Hearing

• Mr. Bud Darr, Executive Vice President of Maritime Policy and Government Affairs, Mediterranean Shipping Company (MSC) | Witness Testimony
• Dr. Ian Ralby, Chief Executive Officer, I.R. Consilium | Witness Testimony
• Mr. Jonathan Gold, Vice President of Supply Chain and Customs Policy, National Retail Federation | Witness Testimony
• Mr. David Heindel, President, Seafarers International Union | Witness Testimony

We meet today to examine threats and emerging challenges to maritime commerce in and around the Red Sea shipping corridor. I’d like to welcome our witnesses joining us today—Bud Darr, Executive Vice President, Maritime Policy and Government Affairs at MSC Group; Ian Ralby, CEO of I.R. Consilium; Jonathan Gold, Vice President of Supply Chain and Customs Policy, National Retail Federation; and David Heindel, President of the Seafarers International Union.

The Red Sea is a critical shipping corridor for global maritime commerce — connecting Europe and Asia through the Suez Canal, representing nearly twenty percent of container traffic and a significant portion of oil and liquified natural gas shipments.

Since October, the Houthis, an Iranian-backed separatist group based in Yemen, have sought to disrupt global commerce by significantly increasing attacks against military and civilian vessels transiting the Red Sea.  To date, dozens of vessels have been targeted, either through hijacking, attempted hijacking, or missile and drone strikes — putting ships and their crews at risk.

Sadly, we learned last week that two Navy SEALS were lost at sea during a mission to disrupt Iranian arms shipments to the Houthis. Our prayers go to the families of those fallen SEALS and to all the service members still in the region.

In response to these threats, we have seen carriers reroute ships around Africa and insurance costs skyrocket, leading to increased container rates and longer transit times for goods to arrive at their destinations. 

On December 18th, the United States announced the establishment of Operation Prosperity Guardian, a multinational security initiative to support maritime commerce transiting through the Red Sea, and on January 12^th, the United States Navy, in conjunction with coalition partners, began air strikes in an effort to degrade the Houthi’s ability to strike maritime targets.

At the same time these disruptions are occurring in the Red Sea, the Panama Canal is also facing bottlenecks as low water levels are forcing canal authorities to reduce transits by half — compounding uncertainty for ocean carriers and shippers.

We saw firsthand during the pandemic what a significant supply chain crisis can do to the global economy, and we must not let it happen again. And so, I thank our witnesses for joining us today and look forward to hearing what can be done to address these challenges.