Risk now a defining variable for breakbulk and project cargo moves

Risk has become the defining variable shaping breakbulk and project cargo routing decisions, vessel deployment, port selection and project execution across global supply chains, according to speakers on a Sept. 17 Journal of Commerce webcast.

Drawing together perspectives from maritime security, fleet analysis and project logistics, panelists said the sector is increasingly navigating a world in which geopolitical instability, congestion and infrastructure constraints can have a greater impact on freight outcomes than underlying supply and demand.

Much of the discussion centered on the Middle East, where shipping operators continue to face elevated risks in both the Strait of Hormuz and the Red Sea.

“The most acute maritime threat point is in the Strait of Hormuz — that's where shipping currently faces an extreme level of risk,” said Jack Kennedy, research and analysis director at S&P Global Market Intelligence Country Risk, citing ongoing concerns over missile attacks, naval activity and uncertainty surrounding the deployment of naval mines.

For breakbulk and project cargo operators, however, the challenge extends far beyond the threat of direct attacks. Kennedy argued that risk perception itself has become a powerful market force.

“Even if the main shipping lines through the Strait of Hormuz are eventually cleared, the perception of risk and the uncertainty that that generates is probably going to discourage a lot of operators from resuming transit,” he said.

Longer-term hesitation has significant consequences for project cargo movements, many of which involve high-value equipment, bespoke supply chains and inflexible delivery schedules. Unlike commodity cargoes, large industrial projects often cannot absorb extended delays or sudden route changes without triggering additional costs throughout the project lifecycle.

The Red Sea provides a clear example. According to Kennedy, even periods of reduced conflict do not automatically restore confidence among shipping operators. “The lag time that comes after a conflict can be just as impactful as the actual conflict time itself,” he said.

For shippers, that means rerouting decisions made during a crisis can continue long after active hostilities decline.

Ripple effects of routing restrictions

The operational consequences are already visible. Susan Oatway, senior research analyst for breakbulk and project cargo at S&P Global Market Intelligence, noted that many breakbulk and project cargo vessels continue to avoid traditional routes through the region, contributing to tighter vessel availability and longer voyage distances.

The result is a cascading effect across global project logistics networks. Longer rerouting around the Cape of Good Hope removes effective capacity from the market, while congestion at alternative gateways places additional pressure on already stretched supply chains.

Geopolitical conflict is only one dimension of the risk equation, though. For project cargo specialists, climate-related disruptions and infrastructure bottlenecks are increasingly creating similar challenges. The Panama Canal was repeatedly cited as an example of how external events can derail carefully planned operations.

Oatway said carriers and shippers are already factoring canal restrictions into routing decisions. “You’re looking at increased rerouting, or you’re looking at a huge payment additional to your cargo,” she said.

Kevin Kwateng, founder and CEO of Project Logistics Engineering Solutions, gave a real-world example involving a move of refinery modules from China to Montreal. Restrictions at the canal generated delays, additional costs and planning complications that rippled through the broader project schedule.

What makes such risks particularly acute in the project sector is the interconnected nature of delivery schedules. Heavy-lift transport equipment, specialized labor, permits and receiving-site preparations are typically planned months in advance.

“These delays shift the schedule, which means that you have to start over from the beginning in terms of scheduling,” Kwateng said.

Port risk is emerging as another major concern. According to Kwateng, congestion is no longer limited to the largest container gateways. Growing volumes of wind energy equipment, battery projects and large industrial cargoes are placing unprecedented strain on breakbulk and project cargo terminals.

“One of the things that we’re seeing is a lot is ports just simply not being available to meet the demand,” he said.

For project cargo shippers, finding an alternative port is often easier said than done. Routes from terminals to final destinations frequently require years of engineering studies, bridge assessments, utility clearances and permitting work.

“Just because you can get to a port, it doesn’t mean it’s the right one,” Kwateng warned.

That reality has forced many project owners to adopt a far more flexible approach to risk management. Rather than relying on a single transportation plan, companies are increasingly developing multiple contingency options before cargo even begins moving.

“The only solution that actually exists is the solution that you have in front of you,” Kwateng said. “People are getting more creative.”

This article was originally published by the Journal of Commerce on Sept. 18, 2026.