JP Morgan warns: Suez Canal "bottleneck" difficult to clear, US trade policy exacerbates geopolitical risks.

JPMorgan Chase has released its latest global trade chokepoints monitoring report, with a focus on the Suez Canal (and the Strait of Hormuz) as container ship capacity in the region remains 90% lower than normal, while operations in all other major sailing areas are normal. JPMorgan Chase also stated that given the widespread impact of US trade policies on the global transportation network, geopolitical risks have intensified. JPMorgan Chase emphasized that global trade capacity restrictions are mainly concentrated in the Suez Canal. Currently, due to Houthi attacks on commercial shipping, container ship capacity in the region remains 90% lower than normal (overall vessel capacity is 60% lower than normal), affecting about 7% of global container ship capacity. In comparison, the Panama Canal operates normally, and the Northern Sea Route is designated by the US as a key chokepoint, but due to inadequate infrastructure, the actual usage of this route is limited. Regionally, in the Europe/Middle East region, the Suez Canal remains an important global trade chokepoint. With US President Trump recently announcing a ceasefire with the Houthis, discussions on the eventual return of capacity to the Red Sea are increasing, but JPMorgan Chase has not seen any major container shipping operators planning to return to the region yet. JPMorgan Chase did not list Russian airspace as a current limiting factor in the report, as Russian air traffic is gradually recovering. Despite Western airlines generally avoiding the region since the start of the Ukraine-Russia war, research from the European Organisation for the Safety of Air Navigation shows that cargo flights continue to fly over the area without any substantial impact on capacity, and passenger traffic has been recovering since mid-2024. In the Americas, the strategically important chokepoint is the Panama Canal, accounting for 5% of global container shipping volume but 40% of US container shipping volume. After throughput was limited due to low water levels, navigation in the canal has now resumed. Against the backdrop of the US-China trade conflict, the canal has become a focus of market attention. Additionally, operations at US ports remain relatively smooth as labor union contracts have been secured for the coming years. In the Asia-Pacific region, the situation is generally stable, with limiting factors mainly in port congestion due to adverse weather. Operations at Asian ports may also be affected by changes in US trade policy. JPMorgan Chase emphasized that the Malacca Strait and the Taiwan Strait are two strategically important chokepoints for trade flow, both of which currently show normal operations but are vulnerable to geopolitical factors.