Financial Services Association, March 27 (Editor Liu Rui) Early Tuesday morning EST, a container freighter “Daly” crashed into the “Francis Scott Key” bridge in Baltimore, USA, causing the 2.5-kilometer long bridge to collapse within seconds.

Following the incident, both Baltimore and Maryland declared a state of emergency. As of Tuesday afternoon EST, at least six people were missing in the accident, and search and rescue work is still ongoing.

The effects of this disaster will spread further, and may affect the US supply chain in the next few weeks, causing up to 2.5 million tons of coal, large quantities of automobiles, timber, and gypsum to face the threat of disruptions in transportation.

At a time when the Panama Canal is droughted and Red Sea shipping is at risk of missile attacks, the closure of the Baltimore port will further worsen the already fragile global supply chain.

The automotive and coal supply chains will be impacted

The Port of Baltimore is one of the busiest ports on the east coast of the United States. After the bridge collapsed, the only waterway in and out of the port of Baltimore was cut off, forcing the port to close for weeks, while terminals in New Jersey and Virginia faced the threat of traffic jams.

According to S&P Global Market Intelligence, in the year ending January 31, although the port of Baltimore only handled about 3% of total imports from the east coast of the United States and the Gulf Coast, since European car manufacturers such as Mercedes-Benz Group, Volkswagen, and BMW all have factories in the port and surrounding area, the closure of the port will have a huge impact on automobile transportation.

Ford Chief Financial Officer John Lawler (John Lawler) said, “This is a big port, and there is a lot of traffic, so it will have a big impact... We'll look at workarounds. We will have to move some of our goods to other ports on the east coast or elsewhere in the country.”

Furthermore, the port is also the second-largest port for US coal exports, and if closed, US coal exports to India may be affected. The US exported about 74 million tons of coal last year. Ernie Thrasher, CEO of the US coal company Xcoal Energy & Resources, said that the collapse of the bridge could disrupt coal exports from the Port of Baltimore for up to 6 weeks and block the transportation of up to 2.5 million tons of coal.

Allegedly, about 12 large ships and a similar number of tugboats are currently trapped in the port of Baltimore. The trapped ships include cargo ships, car carriers, and an oil tanker called the “Palanca Rio.”

This is still just an effect on the port. Previously, about 35,000 people passed through the Baltimore Bridge every day. According to the American Trucking Association, the value of goods passing through this bridge each year is approximately $28 billion.

Yonah Freemark (Yonah Freemark), a researcher at the American Urban Institute (Urban Institute), said, “We rely on our infrastructure system to meet our daily needs and meet our needs to import large quantities of goods from overseas to the US, and it was suddenly cut off.”

It will take weeks to clear the waterway

The Francis Scott Key Bridge is named after the lyricist of the American national anthem “The Star-Spangled Banner Never Fell”. It took 5 years to build and was completed in 1977. It is estimated that the cost was around $141 million at the time.

Freemark of the American Urban Research Institute said that if the bridge were to be rebuilt, it would probably cost “billions of dollars.” Meanwhile, US President Joe Biden has stated that he wants the federal government to pay this fee and has vowed to “do everything possible to reopen the port and rebuild the bridge.”

But currently, aside from rebuilding the bridge, for the Baltimore government, even just cleaning up the bridge debris and the nearly 300-meter-long “Daly” ship wreck from the river may take several weeks.

Scene footage of the accident

This means that in the future, the port of Baltimore will be closed for at least a few weeks and will accelerate the movement of goods to the west coast, which may cause congestion at nearby ports.

Ryan Petersen (Ryan Petersen), founder of the US digital freight platform Flexport Inc., said that if port throughput suddenly increased by 10% to 20%, it would be enough to cause a large backlog and congestion.

Baltimore will be hit hard

In addition to the supply chain shock, the biggest target of this incident is probably the city of Baltimore itself.

With a population of nearly 600,000, Baltimore is the largest city in Maryland. In recent years, due to the decline of the local steel industry, economic development has been at a standstill. The community is highly impoverished, and the crime rate remains high. The famous crime drama “Line of Fire” is set in this city.

The bridge helped connect major areas of Baltimore and was key to the city's revival as a logistics and e-commerce center.

The city has a deep-water port, short-distance railways, and well-located interstate highways, and has previously attracted a large number of investors who have invested in reconstruction. Giants such as Amazon and FedEx have leased millions of square meters of warehouse space here.

However, the collapse of the bridge will bring some uncertainty to the city's development.

US Secretary of Transportation Pete Buttigig said, “The road back to normal will not be easy, not fast, and the cost will not be very low, but we will rebuild it together.”