CMA CGM has announced that its INDAMEX service will now transit the Suez Canal for both fronthaul and backhaul voyages between India/Pakistan and the U.S. East Coast, marking a significant step towards the potential return of container shipping to the Red Sea. The CMA CGM Verdi will be the first vessel to complete this route, departing from Karachi to New York on January 15. Utilizing the Suez Canal reduces the transit time to 77 days, two weeks shorter than the alternative route around the Cape of Good Hope.
Peter Sand, Chief Analyst at Xeneta, noted that while this move is promising, a full-scale return to the Red Sea is still uncertain. CMA CGM has previously tested Suez transits on select voyages, particularly when cargo loads were lighter. Four additional vessels in the INDAMEX service are set to follow suit before the new schedule is fully implemented.
Other major carriers like Hapag-Lloyd and Maersk have yet to establish a timeline for returning to the Red Sea, while ZIM is awaiting insurance approval. Sand cautions that the security situation remains delicate, with risk assessments ongoing due to the threat posed by Houthi militia attacks in the region.
The INDAMEX service’s quicker transit could lead to a reduction in capacity, as two ships will be dropped from the service. With current overcapacity in the container shipping market and declining spot rates—down 57% and 53% for Far East fronthauls to the U.S. East Coast and North Europe, respectively—any significant return of capacity could further pressure freight rates, pushing carriers closer to losses.
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