Ever Given seized by Egypt because owners now owe $1 billion for accident.
(www.washingtonpost.com)
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All of the cargo containers on the ship are subject to being seized.
Egyptian authorities are seeking more than $1 billion in damages to cover 6-days of blocking the canal and the loss of revenue, equipment used to free the ship, the 800 people that worked to free the ship.
The owner of the Evergiven, Shoei-Kisen, declared a "general average". It means that shippers will be required "to share the relevant expenses incurred in ship rescue". "General average" is equitable sharing between a shipowner and cargo interest of certain losses, and that includes expenses that occurred during the voyage". The number of cargo owners means the process of dividing costs will be pretty lengthy and complicated.
General average is an old concept dating back hundreds of years that has evolved over time with the shipping industry. Cargo would occasionally need to be thrown overboard in emergency situations to lighten loads and save the ship. General average arose to help spread this loss.
The Evergiven can hold up to 20,000 containers... and it looked pretty full. If they divide the cost evenly between the ship owners and the cargo... each cargo container owner would be required to pay $25,000 per container as it's part in this disaster.
I seem to recall a figure of 18000 containers being mentioned
Yeah, insurance companies get involved when GA is declared. Former shipping company employee.
That's interesting info, I had no idea.
Good dig! ThanQ!
There are ulterior reasons for this seizure, of course, but Egypt's proffered excuse is almost deliberately and insultingly specious. I.e., it doesn't cost anywhere within two orders of magnitude of a billion dollars to move some sand no matter what cooked numbers the country provides. And 98% of the ships waiting for a week are still going through the canal anyway, so passage-fee revenue will quickly catch up to equilibrium.
(If the Egyptian govt's seizure is not part of a planned white-hat operation, then such a preposterous seizure amounts to flagrant piracy, and would result in steeply-jacked insurance premiums for any vessel and cargo utilizing the Suez.)