Why talk about canals?
Well since one of them has been blocked and has been costing the world a bit of money might be worth a chat.
First up is the canal that doesn't have the most impact but has a long history. The canal's aim is to avoid a 430 mi journey around the Peloponnese
The canal was originally thought of in ancient Greece. Dude Periander dreamed it up but decided against it because he feared the wrath from the gods (probably a good call). Emperor Nero made the other okay attempt at the canal but the small thing of his assassination stopped him.
It was finally built in 1893 (wtf took so long Greece?) by a "Greek entrepreneur"
Being narrow and only has one-way traffic, leads to usage mostly for tourism.
Amazing 1000 year investment.
Next up is one of the big boys of canal economics. It can be argued Panama canal has some importance to global economics.
In 2020 alone the total number of ocean traffic was 13,268 ships. What's interesting, if you look at the traffic from 2019 - 2020 most sectors of cargo decreased, and the transport of energy made up for the loss.
The spike in lumber transport year over year is another interesting data point. The transport of lumber should be a loose representation of the demand for lumber.
And that demand increase should represent an increase in the price of lumber.
Good thing lumber hasn't gone up by almost 200% over the last year. Inflation isn't a realllllly a thing.
AKA the constipated canal.
Right now the Ever Given is stuck blocking traffic to move through the canal. Costing only about $400 million per hour. As of today it's only cost roughly $37 billion.
What's costing so much?
Containerized goods represent around 26% of total Suez traffic and in value terms, delays will be significant. Rough calculations suggest westbound traffic is worth around $5.1bn daily while eastbound traffic is worth $4.5bn.
So the cost is from ships just sitting there. Cool.
- https://www.marineinsight.com/know-more/the-corinthian-canal-a-narrow-man-made-shipping-canal/#:~:text=Spanning a distance of 6.3,journey of 185 nautical miles.