The Supply Chain Crisis Brewing at Israeli Ports

A supply chain crisis is developing in Israel, with 80 vessels stuck in waiting. The ports of Haifa and Ashdod are the worst struck by this congestion of ships. This adversely impacts the Israeli economy, which is extensively dependent on seaborne trade.

Several components contribute to the current backlog of vessels at the ports. The port procedures themselves are partly to blame, states Yoram Sebba, the Israel Chamber of Commerce president. General cargo ships are given their position in the queue based on the type of cargo on board. If the load is deemed a low priority and other vessels are already ahead in line there, even on good days, it can take up to a month for the vessel's turn to arrive. Accruing demurrage charges all the while for the charterer.

The Russia Ukraine conflict is also a component as the Israeli supply of wheat comes mainly from the two countries, 50 percent of it from Russia and 30 percent from Ukraine. With the ongoing conflict, these countries are largely unable to supply, raising concerns regarding Israel's food security and hence an increased number of incoming vessels to accommodate the contingency of a shortage.

And lastly, with the arrival of Passover, Ramadan, and Easter, the country's food demands are expected to spike, contributing to the problem. Israel is taking steps to resolve the issue and recently announced a change in policy regarding the queuing policy. The vessels carrying livestock, grain, and animal feed will be prioritized to combat the food shortage threat.

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