Effects of Middle East Crisis on Dry Bulk Carriers Charter Rates between Port of Mersin and West African Routes

Abstract

This study evaluated the impact of the Middle East crisis on voyage charter rates for Handymax bulk carriers between the Port of Mersin (Turkey) and the West African port of Apapa, Lagos. It used secondary time-series data from January 2023 to June 2024, the study applied descriptive statistics, ANOVA, and trend analysis to compare pre-crisis and crisis-era freight dynamics and forecast future rates. The results and findings of the study indicate that the average freight rate in the pre-crisis era stood at $1,396.67/ton, while during the crisis era it rose significantly to $1,894.44/ton, reflecting an increase of $497.77/ton. Variance analysis revealed heightened market volatility in the crisis era, with broader rate dispersion due to geopolitical risks, increased insurance premiums, and longer voyage times caused by route diversions. Trend analysis showed upward movement in rates for both periods, though the increases were not statistically significant, suggesting that the sharp cost escalation was crisis-driven rather than time-induced. Forecasts for July 2024–June 2025 project average rates of $1,933.17/ton, with peaks above $2,075/ton if the crisis persists. These sustained increases are expected to translate into higher import prices, raw material costs, and inflationary pressures in West Africa, with direct implications for commodity affordability and industrial competitiveness. The study concludes that geopolitical instability in the Middle East materially influences freight markets beyond the region, burdening dependent economies such as Nigeria. Policy measures recommended include targeted tax reliefs for manufacturers, investment in regional shipping capacity, and strategic reserves for critical imports to cushion against cost-push inflation.