing
The Suez resumption signal is one of the most consequential turn variables in the east-west market for the second half of 2026: it sets the slope of Europe's rate decline and pulls on Middle East lane costs. We will keep tracking the resumption and its rate transmission and update this post as it develops. For shippers, the playbook right now is clear — use the negotiating window on Europe, confirm routing and insurance terms, and keep buffers for a reversal.
If you ship to Europe, the Mediterranean or the Middle East and need ocean export support, contact Mighty Shipping — we can verify routing options, war-risk terms and space protection for your cargo.