Red Sea chaos directly impacting key commodities

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Houthi rebel attacks in the Red Sea have disrupted shipping in the Suez Canal, prompting shipping companies to use the longer route around southern Africa. This has led to a 50% reduction in Suez Canal tanker traffic and an expected 8% increase in ocean freight rates. The energy sector is heavily impacted, with oil prices rising and major companies rerouting shipments. LNG trade is also affected, with significant redirections from Qatar. Agriculture, including wheat and coffee shipments, is experiencing diversions and price increases. Minor metals exports from Asia face delays and price hikes. India’s sunflower oil imports are expected to decline due to the surge in freight rates. The dry bulk sector, including companies like BHP Group, is also adjusting routes, though most of their shipments do not pass through the affected area.

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