Thread by @typesfast

A massive container ship crashed into the main bridge of Baltimore’s beltway this morning, causing total collapse to the bridge and cutting off the city’s container port from the global ocean. At least 6 people are missing. 🧵

The collision of the Dali, built in 2016 by Hyundai and operated by Maersk, took place around 3 am last night. If it had occurred during rush hour this likely would have caused much more loss of life.

https://twitter.com/BNONews/status/1772515766929097088

The total collapse of the bridge means that Baltimore's container port is now cut off from the global ocean until salvage crews can clear the channel. The container port is that grey area just to the north of the collapsed bridge.

Flexport is the 9th largest importer of goods into the port of Baltimore. We only have 2 containers on the ship—both exports for non profit customers of//Flexport.org but we have 330 containers currently en route to the port that will have to be re-routed. One of the containers on board contains donated playground equipment being shipped to Zambia and another contains bedding, toys and other supplies for a development project in Malawi. Both non-profit customers have been notified of the delays on their cargo and we're working with insurance companies on next steps.

All ship traffic to the port of Baltimore is being now re-routed, likely to either Philadelphia, PA or Norfolk, VA. Flexport currently has 330 containers bound for Baltimore and we're working on new routings for each of those and notifying all impacted customers asap this am.

Last year Baltimore processed 1.1M TEUs making it the twelfth largest container port in the United States and the most important port serving the nation's capital. It's also the busiest U.S. port for car shipments, with more than 750,000 vehicles handled in 2023. At least some of the car ports are outside the bridge so shouldn't be affected directly though the road traffic will be a huge issue for everybody in the region. Baltimore is also the largest U.S. port by volume for handling farm and construction machinery, as well as a vast array of agricultural products.

This is not the first time DALI has struck city infrastructure while transporting goods — a similar but far less serious incident took place in Antwerp in 2016. Presumably it was a different pilot driving the ship back then.
foxbusiness.com/fox-news-us/bo…

Redirecting all this cargo to other ports is likely to lead to congestion and delays across the eastern seaboard as they will struggle to handle the sudden surge in volumes. The ILA, the union that operates east cost ports, is renegotiating their contract which ends on Sept 31st.

Hopefully the salvage companies hired to clear the channel can get it open to restore operation to the port in a matter of weeks rather than months. Salvage companies are known to work miracles under the most intense circumstances. But this is the reason the US navy insisted on building a tunnel rather than a bridge across the mouth of the Chesapeake to prevent the country's primary naval base at the port of Norfolk ever being bottled up.

Between the uncertainty from that as well as ships rerouting around the Red Sea because of Houthi attacks and the Panama canal only operating at 2/3 capacity due to low water levels, companies have been re-routing their cargo through west coast ports, opting to truck or rail it across the country to avoid the delays.

This will surely cause even more cargo to shift to the west coast, likely leading to congestion and delays. As we saw in Covid, even a 10 or 20% increase in volumes can lead to a compound feedback loop of congestion and delays. Most ocean freight contracts are signed between March and May each year, so many companies have the flexibility right now to sign contracts to ship their containers to the west coast to avoid likely congestion and delays on the east coast.

The impact of this seems likely to run into the billions, not only for replacing the bridge and compensating the victims' families, but also for damages incurred by disruptions to cargo flow and the huge amount of highway traffic disruptions in the Baltimore region for months or even years to come.

Who pays for those damages? The damage to the vessel and the cargo will be paid by the owners of the cargo (NOT by the ship owner or operator). The cargo owners split this pro rata based on how many containers they have on board following a long established principle of maritime law called General Average.

General Average is an ancient principle (older than the US constitution) designed to encourage sailors working to save a ship to not be concerned with whose cargo gets thrown overboard, just focus on saving the ship and the cargo owners will split the losses evenly.