Arctic shipping faces limits despite Suez disruption

Arctic shipping routes are drawing interest as disruption around the Suez Canal lengthens Asia-Europe voyages, but industry experts say the Northern Sea Route is unlikely to transform global trade soon.

Container ships from China and South Korea are expected to use the route through Russian territorial waters in the coming weeks, testing whether longer ice-free periods can make the Arctic passage commercially useful.

The Northern Sea Route can cut the distance between Europe and Asia by 30 to 40 percent compared with using the Suez Canal, and by nearly half compared with sailing around southern Africa, credit insurer Coface said in April.

But experts said the route has major limits. Paul Tourret, director of the Higher Institute of Maritime Economics in Saint-Nazaire, France, said the Arctic link can only be seasonal, from August to October, and requires more expensive ice-class ships.

Jerome de Ricqles, a sea freight specialist at Upply, said the Chinese container ship Dubai Tower, which set out from Ningbo for Europe this month, has only about one-tenth the capacity of the biggest container ships used on established routes.

Most container ships on the Northern Sea Route also need escorts from Russia's nuclear-powered icebreaker fleet. A recent Allianz Commercial study said a record 23 vessels made the passage last year, compared with 15 in 2024. Even amid Middle East conflicts, about 35 ships a day used the Suez Canal in the first half of this year, down from more than 50 a day before Houthi attacks began in 2023.

Coface estimated that just 3.5 percent of current traffic between East Asia, northern Europe and North America could shift to Arctic routes. It said viability to 2030 remains extremely limited and mainly concerns raw materials.

The route may be more attractive for bulk liquid vessels carrying oil and liquefied natural gas, with Coface finding possible cost cuts of 45 to 50 percent in some cases.

Environmental concerns remain. Increased traffic could add soot emissions that settle on the ice cap and trap heat from sunlight, while fuel spills are also a risk. CMA-CGM, MSC and Hapag-Lloyd have pledged not to use the Northern Sea Route.

Coface economist Eve Barre said interest in Arctic shipping is “less commercial than political” amid rivalries involving Russia, China and the United States.