Container shipping lines are scrambling to get back into the Suez Canal with full-scale transits resuming by the first quarter of 2027. According to reports, Ocean Network Express (ONE) and HMM are planning to join the growing band of carriers transiting the Red Sea corridor, despite the ongoing fighting in the Arabian Gulf, and continuing security anxieties over the Houthi attacks.
Some in the industry have suggested that shipping companies may have been given private assurances over the safety of their vessels transiting the Bab el Mandeb Strait and the Red Sea. The return of traffic is a massive change after years of detours around the Cape of Good Hope
Figures released by BIMCO show container ship capacity going through the Red Sea and Suez Canal is now over 50% of the levels seen before the Iran war. Weekly container ship capacity transiting the canal averaged 753,000 TEU in the first two weeks of October, compared with 1,457,000 TEU in the same period of 2023, according to Clarksons Research.
The traffic downturn started late in 2023, after the outbreak of the Gaza conflict and subsequent threat to commercial shipping posed by the Houthi movement. Carriers in a number of vessel segments answered by rerouting vessels around the Cape of Good Hope, with weekly container capacity through Suez dropping from 1.29 million TEU to 330,000 TEU.
In the following months the dislocation grew worse. Average weekly container ship capacity transiting the canal between early February 2024 and mid-2026 was just 141,000 TEU, or around 11% of the capacity seen in the corresponding weeks of 2023, said Niels Rasmussen, BIMCO’s chief shipping analyst.
Major carriers prepare to rejoin the Suez route
The recovery is gaining momentum. Linerlytica, a shipping consultancy, reports that more than 50 container ships with capacities of at least 4,000 TEU are now operating through the Red Sea each week. The firm expects a full-scale return to the Suez Canal route by the first quarter of 2027.
ONE and HMM are anticipated to be the next major carriers to resume the route. Their expected return would leave Evergreen, Yang Ming and Zim as the only remaining major carriers yet to make the switch, according to Linerlytica.
The shift is already reflected in the service networks operated by the industry’s leading alliances. As of this week, all four major alliances are offering regular westbound services from Asia to Northern Europe via the Suez Canal.
These include the Premier Alliance’s FE1 service, alongside Gemini Cooperation services NE1/AE2 and AE4/AE5. The OCEAN Alliance has also returned its FAL3/NEU5 service to the corridor, while MSC has reinstated its Lion/FE5 service on the more direct Asia-Europe route.
The growing number of services using Suez marks a notable reversal of the routing decisions that reshaped container shipping following the security crisis in the Red Sea.
Shorter voyages could ease pressure on global capacity
The return to the canal is also changing the supply-demand balance across the container shipping market. BIMCO estimates that diversions away from Suez increased global container ship demand by approximately 10%, as vessels spent more time completing longer voyages around southern Africa.
That additional demand is now declining rapidly as carriers restore shorter routes between Asia and Europe. However, the overall market impact remains uncertain because the return to Suez has coincided with increased congestion at Asian ports.
Rasmussen noted that the full implications for shipping supply and demand have yet to become clear, with the reduction in sailing distances occurring alongside disruptions at major Asian gateways.
Port congestion in Asia has reportedly begun to ease as workers return to factories following the Golden Week celebrations. This improvement could further facilitate the release of capacity previously absorbed by longer voyages and delays.
Spot freight rates face renewed downward pressure
Linerlytica reports that spot freight rates remain under downward pressure as congestion eases and additional vessel capacity becomes available through the return of ships to the shorter Suez route.
The release of capacity previously tied up on voyages around the Cape of Good Hope is adding to the pressure on freight pricing. Nevertheless, carriers serving the Asia-Europe trade have continued trying to push spot rates higher during the second half of October.
The coming months will therefore be crucial in determining how quickly the return to Suez translates into lower freight rates and a more balanced deployment of container ship capacity. With ONE and HMM expected to join the recovery, the prospect of a broad industry-wide return by early 2027 is becoming increasingly tangible, although security risks and port congestion will continue to influence the pace of the transition.
