|April 25th, 2006, 01:31 AM||#1|
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Container Shipping - A History
Containerized shipping began with N.C. man 50 years ago
By BONNIE PFISTER
23 April 2006
NEWARK, N.J. (AP) - Fifty years ago on April 26, a trucker from Maxton, N.C., ran an experiment here that forever altered international trade and the global economy.
While many scoffed, Malcolm McLean hired a crane to hoist 58 trailer-sized steel cargo boxes onto a Texas-bound freighter. It was an alternative to the then-ubiquitous "break-bulk" shipping, the costly, pilferage-prone method dramatized in the film "On The Waterfront."
It was a revolutionary idea in shipping and a huge business risk for McLean.
He sold off the trucking firm it had taken him 20 years to build, in compliance with the era's antitrust regulations. And he retrofitted an old oil tanker, the Ideal X, with a reinforced flat deck specially designed with grooves to secure the containers in place for the maiden voyage down the Eastern seaboard and into the Gulf of Mexico.
By the time the tanker docked at the Port of Houston six days later, McLean's Sea-Land Services was taking orders to ship containers back north. Transoceanic shipping eventually followed, ushering in what observers call the biggest change in freight transport since steam engines replaced sails.
"There are few instances in history where innovation has had such a dramatic impact," Anthony Coscia, chairman of the Port Authority of New York and New Jersey, said Friday. "Malcolm McLean gave birth to a way of moving goods around the world that promoted global economic development that has been very positive for New Jersey and the U.S. economy."
Break-bulk, which is still used for true "bulk" commodities such as construction materials, involved armies of stevedores loading individual crates from a dock to a sling, which was then hoisted up and then down into a ship's hold, to be unloaded and positioned there.
Now shipping everything from clothing to razor blades to electronics in secured metal containers is the norm. Breakage and theft have been dramatically curtailed, and average shipping costs have fallen from 15 percent of retail value to less than 1 percent. At the Port Authority's New Jersey locations -- ports Newark and Elizabeth -- containerization accounts for 94 percent of the cargo, with break bulk about 1 percent; automobiles account for the remainder.
Over the years, that development set the foundation for big-box stores crammed with inexpensive items, allowing shopping to morph from necessity to entertainment. The advent of refrigerated containers meant no matter the season, grocers could offer fresh produce grown half a world away for reasonable prices.
"Products that couldn't move because of the export packaging and damage and so forth move freely now throughout the world," said Paul F. Richardson, a shipping consultant who worked side by side with McLean for Sea-Land's first 20 years. "It was a huge breakthrough."
McLean died in May 2001 at 87, two years after selling Sea-Land, then the world's seventh-largest shipper, to Denmark's Maersk for $800 million.
"I'm not sure if he graduated from high school, but he was brilliant," Richardson said. "He could do compound math in his head. He wasn't afraid of risk. In fact, I think he thrived on it."
But the container revolution, like many efficiency-creating innovations, also spelled the end to countless well-paying jobs, both in shipping and in manufacturing.
"It used to be if you took a ship with five cargo holds, it would take two shifts a day of up to 20 longshoremen for a week to unload it," said Arthur Donovan, a former history professor at the U.S. Merchant Marine Academy in Long Island, and co-author of "The Box That Changed The World." Today, a comparable job would take about 10 hours with three or four container cranes, employing fewer than 20 workers, he said.
"It makes the whole world like a slick surface: you can slide anywhere at almost no cost," Donovan said. "If you have pool of cheap labor that's ready to work, you simply outsource. The purpose wasn't to disemploy people, but it's the consequence of falling transportation costs."
The result is a generation of American consumers weaned on superstores. Wal-Mart is the leading user of shipping containers, followed closely by Target, Ikea and Home Depot, Donovan said.
"It's transformed retailing," he added. "The big box experience is a product of containerization."
Events commemorating the anniversary are scheduled at Port Elizabeth, N.J. on Tuesday and the Smithsonian Institution in Washington D.C. Thursday.
On the Net:
Port Authority of New York and New Jersey: http://www.panynj.gov/
History of Containerization Foundation: http://www.hocfoundation.net
|October 28th, 2007, 08:48 AM||#2|
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Dilemma: How much greener are ships than planes?
Are your Christmas presents coming by sea from China?
New superships are making all the wrong waves
28 October 2007
In the late Eighties I went on a rather dull school trip to Dublin Port and Docks (I went to school in Dublin, near the docks, so this was a more prosaic outing than it might sound). The one shining moment, however, was seeing a container ship that had arrived from Japan. It dwarfed the surrounding buildings and seemed to block out the sky.
At just 4,000 TEU (the container ship measurement, meaning 20ft-equivalent units, or a container), that ship would now appear ridiculously puny. The new generation of megaships can carry 11,000 TEU. When the Emma Maersk docked in Felixstowe this time last year it was promptly dubbed SS Santa . At 397m long (the size of four rugby pitches) and 56.4m wide, she carried 45,000 tonnes of Christmas goodies, trainers, MP3 players, T-shirts and plastic toys.
Pound for pound, shipping is greener than aviation in terms of emissions, but that doesn't make it eco-friendly. Shipping emissions account for 5 per cent of total global emissions, producing between 600-800 tonnes of CO2 a year. And 70 per cent of ocean-going ship emissions occur just off the coast, impacting mostly in the form of acid rain and leading to severe coastal erosion. According to some commentators, the trade has been treading water when it comes to greening its act, while other modes of freight (including aviation) have made big savings.
Bigger vessels don't help. Even if new megaships have a heat-recovery system, it's a bit like fitting a Hummer with a solar-powered clock. Significantly, the size and weight of new ships, along with increased traffic (there are now 200m container movements across the world each year), have a huge impact on port and waterway expansion - so Panama's canal expansion is just tough luck for the biodiversity of the surrounding Paradise Hill area.
Perhaps this would all be more palatable if containers were carrying important cargos - say, solar panels, or warm socks for orphans. But when the Napoli ran aground off the coast of Devon last year, it disgorged the usual array of trinkets, tyres and toys, along with 200 tonnes of waste oil.
The rise of the super-container, and of sea freight's footprint, has everything to do with burgeoning consumerism. You could argue that an even greater load of rubbish is sent back on the return journey, as we export the bulk of our recycling to China. But this isn't really the point. Only 75 per cent of containers contain anything on their return journey (including rubbish).
The irony is that as global warming escalates more shipping routes are opened up. Melted ice in the Canadian arctic might feasibly allow ships to sail from Europe to east Asia avoiding the Suez or Panama Canals (there's another irony, given the latter's expansion plans), saving fuel and therefore emissions. Shipping could become greener for all the wrong reasons.
|September 19th, 2008, 03:10 AM||#3|
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BBC to follow transport container
15 September 2008
International Freighting Weekly
The BBC will be following a container transporting a range of goods as it travels around the world to help highlight the importance of the container shipping industry.
The container began its voyage in Southampton on 8 September on its way to Scotland where it will be loaded with whisky.
Then it's off to China where it will be loaded with goods ranging from car parts to footwear.
It is hoped the container will make it back to the UK by summer next year.
The journey is being organised by the Container Shipping Information Service (CSIS), which represents the largest 24 shipping lines.
The container's progress can be tracked on www.bbc.co.uk/thebox or CSIS's own website, www.shipsandboxes.com
|July 10th, 2009, 05:52 PM||#4|
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Spate of containership sales confirms depth of price drop
30 June 2009
THE number of modern containerships sold has risen in the past month, providing crucial price guidance to the struggling sector.
The resale of the 1,700 teu newbuilding Cynthia, under construction at bankrupt Wadan shipyard in Germany showed that prices have fallen dramatically in the last year. Receivers have reportedly negotiated a price of €15m ($21m) for the gearless containership with buyers Briese Schiffahrt.
A spokeswoman for Briese told Lloyd’s List yesterday they were still negotiating and could not confirm the sale details.
If it goes ahead, the price is about 20% lower than the value a similar-sized but much older containership fetched back in 2007. London-based broker Clarksons priced the average value of a 1,700 teu, 10-year-old containership at $26.5m in 2007, and $24m last September.
The broker is one of many that has now stopped providing valuations for vessels since the banking and financial crisis saw prices plummet.
But while bulk carrier and tanker sales have continued to set benchmarks, very few modern container vessels have been sold.
Allied Shipbroking reported earlier this month that 26 containerships had been sold in 2009, compared to 126 tankers and nearly 370 bulk carriers.
London-based consultancy Maritime Strategies International said that secondhand boxship prices have already collapsed by 60% since last year, and have further to go.
“We envisage potential falls of up to 20% for benchmark 10-year-olds on the back of a declining newbuilding price environment. There is limited downside to the charter market,” MSI told Lloyd’s List yesterday.
Despite the poor outlook there have been more sales reported in the sector in the last two weeks.
Brokers this week reported unconfirmed news that K Line had sold two gearless containerships of 3,720 teu, including the 1993-built Akashi Bridge and Bauhinia Bridge as part of a $15men bloc deal.
Clarksons valued a 10-year-old containership of this size at $46.5m last September.
Sanko Steamship has reportedly sold two 1,700 teu vessels, Ocean Emerald and Ocean Mermaid, but neither the price nor the new owners have been disclosed.
That comes on top of the distressed sale of bankrupt owner Eastwind’s containerships to Draften Shipping, a subsidiary of the Ofer Brothers.
The Eurus Oslo and Eurus Ottawa, both built in 1989 with capacity for 2,097 teu, were sold, as well as the smaller Eurus Lisbon (1991-built, 950 teu), Eurus Paris (1983-built, 580 teu) and Eurus Singapore (1989-built, 1,555 teu).
This article is compiled on the basis of publicly available sources. Reported transactions may not have been confirmed with the buyers or sellers named. Accordingly, Lloyd’s List cannot guarantee the accuracy of the information.
SLS tanker resales join S&P market as owners cancel SOUTH Korean shipyard SLS Shipbuilding is now looking for buyers for as many as four medium range tankers, after their owners this month cancelled their contracts just before delivery, writes Michelle Wiese Bockmann.
The resales have emerged on the market at a time when brokers are forecasting a drop of at least 15% on current values for secondhand, clean tankers.
“We foresee prices weakening further leading to a re-evaluation of sellers’ price expectations,” said Gibson in its weekly sale and purchase report. “We estimate the market needs a correction of at least 15% in prices before asset players perceive this market to be a risk worth taking.”
SLS placed the resales on the market after both Stolt Nielsen subsidiary Stolt Tankers and Glencore joint-venture Glenda Shipping cancelled orders this month. Both cited excessive delays at the yard.
Stolt cancelled two 44,000 dwt coated parcel tankers, while Glenda had cancelled the order for one 51,000 dwt product tanker with a second due for delivery this month also likely to be cancelled.
These latter two ships were ordered at a price of $47.5m each.
Galbraith’s said it expected tanker resales to become an emerging trend over the following months, due to cancelled orders. This seemed to be underscored by rumours of another promptly available tanker, a very large crude carrier, circulated for sale by a South Korean yard at $100m.
“So far, there are few takers at this level,” said Gibson.
The price compares with the Baltic Exchange sale and purchase assessment price of $83.5m for a five-year-old VLCC, down more than $10m on values seen four months ago.
Brokers believe cash-rich owners are waiting for further drops in asset prices, perhaps with one eye on the pressure that the emerging resale tanker market could place on already distressed sellers.
Gibson also reported unconfirmed rumours that Iranian buyers may have bought some VLCCs built in the mid-1990s for $54m-55m but the deal had yet to be fully concluded.
The 1995-built 298,306 dwt Songa Chelsea was one that was reportedly on subjects, Gibson said.
The VLCC is owned by V Ships Group.
“There has been a strong undercurrent of interest in the large crude sector of late but there are few ‘market’ sellers in the present climate,” said the Gibson report.
Clarksons also reported buyers from South America, Indonesia and the Middle East had shown interest for double-hulled VLCCs built in the mid 1990s.
Clarksons also said the sale of the 1993-built, 97,097 dwt Chemtrans Lyra, committed to Indonesian interests at $16.5m, had failed as the owners wanted more than $18m.
Vela International is also selling another two single-hulled VLCCs, including the 1994-built 291,435 dwt Al Bali Star. The Saudi Arabian subsidiary of government-owned oil major Aramco has already sold at least four single-hulled VLCCs over the last year.