The Business Impact of the Baltimore Bridge Collapse
On Tuesday morning, a 984-foot cargo ship carrying 4,700 containers struck Baltimore’s Francis Scott Key Bridge, causing it to collapse.
Among the 4,700 containers on the ship, 56 contained hazardous materials, but Coast Guard Vice Admiral Peter Gautier said, “the containers pose no threat to the public” since they were stored in an area of the ship that was largely unaffected by the impact.
The bridge collapse is blocking a key channel and has caused officials to suspend the flow of ships in and out of the port indefinitely. Details about why the ship lost power and crashed are still forthcoming.
The closure of the port channel will have a significant business impact on the local economy and global supply chain.
Local economy
- Jobs Impact: The collapse is estimated to directly impact 15,000 port workers (less ship traffic means less work, not necessarily layoffs) and 140,000 workers indirectly
- Traffic Impact: The estimated 31,000 people who travel Baltimore’s Francis Scott Key Bridge every day will need to find a new route, which will cause congestion in the local area
Global Supply Chain
The Port of Baltimore is the largest port in the country for foreign cargo – 51 million tons of foreign cargo flow through the port annually. We can expect delays for significant imports and exports:
- Liquified Natural Gas (LNG) Exports: Half a million tonnes of LNG leave the Port of Baltimore per month – primarily to the UK and EU
- Coal Exports: 20.3 million short tons of coal left the Port of Baltimore during the first nine months of 2023 – primarily to India, with smaller amounts to Europe and China
- Passenger Vehicle Imports: 850,000 vehicles passed through the Port of Baltimore in 2023 (~100,000 for U.S. dealers located in the Northwest and Mid-Atlantic U.S.) – primarily from Germany, Japan, and Mexico
- Sugar Imports: 6 million pounds of sugar flows into the Port of Baltimore per day – primarily from Mexico
- Farm and Construction Machinery Imports: 1.3 million tons of roll-on/roll-off farm and construction machinery passed into the Part of Baltimore in 2023 – primarily from China
Looking forward: There is no specific timeline for when ships can move in and out of the channel into the Port of Baltimore. Some containers intended for the port must be redirected to the neighboring ports of New York, New Jersey, and Virginia, which could increase shipping costs, shipping times, and consumer prices.
