Red Sea Shipping Attacks: What the Diversions Did to Island Import Costs
Attacks on merchant ships in the Red Sea from late 2023 pushed most container lines around the Cape of Good Hope. Suez Canal transits fell from 26,434 in 2023 to 13,213 in 2024 and 12,758 in 2025. The longer route raised freight rates worldwide, including on routes that never touch the Red Sea, and war-risk insurance for Red Sea transits rose from under 0.1 percent of a ship’s value to about 0.7–1 percent by early 2024. UNCTAD estimates the freight shock will raise consumer prices in small island developing States by 0.9 percent, against 0.6 percent worldwide. Mauritius saw container rates from China and India roughly triple, while Jamaica and Barbados flagged freight costs as an inflation risk. Island governments should track the route, price freight scenarios into budgets and hold stock to cover a reroute.
The short version
The Red Sea diversions made island imports dearer in three ways. Ships sailed about 10 days longer around Africa, which tied up capacity and lifted freight rates on almost every route (IMF, Mar. 7, 2024; Federal Reserve Bank of St. Louis, Feb. 15, 2024). Insurers charged more for ships that still used the Red Sea (UNCTAD, Feb. 2024). And small islands, which already pay more per ton to ship goods, passed more of the increase on to consumers: UNCTAD’s simulation puts the consumer price effect in small island developing States at 0.9 percent, half again the world average (UNCTAD Review of Maritime Transport 2024).
This explainer looks at one question: what did the Red Sea shipping crisis cost the islands at the far end of the supply chain? It is a companion to ISPI’s companion explainer on the eight chokepoints. Here the focus is on money and time: transits, freight rates, insurance, fuel, and what island central banks and port authorities in the Indian Ocean, the Caribbean and the Pacific reported.
The answer is not the same everywhere. Islands on the Cape route, such as Mauritius, paid more for goods from Asia but also gained ship calls and fuel sales. Caribbean islands far from the Red Sea still faced container shortages and higher rates. Pacific islands sit off the Suez route but buy in a global freight market that tightened for everyone. This piece is part of ISPI’s ports and maritime security research hub and its supply chain and infrastructure hub.
What happened to Red Sea shipping
Attacks on commercial ships in the southern Red Sea began in November 2023. IMF PortWatch records reduced traffic from Dec. 16, 2023, and describes the Red Sea as a lane that normally carries about 15 percent of global maritime trade volume and more than 22,000 transit calls a year (IMF PortWatch). On Dec. 18, 2023, the Joint War Committee of the London insurance market expanded its listed areas in the Indian Ocean, Gulf of Aden and southern Red Sea (UNCTAD, Feb. 2024).
Container lines moved first. By the first half of February 2024, container tonnage crossing the Suez Canal had fallen 82 percent, and by Feb. 18 some 621 container ships were rerouting around the Cape of Good Hope (UNCTAD, Feb. 2024). The IMF found that Suez Canal trade volume in January and February 2024 was 50 percent lower than a year earlier (IMF, Mar. 7, 2024).
The Suez Canal Authority’s statistics show the scale: a record 26,434 transits in 2023, then 13,213 in 2024 and 12,758 in 2025, with net tonnage down by about two-thirds (Suez Canal Authority). In early May 2025 tonnage transits were still around 70 percent below the 2023 average (UNCTAD Review of Maritime Transport 2025).
| Indicator | Before | During the disruption | Source |
|---|---|---|---|
| Suez Canal transits (vessels a year) | 26,434 in 2023 (72.4 a day) | 13,213 in 2024 (36.1 a day); 12,758 in 2025 (35.0 a day) | Suez Canal Authority |
| Suez Canal net tonnage | 1.57 billion tons in 2023 | 525 million in 2024; 522 million in 2025 | Suez Canal Authority |
| Suez Canal trade volume, Jan.–Feb. 2024 | Same months of 2023 | Down 50 percent year on year | IMF, Mar. 7, 2024 |
| Bab el-Mandeb transits (cargo ships over 1,000 dwt) | About 61 a day (2023 baseline) | 106 in the 72 hours to Oct. 31, 2026; about 35 a day on AIS tracking | JMIC Update 110, Nov. 1, 2026 |
| War-risk premium for a Red Sea transit | Under 0.1 percent of hull value | About 0.7–1 percent reported by early February 2024 | UNCTAD, Feb. 2024 |
In 2026 the risk returned. The IMO condemned renewed attacks in the Red Sea area in July (IMO, July 23, 2026) and reported seafarer deaths in August after the cargo ship TIHAMAH was hit off Al Mokha, Yemen (IMO, Aug. 12, 2026). The Joint Maritime Information Center advisory of Nov. 1, 2026 keeps the southern Red Sea and Bab el-Mandeb at a substantial threat level, reports no confirmed attack on a merchant ship since Aug. 24, and describes the Houthi blockade announced on July 20 as selective against ships linked to Israel, Saudi Arabia or Yemen’s internationally recognized government. Traffic remains below its earlier level, while the Suez Canal operates normally (JMIC Update 110, Nov. 1, 2026).
How a diversion becomes an island price
A ship that avoids the Red Sea does not simply take a longer road. The detour changes the economics of the whole fleet, and those changes reach islands through several channels at once.
Time and capacity
The IMF put the average delay from the Cape detour at 10 days or more, which hurt companies with limited inventories (IMF, Mar. 7, 2024). Because each voyage takes longer, the same cargo needs more ships: UNCTAD, citing Clarksons Research, estimated that rerouting raised container ship demand by about 12 percent (UNCTAD Review of Maritime Transport 2024). When capacity is absorbed on the long Asia–Europe loop, there is less of it for smaller trades, which is where most islands sit.
Freight rates
Spot container rates moved fast. Between early December 2023 and early February 2024, average container spot rates from Shanghai more than doubled, and the Shanghai–Northern Europe rate reached $2,648 per twenty-foot container (TEU) on Feb. 9, 2024, three and a half times its early November level (UNCTAD, Feb. 2024). The effect spread to routes that do not use Suez at all: rates from Shanghai to the U.S. West Coast rose 130 percent from early November 2023 (UNCTAD, Feb. 2024). Researchers at the Federal Reserve Bank of St. Louis found that by early February 2024, compared with late October 2023, container shipping costs on trans-Pacific routes between East Asia and North America had risen by roughly 70 percent and on Atlantic routes by around 20 percent. They explained that longer voyages act as a global cut in shipping capacity (Federal Reserve Bank of St. Louis, Feb. 15, 2024).
Rates stayed high: the Shanghai Containerized Freight Index averaged 2,496 points in 2024, about 149 percent above its 2023 average (UNCTAD Review of Maritime Transport 2025). Secondary routes rose steeply too; from January to July 2024 the average Shanghai–South America rate more than doubled to $9,026 per TEU (UNCTAD, Oct. 22, 2024). UNCTAD calculated that the Red Sea and Suez disruptions contributed 148 percentage points to the cumulative 120 percent rise in the China Containerized Freight Index between October 2023 and June 2024 (UNCTAD, Oct. 22, 2024).
Insurance
War-risk insurance is charged per transit as a share of the ship’s value. UNCTAD reported that a Red Sea transit attracted a premium above 0.3 percent of a ship’s value in the final weeks of 2023, double the mid-October level, and that by early February 2024 some reports put premiums at about 0.7 to 1 percent, up from under 0.1 percent (UNCTAD, Feb. 2024). UNCTAD also noted a rise in insurance and legal claims from delayed shipments, damaged ships and spoiled cargo.
Fuel and speed
To hold schedules on the longer route, operators sped up, and for a large container ship a 1 percent speed increase typically raises fuel use by 2.2 percent (UNCTAD, Feb. 2024). The table sets out the published cost examples.
| Cost driver | Published figure | Source |
|---|---|---|
| Voyage time, Shenzhen to Rotterdam | About 31 days via Suez; about 41 days via the Cape (10,000 vs 13,000 nautical miles) | UNCTAD Review of Maritime Transport 2024 |
| Average delivery delay | 10 days or more | IMF, Mar. 7, 2024 |
| Extra ship capacity needed | Container ship demand up about 12 percent in June 2024 compared with no rerouting | UNCTAD Review of Maritime Transport 2024 |
| Fuel | Sailing speeds up about 25 percent, from 16 to 20 knots, which tripled bunker consumption | UNCTAD Review of Maritime Transport 2024 |
| Cost per container arriving in Europe | About $160 extra per forty-foot container via Suez, or $272 extra via the Cape (ITF estimates) | UNCTAD Review of Maritime Transport 2024 |
| Spot rate, Shanghai to Northern Europe | $2,648 per TEU on Feb. 9, 2024, three and a half times the early November 2023 level | UNCTAD, Feb. 2024 |
| Spot rate, Shanghai to U.S. West Coast (route does not use Suez) | Up 130 percent from early November 2023 to February 2024 | UNCTAD, Feb. 2024 |
Equipment was the last link. Longer loops keep containers at sea for longer, and empty boxes end up in the wrong places. UNCTAD noted that off-schedule arrivals force carriers to reposition empty containers (UNCTAD Review of Maritime Transport 2024), and the Mauritius Ports Authority observed that carriers prioritized shipments to high-paying markets such as the United States and Europe, potentially at the expense of regions such as Africa (Mauritius Ports Authority, FY24/25 trade performance).
Why small islands pay more
Islands started from a worse position. UNCTAD and the World Bank’s Trade-and-Transport Dataset shows that from 2016 to 2021, small island developing States (SIDS) paid about $103 per ton in maritime transport costs for imports, 15 to 20 percent more per ton than other groups; developed economies paid about $86 (UNCTAD Review of Maritime Transport 2024). UNCTAD also reports that SIDS have seen their maritime connectivity decline by an average of 9 percent over the past decade (UNCTAD, Oct. 22, 2024). Fewer services and smaller volumes mean islands have less bargaining power when capacity tightens.
UNCTAD then modeled what the 2023–24 freight increases would do once they passed through to prices, assuming they were sustained. The result puts SIDS at the top of the impact table (UNCTAD Review of Maritime Transport 2024):
| Economic group | Consumer prices | Real GDP |
|---|---|---|
| World (median) | +0.6 percent by around end-2025 | −0.06 percent |
| Small island developing States | +0.9 percent (processed food +1.3 percent) | −0.11 percent |
| Least developed countries | +0.8 percent | −0.07 percent |
The mechanism matters for island planners. UNCTAD attributes the larger effect to heavy reliance on seaborne trade and limited ability to replace imports with local production, and it singles out processed food because SIDS import so much of it by sea (UNCTAD Review of Maritime Transport 2024). The pass-through is slow: the simulation assumes about a one-year lag between higher freight rates and consumer prices (UNCTAD Review of Maritime Transport 2024).
The Caribbean shows how island geography multiplies the effect. UNCTAD reports that shipping a forty-foot container from Miami to Roseau, Dominica cost about $5,750 in June 2024 against $985 to Shanghai, and that port handling charges in the Caribbean are two to three times higher than in similar ports elsewhere (UNCTAD Review of Maritime Transport 2024). Any rise in the global rate lands on top of that structure.
Indian Ocean islands: closest to the detour
Indian Ocean islands were the most directly exposed, because so much of their trade with Europe used the Suez route. UNCTAD estimated that about 19.7 percent of Seychelles’ trade volume passed through the Suez Canal in 2022; its chart of selected economies placed Seychelles alongside Sudan, Yemen, Djibouti and Saudi Arabia (UNCTAD, Feb. 2024). In July 2024 the Central Bank of Seychelles said that attacks on cargo ships in the Red Sea and Persian Gulf were among the main risks to commodity prices, and that higher freight costs and a weaker rupee could offset lower global food prices. It expected inflation to be higher in 2024 than in 2023 (Central Bank of Seychelles, July 2024).
Mauritius gives the clearest island-level numbers, and they cut both ways. In its 2023–24 annual report, the Mauritius Ports Authority said the crisis had cut both ways. On the cost side, the rate for a 20-foot container from China or India to Mauritius rose from about $1,700 before the Red Sea crisis to about $5,200 in June 2024, while rates between Europe and Mauritius stayed practically the same (Mauritius Ports Authority Annual Report 2023–24). The asymmetry is telling: the island’s Asian supply lines were caught up in the global capacity squeeze even though they do not cross the Red Sea.
On the other side, ships diverted around Africa needed fuel and services. Port Louis handled 3,517 vessel calls in financial year 2023/24, up 29.6 percent, and bunker sales rose 72.3 percent to 734,856 tonnes (Mauritius Ports Authority Annual Report 2023–24). The next year brought new records: 4,139 vessel calls and 1,048,471 tonnes of bunker fuel, growth the authority attributed mainly to ships calling for bunkering and crew changes (Mauritius Ports Authority, FY24/25 trade performance). UNCTAD also named Port Louis among the Cape-route ports that gained from congestion in South Africa (UNCTAD Review of Maritime Transport 2024).
The Bank of Mauritius tracked the cost side. Minutes of its July 2024 Monetary Policy Committee meeting record that the Freightos Baltic Index of container rates rose rapidly from December 2023 and that rerouting around Africa produced higher shipping costs and port congestion (Bank of Mauritius, July 2024). Headline inflation in Mauritius nevertheless fell during the first half of 2024 as food and fuel prices eased, a reminder that freight is one pressure among several and not the only driver of island prices (Bank of Mauritius, July 2024).
Caribbean islands: far from the Red Sea, still paying
The Caribbean is far from the Red Sea, yet its central banks flagged the crisis within months. In June 2024, the Bank of Jamaica listed rising international shipping costs among the upside risks to inflation (Bank of Jamaica, June 2024). Its August 2024 monetary policy report was more specific: average freight prices rose 28 percent in May, 41 percent in June and 18 percent in July 2024 to the report date, largely because of container shortages caused by the Red Sea attacks, longer transit times and shippers bringing orders forward to avoid possible tariffs (Bank of Jamaica, Aug. 2024). The same report listed rising shipping costs alongside Hurricane Beryl as risks to its inflation forecast; ISPI’s Hurricane Beryl case study covers that storm’s port and airport recovery.
The Central Bank of Barbados said in August 2024 that the Red Sea crisis, water shortages in the Panama Canal and port congestion could lead to a surge in freight costs, one of the risks to its forecast of 3 to 3.5 percent average inflation for 2024 (Central Bank of Barbados, Aug. 2, 2024). The Panama point is important for the Caribbean: in early 2024 the region faced two chokepoint problems at once, one caused by conflict and one by drought (UNCTAD, Feb. 2024).
By 2026 the pressure had shifted to energy, mainly from the Strait of Hormuz rather than the Red Sea. UNCTAD reported in July 2026 that in some Caribbean islands as much as half of food is imported through fuel-dependent logistics, and that in a WFP and CARICOM survey the share of people reporting higher electricity prices rose from 41 to 55 percent after April 2026 (UNCTAD, July 29, 2026). The channels are the same: freight and fuel. ISPI’s Jamaica region page collects related Caribbean analysis.
Pacific islands: off the route, not off the hook
Pacific island supply lines do not normally depend on the Suez Canal, so the Pacific felt the Red Sea crisis indirectly, through the global freight market. That channel was strong. The St. Louis Fed found trans-Pacific container rates between East Asia and North America up roughly 70 percent by early February 2024, and UNCTAD recorded a 130 percent rise in spot rates from Shanghai to the U.S. West Coast (Federal Reserve Bank of St. Louis, Feb. 15, 2024; UNCTAD, Feb. 2024). In the sources reviewed for this explainer, no Pacific island government published a figure that separates the Red Sea effect from other freight pressures, a gap worth closing.
Hawaiʻi is a useful comparison. As ISPI’s explainer on Honolulu Harbor and the single-port state sets out, about 85 percent of the goods used in the state are imported, almost all through its commercial harbors. Even without any Red Sea exposure on the main routes, a global tightening of container capacity raises the cost of every box that has to come in by sea.
For the Pacific, the larger 2026 shock came from Hormuz. Pacific Islands Forum Leaders invoked the Biketawa Declaration in May 2026 over the fuel crisis, as ISPI’s analysis of the Forum’s Biketawa invocation over fuel explains, and the maritime chokepoints explainer covers the Hormuz figures. The common lesson with the Red Sea is that islands absorb shocks they cannot influence, which is the condition ISPI calls supply chain singularity.
What island governments and importers can do
The Red Sea record points to practical steps that do not depend on any change in the conflict itself:
- Watch the route, not only the price. UKMTO publishes Joint Maritime Information Center advisories with threat levels and transit counts (JMIC Update 110, Nov. 1, 2026), and IMF PortWatch tracks chokepoint transits and port calls for free (IMF PortWatch). A change in threat level is an early warning that rates will follow.
- Price freight scenarios into budgets. Spot rates on affected routes doubled or tripled within weeks, and the consumer price effect arrives over about a year. Ministries that buy fuel, medicines or construction materials can test budgets against that range.
- Plan for customs revenue timing. The IMF warned that rerouting can shift recorded imports from one month to the next, so governments that rely on import duties may see a temporary revenue dip.
- Convert delay into days of stock. An average delay of 10 days or more is the minimum buffer to test for critical goods that come from Europe or the Middle East, and longer for goods that depend on a single feeder service.
- Pool volumes. UNCTAD’s Caribbean forum recommended consolidating cargo with other ports and helping small businesses ship together, to offset diseconomies of scale.
- Use the upside where it exists. Mauritius shows that an island on a diversion route can gain ship calls and fuel sales. That depends on port capacity, bunker supply and safety systems being ready before the diversion starts.
- UNCTAD, Navigating troubled waters: Impact to global trade of disruption of shipping routes in the Red Sea, Black Sea and Panama Canal (UNCTAD/OSG/INF/2024/2), February 2024 (PDF)
- UNCTAD, Review of Maritime Transport 2024: Navigating maritime chokepoints (PDF)
- UNCTAD, Review of Maritime Transport 2025: Staying the course in turbulent waters (PDF)
- UNCTAD, High freight rates strain global supply chains, threaten vulnerable economies, October 22, 2024
- UNCTAD, Why Caribbean households remain under pressure after oil prices ease, July 29, 2026
- International Monetary Fund, Red Sea Attacks Disrupt Global Trade (IMF Blog), March 7, 2024
- IMF PortWatch, Disruption Monitor: Trade Disruptions in the Red Sea
- Federal Reserve Bank of St. Louis, Shipping Disruptions in the Red Sea: Ripples across the Globe, February 15, 2024
- Suez Canal Authority, Suez Canal Statistics for 2025 Compared to 2024 (annual navigation report, PDF)
- Joint Maritime Information Center (via UKMTO), Update 110 to JMIC Advisory Note, 1 March – 1 November 2026 (PDF)
- International Maritime Organization, Statement on recent attacks on ships in the Red Sea, July 23, 2026
- International Maritime Organization, Statement on deadly ship attack in the Red Sea, August 12, 2026
- Mauritius Ports Authority, Annual Report 2023–2024 (PDF)
- Mauritius Ports Authority, Port Trade Performance FY23/24 versus FY24/25, October 14, 2025 (PDF)
- Bank of Mauritius, Minutes of the 71st Monetary Policy Committee Meeting held on 11 July 2024
- Central Bank of Seychelles, Monetary Policy Report, July 2024 (PDF)
- Bank of Jamaica, Quarterly Monetary Policy Report, August 2024 (PDF)
- Bank of Jamaica, Monetary Policy Press Release, June 2024
- Central Bank of Barbados, Outlook for Barbados’ Economy in 2024, August 2, 2024
The customs revenue point comes from the IMF’s March 2024 analysis (IMF, Mar. 7, 2024) and the pooling recommendation from UNCTAD’s 2024 review (UNCTAD Review of Maritime Transport 2024). For planning tools, see the continuity of operations guide for island local government, WP-06 on island supply chain security and the review of the Philippines’ 2026 energy emergency.
Frequently asked questions
How much did the Red Sea attacks reduce Suez Canal traffic?
According to the Suez Canal Authority, transits fell from a record 26,434 vessels in 2023 to 13,213 in 2024 and 12,758 in 2025, roughly half the 2023 level. Net tonnage fell by about two-thirds.
Why did freight rates rise on routes that avoid the Red Sea?
Sailing around the Cape of Good Hope adds about 10 days to many voyages, so the same cargo needs more ships. That absorbs capacity across the whole fleet. Rates from Shanghai to the U.S. West Coast, a route that does not use Suez, rose 130 percent from early November 2023 to February 2024.
Why are small island states hit harder?
They already pay more per ton to ship goods, depend heavily on imported food and fuel, and have few alternatives. UNCTAD’s simulation puts the consumer price effect of the 2023–24 freight increases at 0.9 percent for small island developing States against 0.6 percent worldwide.
Did any island benefit from the diversions?
Mauritius did in part. Port Louis vessel calls rose 29.6 percent in financial year 2023/24 and bunker sales rose 72.3 percent, as ships on the Cape route stopped for fuel. At the same time, container rates from China and India to Mauritius roughly tripled.
Is the Red Sea safe for shipping now?
As of the Joint Maritime Information Center advisory of Nov. 1, 2026, the threat level for the southern Red Sea and Bab el-Mandeb remained substantial, with no confirmed attack on a merchant ship since Aug. 24, 2026 and traffic below its earlier level. Operators should check the latest UKMTO and JMIC advisories before each voyage.
ISPI publishes its research free under CC BY 4.0. If your government, port authority or importer association needs a supply-route exposure review, a freight-shock budget scenario or a fuel and stock-days assessment, you can commission research from ISPI. ISPI is a nonprofit organization with its 501(c)(3) application pending. Contributions are not tax-deductible until IRS recognition is granted.
