Suez Canal revenues have experienced a significant decline this year, with May 2024 recording about $337.8 million, a steep drop from $648 million in May 2023, marking a 64.3% decrease, according to Al-Mal news.
As Al-Mal news explains, the revenue drop is largely attributed to disruptions in the Red Sea, where Houthis have been targeting commercial vessels since November 2023. These attacks have led some ships to avoid the Suez Canal in favor of the longer Cape of Good Hope route. As a result, the number of ships crossing the canal in May 2024 fell to 1,111, compared to 2,396 in May 2023, a reduction of 1,285 ships, Al-Mal news reports.
In response, the Suez Canal Authority has extended incentives and discounts for various types of vessels, including container ships, dry bulk carriers, and oil tankers. These incentives, which offer reductions ranging from 10% to 75%, aim to attract ships back to the canal and will remain in effect until the end of December 2024.
According to Al-Mal news, the decline in ship traffic has also led to a significant drop in total tonnage, which fell by 68.5% in May 2024. The canal handled 44.9 million tons of cargo in May 2024, down from 142.9 million tons in May 2023, a difference of 98 million tons. Despite these challenges, the canal’s annual revenue reached $10 billion by the end of the previous year.
