The problems in the Strait of Hormuz is causing problems worldwide in many industry sectors.

The current backlog at the Panama Canal is 6 + days northbound (Pacific to Atlantic) and up to 13 days southbound (Atlantic to Pacific). In early 2025 (post -drought) it was roughly 0 to 3 days each way. Part of this is due to tankers searching for oil.

The Suez Canal is an entirely different story. It is running at about 60% of long-term traffic rates because of the pirates at the Red Sea end. The last time there was a queue at the Suez Canal was in 2021 and it was a total of 422 ships at its peak.

What are the other choices to get around the world? A ship can go south and skirt the southernmost end of Africa or South America. The other choice is over the top--Arctic Ocean.

Despite possible global warming effects, the northern routes, at their best for shipping, are open July - October. This means icebreakers for the rest of the year. Russia has the most--somewhere between 30 and 57 with some nuclear powered (the only nuclear-powered ice breakers in the world). Canada has 18. The United State has 3 heavy polar icebreakers. Finland has 7-10 but they are mostly focused on the Baltic Sea. All other fleets are smaller. China is building out a fleet because the shortest path to Europe for them is over the top.

What does this mean for the pulp and paper industry? If you are buying or selling market pulp or other products, not only are you experiencing higher fuel costs for shipping, but you may also be experiencing longer routes (even more transit costs) or lengthy delays. Any way you look at it is more costs and more transit time.

Jim Thompson is CEO of Paperitalo Publications.