The Suez Canal Authority (SCA) has held talks with representatives of several major shipping companies to persuade them to resume using this crucial waterway connecting Asia and Europe.

Ossama Rabiee, Chairman of the Suez Canal Authority, met with representatives of 20 shipping companies and freight forwarding companies to discuss the development situation in the Red Sea and the Strait of Mandeb. Over the past two years, many container shipping companies and maritime enterprises have been forced to take the longer route around the Cape of Good Hope to avoid attacks by Houthi militants in the Red Sea region. Recently, the Houthi militants have ceased their attacks on commercial vessels in the Red Sea region.

According to the latest report from the Canal Authority, the tonnage passing through the Suez Canal increased by 10% year-on-year from July to October, with revenue rising by 14.2%. However, the growth in the number of vessels is smaller, at only 2%, indicating that the vessels passing through are larger in size compared to the previous year. Over the past four months, more than 4,400 vessels have transited the Suez Canal, with 229 vessels choosing to return.

Nevertheless, the authorities aim to have large shipping companies fully return. Notably, CMA CGM, which had previously dispatched small vessels through the Red Sea under the protection of the EU's Red Sea escort operation ASPIDES, recently arranged for two large freighters to pass through the Suez Canal. During a recent trial voyage, CMA CGM sent large vessels carrying over 17,000 TEUs, but its flagship vessels with a capacity of up to 23,000 TEUs have yet to return.

In their weekly market report, shipping analysis firm Linerlytica commented, "It is worth noting that CMA CGM has not rerouted any laden westbound (via Suez) containers, opting only to selectively redeploy eastbound voyages with the aim of repatriating ships and empty containers back to Asia after severe delays in European ports recently."

According to the meeting summary released by the Authority, CMA CGM plans to increase its group's routes through the Suez Canal. Other shipping companies such as Hapag-Lloyd are also closely monitoring developments. Mediterranean Shipping Company (MSC) expects that "southbound vessels will return rapidly in the near future"; Evergreen Marine Corporation stated their readiness to resume transit once the situation stabilizes; and COSCO Shipping also anticipates that many shipping companies will choose this route as the situation stabilizes.

However, a representative from Inchcape Shipping Agency mentioned a key obstacle, namely insurance issues. Abdel Aziz Nabil, a representative of the company, pointed out during the meeting that the high cost of marine insurance required for passage through the region remains a major barrier and is believed to be a primary reason why many companies are delaying the resumption of Suez Canal operations.

Linerlytica's analysis indicates that any move by container shipping companies to return to the much shorter Suez route will release an additional 130 vessels (equivalent to 5.9% of global capacity) for redeployment, "which will trigger significant turbulence in freight and charter markets."