Normal operations will not be possible at the Port of Baltimore for months following the bridge collapse. This primarily has consequences for the east coast of the USA, but also for car manufacturers from all over the world.
According to US Transportation Secretary Pete Buttigieg, the collapse of the car bridge in Baltimore also has economic consequences. Because of the importance of the port behind it, we are already preparing for supply chain problems, “which we know will come,” said Buttigieg at a press conference on site on Tuesday afternoon (local time). These would then not only affect the region around Baltimore, “but the entire US economy.”
After the incident, the responsible port authority suspended shipping traffic until further notice. According to Buttigieg, the main part of the port lies behind the collapsed bridge. The recovery of the bridge parts alone will take months, engineer and structural engineer Matthew Roblez told CNN on Wednesday night (local time). He estimated it would take around two years to rebuild.
However, in order to resume port operations, a shipping channel freed from bridge debris would be sufficient for container ships. Nevertheless, the port of Baltimore will probably not be fully used for months – especially since the bridge, which was used by 30,000 vehicles every day and has now been destroyed, was important for the delivery and removal of goods.
Port of Baltimore important for the USA
According to US President Joe Biden, the Port of Baltimore is one of the most important maritime ports of call in the USA – especially for the import and export of cars and small trucks. According to this, around 850,000 vehicles are shipped through the port of Baltimore every year. Around 15,000 jobs depend on it. However, the consequences for the more than 2,000 employees at the Port of Baltimore who load and unload cargo ships could be significant if the closure lasts longer than a few days, said logistics expert Scott Cowan. The dock workers are day laborers.
Baltimore
Motorway bridge collapses after ship collision – pictures show extent of destruction
It’s not just General Motors, Nissan, Toyota, Volvo and Tesla that use the port of Baltimore to transship their cars. German car manufacturers also unload in this port. Volkswagen says it expects delays in deliveries, but no major impact. BMW also said in an email to the Reuters news agency that the terminal used was in front of the bridge and was therefore still accessible. The terminal used by Mercedes, on the other hand, is behind the bridge. A company spokeswoman said that the Stuttgart-based company is now examining with its logistics partners whether to adjust its delivery routes to the USA. However, she didn’t want to go into detail.
USA exports coal via Baltimore
In the first nine months of 2023, Baltimore was second only to Norfolk, Virginia. Baltimore exported about 20.3 million tons of coal, up from 14.3 million tons in the same period in 2022. The U.S. also exports smaller amounts of metals and minerals through this port.
states the Port of Baltimore: “In 2022, the port exported 1,000 tons of aircraft and aircraft parts valued at $890 million. Also in 2022, the port imported a record 793,695 tons of paper and hit over 41,000 tons of books valued at $124, $5 million. That same year, the port handled 24,900 tons of chocolate valued at over $114 million, as well as ice cream valued at $59.4 million.”
Disruption of supply chains worldwide
“While Baltimore is not one of the largest ports on the U.S. East Coast, it imports and exports more than a million containers each year, so there could be significant disruptions to supply chains,” said Emily Stausbøll, market analyst at Norwegian shipping analytics firm, .
“Trade with Germany is likely to be affected by diversions,” Commerzbank trading expert Vincent Stamer told the Reuters news agency on Wednesday, given the expected disruptions in trade in the Washington metropolitan region. “The Port of Baltimore specializes in unloading cars.” The relevant ships would probably have to be rerouted to New York and Florida, which could lead to delays.
Billions in damages for insurance companies
In addition, there is the foreseeable billion-dollar loss from the collapse of the bridge: according to experts, this will be shared by many large insurers. Around 80 insurers and reinsurers are under fire with a total of three billion dollars in the Britannia P&I Club and International Group of P&I Clubs insurance pools, wrote analyst Brandan Holmes from Moody’s Ratings on Wednesday. The Pools would have insured the ship that rammed the bridge while leaving the harbor and caused it to collapse. “While the claim will be high, it will not be significant for individual insurers and reinsurers because it is spread across so many.”
Loretta Worters of the Insurance Information Institute estimates that the reconstruction of the Francis Scott Bridge alone will cost $1.2 billion, according to a report by the rating agency S&P Global. The owner of the ship – the 300 meter long, nine-year-old “Dali” – will probably be held liable for this.
Sources: DPA, Reuters, , , on goods handling, via Baltimore, .
Source: Stern
