Red Sea container return nears two-thirds of Asia-Europe capacity

Container shipping is moving back to the Red Sea in growing numbers. Bank of America's shipping data tracker, reported on 29 October, puts container transits through the Red Sea at 65% of normal levels in the past two weeks, up from 50% in September¹. The bank said more service returns are being planned¹.

Freightos, in its 29 October weekly update, cited Alphaliner's estimate that nearly two-thirds of total Asia-Europe capacity is now restored⁵. Israeli carrier ZIM has resumed taking the Red Sea route on its joint Asia to US east coast service with MSC⁵. The Houthis had declared the strait closed to Israel-linked vessels in August⁵.

Two measures, one direction

Alphaliner's two-thirds is a share of deployed Asia-Europe capacity. Its survey of the 10 largest carrier networks, reported on 21 October, found 24 of 46 direct Far East to Europe services on the Red Sea, or 63% of deployed capacity. That was 70% on Far East to Mediterranean routes and 58% on Far East to North Europe^2, 6. Bank of America's 65% measures container traffic through the Red Sea against normal levels¹.

Physical traffic is rising too. Container tonnage through the Suez Canal was 54.2% higher in January to August 2026 than a year earlier, according to Suez Canal Authority data³. Drewry counted 55 containership transits in the week to 18 October, up 120% on the same week of 2025. The three-week average was 57, up 36% on the previous three weeks⁷.

The return is still uneven. Some services use Suez on the way to Europe and sail back around the Cape^2, 6.

What shorter voyages change for India-Europe buyers

For Indian shippers, the change shows up first in days. Chennai to Rotterdam now takes 23 to 24 days, against 34 to 36 days around the Cape of Good Hope, according to Tiruppur exporter Ramu Shanmugam³. Tuticorin to Antwerp and Rotterdam is quoted at $2,350 to $2,450 per 40-foot container, against $6,100 to $7,000 at the July peak³.

Those rates have already corrected. Carrier booking rates from India to Europe have halved from August highs, according to the Journal of Commerce. Unchanged or only slightly lower westbound allocations have kept spot asks from falling further⁸.

The saving is larger for the ship than for the box. Drewry calculates that a Suez round voyage covers 21,878 nautical miles and takes 97 days. The Cape route covers 29,711 nautical miles and takes 124 days, a saving of 7,833 miles and 27 days³. Drewry puts the saving at about $1 million per round voyage for a 24,000 TEU ship, roughly $43 per slot, before additional war-risk insurance costs³.

In practice, the shorter transit should let exporters from Nhava Sheva or Mundra work to later cut-offs for a given delivery date. Importers of European machinery, chemicals and spares could hold thinner safety stock³. The schedule only helps if the vessel arrives on time.

Why normalisation can push rates down

Every service that moves back to Suez frees ships, because shorter voyages let the same fleet carry more³. At the same time, the orderbook stands at 16.2 million TEU, or 46.5% of the active fleet, a post-2009 peak⁴. Freightos said the Red Sea return, if geopolitics allow it to be completed, increases overcapacity risk for carriers in 2027⁹. Shorter routes and new tonnage therefore add effective supply at once. That points to softer rates than demand alone would suggest.

For now rates are firm on the main Asia-Europe lanes. Xeneta put Far East to North Europe spot at $3,698 per FEU on 23 October, up 6.8% on the week, and the Mediterranean at $4,442, up 5.8%, even as capacity returned¹⁰. Volumes from the Far East to Europe rose 12.2% in the first seven months of the year¹⁰. "This is a conundrum because the release of capacity into the global fleet should ease pressure on rates, but we are seeing the opposite," said Peter Sand, Xeneta's chief analyst¹⁰.

Carriers are trying to manage the release. Drewry counted eight blank sailings on Asia-Europe for the following week, against two in the current week¹¹. Lines are also pushing November rate increases⁵. Forwarders report discounted offers and doubt the increases will hold^5, 6. Freightos said the increases are aimed at supporting 2027 long-term contract negotiations, which are under way⁹.

Bank of America says long-haul container rates appear to have peaked¹. Xeneta's data show Far East to North Europe spot rates down 33.2% since 1 July¹⁰.

Insurance, congestion and a different chokepoint

Suez is shorter, but not risk-free. The Lloyd's Market Association's Joint War Committee sets listed areas for London marine insurers. It expanded its high-risk zones in the Red Sea, Persian Gulf, Arabian Sea and Black Sea this year¹². Ships entering a listed area must notify their underwriter or they have no cover, said Neil Roberts, who chairs the committee¹². Extra war-risk premium is a separate cost from the Suez saving Drewry calculated³.

Keep this route separate from the Strait of Hormuz. Attacks around Hormuz have risen, and the headline additional war-risk premium for tankers transiting the strait has increased more than 40-fold since the Iran war began^12, 9. The Red Sea recovery says nothing about that exposure.

Congestion is the other offset. Saudi Red Sea ports are at capacity, with ships waiting days or sometimes weeks, and the value of goods entering Jeddah almost doubled year on year in August to SAR33.5 billion¹³. "The ports are heavily under pressure," said Tobias Maier of DHL Global Forwarding¹³. Bank of America warned that congestion could rise in coming weeks from Typhoon Champi disruption and vessel bunching¹.

Reliability reflects the strain. Global schedule reliability was 50.6% in September, up 0.9 percentage points on August but still below the 64.5% peak in May, Sea-Intelligence data show¹⁴. Late vessels averaged 6.65 days behind schedule¹⁴.

Support services are returning. Red Sea Bunkering resumed VLSFO supply at Djibouti's ports this week¹⁵. Hambantota port expects a sustained return, citing a Linerlytica forecast of full restoration through Suez by the first quarter of 2027¹⁶.

What to watch

Maersk expects all its services to return to Suez by March 2027, according to the Suez Canal Authority, which gave no dates for individual route changes¹⁷.

For buyers, three tests matter. Does your carrier's Suez schedule hold for a full round voyage, not just the westbound leg²? Are surcharge and war-risk lines written to fall when the route changes³? And does reliability improve from 50.6% before you cut safety stock¹⁴?