Prices for the services of private security firms for merchant ships in the Red Sea region have risen sharply recently due to increased piracy and Houthi activity, Somali news portal Shabelle Media Network citing data from specialist analytics group Splash Extra.
The demand for professional security has increased significantly since the beginning of 2024, and the cost of a three-day job of security guards on board a ship starts at 20,000 USD. Bulk carriers are mostly affected. At the same time, the price depends a lot on independent appraisers who determine the cost of protecting a particular ship. Their activity is not regulated in any way, and the price of the security services they set can vary significantly. For example, the estimates of two experts differ by more than a quarter in the case of the container ship Ever Given, which may have become the most famous merchant ship in the world after blocking the Suez Canal 3 years ago.
"The work of appraisers is not regulated in any way in the global shipping market, and banks sometimes accept appraisals from any broker without caring about his qualifications," says Basil Karatsas, head of the New York company Karatzas Marine Advisors. “Brokers make money from their commissions, not their initial prices, so predictions may be far from reality.“
After the escalation of the conflict in the Gaza Strip in October 2023, the Houthis announced that they would carry out attacks against Israel and would not allow its associated ships to pass through the waters of the Red Sea and the Strait of Bab al-Mandeb stop until the military operation in the Palestinian enclave stops. Since mid-November last year, the rebels have attacked dozens of civilian ships in the Red Sea and the Gulf of Aden.
According to the news portal Africa News, Somali pirates, rarely mentioned in the media for the past 10 years, have reactivated and are threatening shipping in the Horn of Africa. Since last November, there have been 20 attempts by pirates to hijack ships in international waters off the coast of Somalia.