Sudden! Houthi launches largest attack! High freight rates still attract these shipping companies to sail through the Red Sea

According to U.S. officials, there were about 50 commercial ships in the area at the time of the attack. Crews have reported being hit by rockets and drones, and no ships have been reported damaged by the attacks.

The U.S. Central Command reported that 18 drones, two anti-ship cruise missiles and one anti-ship ballistic missile launched by the Houthi armed forces at around 9:15 pm local time were intercepted by fighter jets and Graves aboard the USS Eisenhower aircraft carrier. The guided missile destroyers HMS Leigh, HMS Laboon and HMS Mason, as well as the Royal Navy destroyer HMS Diamond, were successfully shot down.

Despite the major attack by the Houthi armed forces on the evening of the 9th, small shipping companies in the Red Sea continued to operate. According to AIS data, four container ships still entered the danger zone on the morning of the 10th, and another six were entering the danger zone. Shipping analyst Lars Jensen said that CMA CGM and the Maersk Atlanta may also be in the area, but do not have AIS activated. While this major attack - the largest to date - may have put mainline operators on the back foot, smaller carriers have continued to traverse the area due to rate premiums in the area. Shipbrokers report that Milaha Line, X-Press Feeders and SeaLead Shipping have recently chartered vessels for Red Sea trade voyages.

A Singaporean broker pointed out that some small and medium-sized shipping companies, especially China's start-up operators, are still willing to serve the region and are looking to charter ships. Carriers can demand higher rates by shipping cargo to the Persian Gulf, where demand remains strong, or even via the Red Sea. Far East-Persian Gulf freight rates more than doubled year-on-year, reaching $2,340/TEU. Since last month, SeaLead Shipping, one of the largest shipping companies in the Persian Gulf, has chartered five container ships: Zhonggu Flow's 4,636 TEU "Zhonggu Xi'an" and "Zhonggu Kunming"; "Northern" Shipping's 3,534 TEU "Northern Discovery"; "Meratus Group's" 2,553 TEU "Marina Voyager"; Japanese shipowner Doun Kisen's 1,876 TEU "Bright Cosmos"; "Soon Fong" Shipping" of the 1560 TEU "Taichung" number.

Singapore-based X-Press Feeders has chartered Djibouti Shipping Company’s 1,118 TEU Africa Sun and Conbulk’s 2,902 TEU Palermo for the Red Sea trade. Notably, X-Press agreed to lease the 1998-built "Palermo" for six to nine months at a premium of $15,500 per day.

X-Press did not respond to a request for comment, but a spokesperson for SeaLead said the company took precautions when sailing in the Red Sea. "Key to this is the deployment of armed guards on board, ensuring full compliance with BMP rules and ensuring that SeaLead's vessels and voyages have no links or interests to Israel," the spokesman said. SeaLead is targeting Red Sea cargo and its fleet expansion has seen it Became the 18th largest liner operator.

Another broker said chartering vessels is challenging because not many owners are willing to risk having their vessels attacked by the Houthis.

In fact, a spokesman for SeaLead also pointed out that the company had to reschedule the delivery of some ships because some ship owners refused to let the ships pass through the Red Sea.

According to reports, some operators have issued statements saying that their ships will not go to Israel in case of attacks by the Houthis. At the same time, economic growth in the Middle East has prompted an increase in container shipping capacity in the region. There are currently about 150 ships deployed on the route from the Far East to the Persian Gulf, with a shipping capacity of 1.17 million TEUs, a year-on-year increase of 20%.

The latest report from consulting firm Linerlytica shows that as of January 7, the number of container ships diverted to the Cape of Good Hope due to the Red Sea crisis has increased to 354, with a capacity of 4.65 million TEUs, accounting for 16.4% of the global fleet. This number also accounts for 80% of all ships between the Atlantic, Mediterranean and Indian Oceans (that is, 80% of ships that originally passed through the Suez Canal now choose to bypass the Cape of Good Hope). This number is expected to continue to grow in the coming week, as most major shipping lines currently choose to detour around the Cape of Good Hope.

Linerlytica said these reroutings will result in capacity shortfalls of up to 40% from Asia to Europe and the U.S. East Coast in weeks 4 to 6, with freight rates expected to surge further in the coming weeks. Since the beginning of December last year, the Shanghai Export Container Freight Index SCFI has risen by 97%, and there is room for further growth in the coming weeks.

Additionally, delays are affecting the availability of containers back to Asia. According to data from Linerlytica, new box production has risen sharply since December, while the price of new boxes has increased by more than 20% in the past month. The company noted that to alleviate the situation, "the only way will be the delivery of new ships."