Red Sea Crisis Causes Obstruction In The Transportation Of PV Modules In Yemen
On June 12, 2025, Israel launched a series of air strikes on Yemen, with Sana'a International Airport and Red Sea ports becoming the main targets of attack.
The attack caused catastrophic damage to Yemen's infrastructure, especially the port of Hodeidah, which, as the main material transportation channel in Yemen, has been completely paralyzed. Hodeidah Port has been responsible for importing most of Yemen's humanitarian aid and commercial goods. Before the escalation of the Red Sea crisis, the port had experienced twists and turns due to Yemen's long-term civil war.
Today, port facilities have been severely damaged in air strikes, the docks cannot be used normally, and the loading and unloading equipment has been destroyed to varying degrees, which has brought the already fragile material transportation system to the brink of collapse.
Longi, Risen Energy and other companies that have actively deployed in the Yemen PV market are the first to be affected. A large number of the 200MW Hi-MO X10 module orders signed by Longi at the World Future Energy Middle East Exhibition, as well as the module containers required for Risen Energy's 340kW distributed PV project in Ibb Province, Yemen, are stranded at the Port of Hodeidah.
Due to the port's inability to operate normally, these modules could not be cleared and shipped to the project site on time, resulting in the delay of the construction progress of some projects. Due to the lack of key components at the construction site, the workers had to temporarily stop work and wait, and the overall progress of the project was completely disrupted, which not only increased the time cost of the project, but also may face the risk of default due to delayed delivery.
The freight rates on the Red Sea route have also seen an astonishing increase due to the crisis. Since the beginning of 2025, the freight rates on this route have risen by 208% compared with the beginning of the year. This is mainly due to the sharp deterioration of the security situation in the Red Sea region, and shipping companies are facing extremely high risks.
In order to cope with the potential threat of attacks, shipping companies have to take additional security measures, such as increasing escorts and increasing insurance limits, and these additional costs are directly passed on to freight rates.
Taking the transportation of PV modules as an example, the logistics cost per watt has increased to RMB 0.108, which is undoubtedly a double blow to PV projects that are already cost-sensitive. High logistics costs have squeezed the profit margins of enterprises, and some small PV projects may even face the risk of failure due to cost overruns.
Faced with such a dilemma, enterprises have to start looking for alternative transportation solutions. Going around the Cape of Good Hope has become one of the options considered by some companies.
However, going around the Cape of Good Hope means a significant increase in the voyage. From Asia to Yemen, it used to take a short time to go through the Red Sea route, but now it takes a lot more time to go around the Cape of Good Hope, and the delivery cycle is extended by 15-20 days. For PV projects with tight timelines, this may cause serious delays in project progress and miss the best construction season or grid connection time.
Another option is to transship through the China-Europe Express, but the transportation capacity of the China-Europe Express is limited, and its route planning and transportation time are relatively fixed, which cannot fully meet the urgent transportation needs of enterprises. In addition, the transshipment process of the China-Europe Express is relatively complicated, requiring reloading and transit at multiple stations, which also increases the risk of cargo damage and loss.
The impact of the Red Sea crisis on the Yemeni PV market is comprehensive. It not only affects the advancement of current projects, but may also have a profound impact on future investment decisions of companies in the Yemeni PV market.
If the crisis continues and the problem of obstructed transportation of PV modules is not effectively solved, the development pace of the Yemeni PV market will be seriously dragged down, and the road to achieving renewable energy development goals will become more rugged.