Grain supplies under fire: US rallies international naval defense force to combat Houthi Red Sea attacks

20 Dec 2023 --- US defense secretary Lloyd Austin has announced the launch of an international naval coalition to counter the Houthi attacks on shipping vessels in the Red Sea. The uncertainty is causing the world’s largest cargo companies to avoid transporting goods through waterways leading to the Suez Canal, by which at least 15% of global goods are transported annually.

The UK, Bahrain, Canada, France, Italy, Netherlands, Norway, Seychelles and Spain will join the US in conducting joint naval patrols and providing intelligence support in the southern Red Sea and the Gulf of Aden.

The attacks, perpetrated by Houthi militants in Yemen, are raising costs on energy and F&B supplies globally. The Suez Canal Authority estimates roughly 55 million tons of grain pass through each year. 

Transport times and insurance prices have risen over the past month and analysts fear the situation will compound damage to supply chains already suffering from the lingering impact of the COVID-19 pandemic and the ongoing war in Ukraine.

After the October 7 Hamas attacks, Houthi militants began assaulting ships transporting goods they claim are connected to Israel, in what they say are acts of solidarity with the Palestinians. The militants pledge to continue the attacks until the Israeli government ends its invasion of Gaza. 

In the last week alone, major shipping companies including Maersk, Hapag Lloyd and MSC announced they will halt using the Red Sea. According to the Atlantic Council think tank, 70% of the world’s biggest shipping companies (by market share) have now suspended all trade through the sea. Grain shipments are rising in cost due to the attacks.

Operation Prosperity Guardian
While no one has reportedly been killed by the Houthi attacks yet, analysts expect the attacks to continue, and a likely escalation if deaths occur. 

“Countries that seek to uphold the foundational principle of freedom of navigation must come together to tackle the challenge posed by this non-state actor,” Austin announced in Bahrain yesterday.

“This is an international challenge that demands collective action. Therefore, today I am announcing the establishment of Operation Prosperity Guardian, an important new multinational security initiative.”

According to The Times of Israel, a US official confirmed that other nations are joining the coalition on the condition of anonymity.

Surging shipping costs
Rerouting ships around Southern Africa to avoid the Red Sea means roughly an additional 3,500 miles trip for cargo travelling from Asia to Europe. Some transporters estimate an additional 20% in costs. 

UK Prime Minister Rishi Sunak says the situation is having “a real impact on the global economy,” and that “this is not actually about the situation in Israel and Gaza.” 

“This is about malign forces and the Houthis in particular taking advantage of the situation to try and escalate it. And that is having a real impact on the global economy and we are playing our part as part of a broader international coalition.”

By Louis Gore-Langton