The Return of Somali Pirates: A New Disruption of Global Shipping

Supply chain professionals have been battered by a relentless storm these past few months. Disruptions in the Red Sea due to Houthi attacks, ongoing struggles with the Panama Canal caused by climate change, and now, the unwelcome return of Somali piracy – a problem everyone thought was under control.

In this article, we’ll explore what’s causing this new resurgence in piracy in the western Indian Ocean, how it’s impacting global supply chains, and what supply chain managers can do to avoid the worst consequences.

The return of piracy in the Indian Ocean

Last Tuesday, March 12, 2024, the MV Abdulah, a bulk freighter carrying coal from Mozambique to the United Arab Emirates, was hijacked by a group of pirates.

This is the most recent of over a dozen pirate attacks in the Indian Ocean in the past few months, and many supply chain professionals are worried about a full-blown resurgence.

Somali pirates’ golden age

If you’ve been in supply chain management for 15 years or more, this news likely brings back bad memories. Somali piracy in the Indian Ocean was “a thing” between 2008 and 2014.

At its peak in 2011, there were almost 240 reported hijackings. These attacks earned the pirates nearly $400 million in ransom money, costing the world economy an estimated $7 billion that year alone.

How we solved this the first time

In the years after 2011, the world managed to get things under control in the Indian Ocean through a combination of actions, including:

• International naval forces increased patrolling of the Gulf of Aden and the Somali coast.
• Enhanced private security measures like employing armed guards.
• Implementing maritime security best practices like hardening vessels against boarding.
• International aid programs aimed at tackling poverty and instability in Somalia.

These measures all but ended piracy in the Indian Ocean by 2015, with only eight reported attacks in the six years from 2016 to 2022, compared to 358 attacks during the previous six years.

But now, they’re back!

A new wave of Somali pirate attacks

The Abdulah hijacking was just the most recent (and most noticeable) in a series of Somali pirate attacks in recent weeks. Since November last year, there have been at least two large vessel hijackings and 12 attacks on fishing ships.

Unlike the wave of attacks 10 years ago, many of which happened in the Gulf of Aden, pirates are now attacking ships in the Indian Ocean off the Somali coast of Garacad.

While nowhere near the frequency and scale of 2011, this could signal a worrying resurgence that shippers and supply chain managers must keep an eye on.

A window of opportunity

You’re probably wondering why this is happening. Why now?

Some reports suggest that Somali pirates view the current situation in Gaza, the Red Sea, and Ukraine as an opportune moment to re-establish themselves. They are exploiting a decrease in international naval patrols off the Somali coast.

In other words, they’re taking advantage of the international community's diverted focus on other maritime threats.

The perfect storm in global shipping

Existing problems in global shipping are not just causing the return of Somali pirates; they’re making them worse.

The world is already struggling with two wars, a collapse in the Panama Canal caused by a lack of rain, and worsening Houthi attacks in the Red Sea, which, by now, have killed three people .

A renewed threat in the Indian Ocean by Somali pirates adds another layer of complexity to an already hard-to-navigate global supply chain.

Impact on global supply chains

The return of Somali piracy has a direct and multifaceted impact on global supply chains:

• Disruptions and delays: Potential hijackings and disruptions caused by pirate activity lead to shipment delays. This can have a domino effect, impacting just-in-time inventory models and production schedules.
• Rising shipping costs: Shipping companies face increased costs for armed security guards, outfitting ships with anti-pirate protective measures, and higher insurance premiums.
• Crew concerns: Heightened security risks for seafarers add another layer of concern, impacting crew morale and recruitment.

The road ahead: Mitigating risks in a complex landscape with BabelusAI

At BabelusAI, we understand the challenges posed to supply chains by current events. We offer a suite of tools and services that can help procurement officers, supply chain managers, and risk managers navigate this complex landscape by:

• Finding and evaluating potential suppliers from different regions and countries based on technical requirements.
• Cutting supplier discovery times by as much as 90% .
• Comparing, shortlisting, and selecting the best suppliers for your needs.

Send us a message now to learn how to stop supply chain disruptions with BabelusAI, or join me on a call to discuss developing a pilot for your company at no cost.