Morning from Europe.

The collapse of the key bridge in Baltimore was in many ways talk of the macro town yesterday, but is it a biggie for global trade and shipping?

It is undoubtedly an important port for the auto-industry. It is the busiest U.S. port for car shipments, handling more than 750,000 vehicles in 2023, according to data from the Maryland Port Administration and when we look at the impact in Containers and Tankers, we are talking about non-neglectable amounts as well.

The port handles around 5% of the East Coast container volume and up to 10% of US tanker flows (see charts), begging the question whether this could increase already elevated freight rates and lead to further delays at a time of jammed shipping markets due to the lack of shipping lane capacity in the Suez- and Panama canals.

This is, again, another potential inflationary supply-side event for the US economy, but one that policy makers can shrug off as “transitory” as per the 2021/2022 playbook.

Chart 1a: Container volumes as % of East Coast total