Top Container Lines Cancel Shipping to Russia, Essentials Allowed With Increase in Scrutiny

Container ship Maersk Emerald is unloaded at the Port of Oakland, Calif., on July 12, 2018. Ben Margot, File/AP Photo

Two of the biggest container lines in the world, the Mediterranean Shipping Company (MSC) and Maersk, have announced the temporary suspension of shipping activities to and from Russia after the country was subject to international sanctions and other isolating measures.

The MSC suspension came into effect on March 1 and will cover all access areas including Far East Russia, the Black Sea, and the Baltics. “MSC will continue to accept and screen bookings for delivery of essential goods such as food, medical equipment, and humanitarian goods,” the firm said in a March 1 service update.

“MSC will contact customers directly, as necessary, in respect of any Russia-related cargo that is already in transit.” Headquartered in Switzerland, MSC is currently the biggest shipping company by capacity in the world.

Denmark’s Maersk, which was the world’s largest container shipping line and vessel operator until last year, said that it is “deeply concerned” about the escalation of the crisis in Ukraine and is making “regular adjustments” to comply with sanctions against Russia.

“As the stability and safety of our operations is already being directly and indirectly impacted by sanctions, new Maersk bookings within ocean, air, and intercontinental rail to and from Russia will be temporarily suspended, with the exception of foodstuffs, medical, and humanitarian supplies (bar dual-use items),” Maersk said in a March 1 advisory.

The suspension will cover “all Russian gateway ports.” For cargo that is already underway and for bookings that were already in place prior to the suspension, Maersk promised to do its “utmost” to ensure that the goods are delivered to their intended destination.

The company also warned of “significant delays” as countries like Germany, Belgium, and the Netherlands are holding back vessels destined to Russia to check for primarily dual-use items and restricted commodities. Maersk had halted all port calls to Ukraine last week.

The company owns a 31 percent stake in Global Ports, a Russian port operator. It employs around 500 people in Russia and 60 in Ukraine.

Maersk and MSC were preceded by Singapore-headquartered shipping firm Ocean Network Express, which announced booking cancellations to and from ports in Ukraine and Russia. Germany’s Hapag Lloyd has also stopped bookings for Russia on a temporary basis.

Despite Russia’s invasion of Ukraine, container booking rates have remained unchanged, a logistics provider in Indonesia said to S&P Global. Some liners have extended rates to North America from Indonesia until the end of this month.

“We are uncertain of what will happen [even] next week — there could be severe implications on the supply chains. … Many liners could make blank sailing into Europe due to this issue, further clogging up the system,” the logistics provider stated.

The International Maritime Organization (IMO) raised concerns about the plight of seafarers amidst the Russia-Ukraine war, with Secretary-General Kitack Lim expressing worries about the conflict’s impact on energy supplies and the delivery of food and other commodities to developing nations.