Maritime Industry Mr. Dave DeBoer Lesson Objectives Introduction - - PowerPoint PPT Presentation

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Maritime Industry Mr. Dave DeBoer Lesson Objectives Introduction - - PowerPoint PPT Presentation

Dec 26, 2023 209 likes •646 views

Maritime Industry Mr. Dave DeBoer Lesson Objectives Introduction to the basic principles and components of the Maritime industry Introduction to the Maritime industrys issues and challenges in the 21 st Century Understand the

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Maritime Industry

  • Mr. Dave DeBoer
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Lesson Objectives

  • Introduction to the basic principles and components of the

Maritime industry

  • Introduction to the Maritime industry’s issues and challenges in

the 21st Century

  • Understand the U.S. Maritime industry’s contribution

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Maritime transportation has many moving parts and they all have to work together in unison

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Issues in one area have a tendency to impact other areas

  • 1. Trucker Shortages
  • 2. Port Congestion
  • 3. Rail Congestion
  • 4. Chassis Shortages
  • 5. Vessel Alliances
  • 6. Weather

Maritime Industry

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Quick (Rough) History

  • 5000+ Years of Maritime Trade
  • Phoenicians – Greeks – Romans – Venetians – all operated

merchant fleets

  • Dutch – Spanish – British – US etc. (you get the picture)
  • Trade Routes
  • Evolutionary Developments
  • Ships
  • Iron ships, screw propellers
  • Steam, diesel , and LNG propulsion plants
  • Friction reducing, self sealing paint, fuel additive, hull cleaning
  • Container ships getting LARGER
  • RO/RO Vessels getting wider and longer

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Quick (Rough) History Cont

  • Evolutionary Developments

– Seaports – Productivity improvement efforts – Canals: Suez – Panama – Intermodal Transportation – Railway – Landbridge, Mini-Landbridge – Stack trains – Trucks – Sizes, Economy, Environment – Sea-Air, Transloading on West Coast

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Maritime Industry Principles

  • Maritime industry devoted to moving goods or passengers by water.

(That simple…)

  • A service business…
  • Maritime Activities:
  • Vessel Operations (merchant shipping)
  • Shipbuilding (merchant & naval)
  • Ports
  • Marine Resources (Offshore oil/gas)
  • Marine Fisheries (Marine fishing, seafood processing)
  • Other (Marine Tourism, R&D)

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Maritime’s Link to Global Economy

  • Ships carry 99% of overseas trade in volume terms and 62% in

value terms, the remainder being conveyed by air

  • 90% of all international trade moves by sea
  • Globally, the ton-miles of freight moved by water are more than

twice the total ton-miles of freight moved by road, railway and air combined…

  • Water transportation is

less costly and more energy efficient than

  • ther modes:

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Source: http: www.wistrans.org

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Major Industry Challenges

  • Overcapacity
  • Freight rates
  • Contending with Industry Consolidation
  • Prioritizing Maritime, Freight Investments
  • Operating costs
  • High fuel prices
  • Contending with Labor disputes
  • Environmental restrictions
  • Piracy/Security
  • Labor shortages

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Industry Framework

  • Dominated by large Multinational Companies with global ocean and

multimodal networks

  • Capitol Intensive
  • Short commercial life span for a container vessel?
  • Other types of vessels up to 40 years
  • High Barrier for entry
  • Highly Regulated
  • Governments
  • Flags of Convenience
  • Host nation flags
  • If you are a US Flag Vessel?
  • History of deep swings in profits and loss cycles
  • Profitability impacted by supply and demand
  • Operating costs drive decisions in a “For Profit “ business.

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Large Multinational Corporations

Top Container Lines as of August 2017

Rank Company TEU Market Share # of Ships 1 Maersk 3,570,355 16.80% 662 2 Mediterranean Shipping Co 3,133,328 14.70% 511 3 CMA CGM Group 2,497,101 11.70% 489 4 Cosco 1,886,402 8.50% 329 5 Hapag-Lloyd 1,491,284 7.00% 213 6 Evergreen 1,058,530 5.00% 194 7 OOCL 669,902 3.20% 100 8 Yang Ming Marine 586,068 2.80% 97 9 Hamburg Sud Group 556,068 2.60% 105 10 MOL 544,504 2.60% 77 11 NYK Line 540,702 2.50% 97 12 Pacific International Line 381,174 1.80% 136 13 ZIM 366,689 1.70% 75 14 Wan Hai Lines 219,396 1.00% 87 15 X-Press Feeders Group 160,985 0.80% 100 6,035 Ships with containers 5,172 Pure container ships 21,338,548 Total Global TEU's Aug-17 Alpha Liner

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Let’s talk Cost

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Vessel Construction $190 M Containers for vessel $ 63 M Support Equipment $ 14 M Total $ 267 M

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18,000 TEU container vessel

OPERATING COST

  • 1. Crew Cost
  • 2. Repair And Maintenance
  • 3. Insurance

4. Administration including Loan 5. M & R VOYAGE COST

  • 1. Fuel Cost
  • 2. Port charges
  • 3. Canal Charges
  • 4. Daily Cost of the Ship

5, Stores and Oils

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Other Costs

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After January 1 2015 ships operating within Emission Control Areas (ECAs) are required to burn fuel with less than 0.1% sulfur content

Cost prior to Jan 1 tons per day days cost per ton Cost per voyage 380 18 $322.50 $2,205,900.00 Cost post 1 Jan 2015 assuming in ECA zone 38% of voyage tons per day days cost per ton Cost per voyage 380 18 $408.00 $2,790,720.00

  • Inc. cost

$584,820.00

Regulations having an impact on shipping costs Emission Control Areas (ECAs) are sea areas in which stricter controls were established to minimize airborne emissions (SOx, NOx, ODS, VOC) from ships as defined by Annex VI of the 1997 MARPOL Protocol which came into effect in May 2005.

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How to contain costs?

  • 1. Transfer Costs to others
  • 1. Terminal Handling Fees
  • 2. Documentation Fees
  • 3. Shipper/receiver supplies their own chassis
  • 4. Fuel Surcharges
  • 2. Enter into Alliances
  • 1. Increase Frequency
  • 2. Broaden Scope of Service
  • 3. Reduce cost of operations

2 M Alliance MAERSK MSC Ocean Alliance CMA-CGM China Shipping Cosco Evergreen OOCL The Alliance Hapag-Lloyd NYK K Line MOL Yang Ming

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What does Alliances do for a shipping company?

Optimization:

  • For example, an alliance that offers multiple weekly sailings can eliminate somw
  • f their ships
  • Expanded geographic cover with fewer vessels

Supply Chain Benefits

  • With Alliance an Ocean carrier alliances can better analyze, forecast, and

capacity-plan for their fleet.

Lower Cost

  • unit costs will decrease

Enhanced Service

  • increased competition among alliances should bring about improvements in

service, as well as improved solutions for their customers. Source : http://www.gocatapult.com/

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Basic Concepts to think about

Think space…Think volume…Think efficiency

  • RORO/breakbulk transportation
  • Cubic Feet (12X12X12 divided by 1728)
  • Long Ton = 2240 pounds
  • Short Ton = 2000 pounds
  • Metric Ton = 2204 pounds
  • Measurement Tons (1 M/T equals 40 Cubic Feet)
  • Containerization
  • Impact of containers on the globe (see “The Box”)
  • Standardization of container sizes
  • 20’, 40’, 45’
  • Unit of measure Twenty Foot Equivalent Units (TEU)
  • Slot costs
  • Cost per TEU per mile

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Types of Vessels

  • Container – Made door-to-door delivery possible
  • Roll-On-Roll Off (RORO)
  • Lift-On-Lift Off (LOLO)
  • Barge
  • General
  • Float-On-Float Off (FLOFLO)
  • Bulk(Dry and Wet) Tankers
  • Cruise
  • Ferry
  • Tug
  • Specialized
  • Gas Carrier – Liquefied Natural Gas (LNG)
  • Chemicals – Forest Products – Refrigerated

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Panamax – Post Panamax

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Source: http://www.oil-electric.com/2011_08_01_archive.html

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What does an expanded Panama Canal mean to me?

Lower transportation Costs

  • Relieves port/rail congestions on the US West Coast
  • One ship carries as much as 16 trains worth of cargo
  • Doubles the canal's capacity
  • Larger cost effective ships transiting the canal
  • Better through put of cargo ships with no dwell time
  • Allows US Exporters/Importers better access to China and other Asia

destinations

  • Lower environmental impact using all water services

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  • Liner Services
  • Fixed schedules to fixed ports
  • Tramp Services
  • Chases the cargo…
  • Contract/Charter carriers
  • Employed by one shipper
  • Numerous types of hiring terms
  • Company Fleets
  • Exclusively moves company products

Business Models

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Types of Vessels

  • Container
  • Roll-On-Roll Off (RORO)
  • Lift-On-Lift Off (LOLO)

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Containers carriers providing factory to foxhole capability Global service

  • fferings Include

intermodal routes and equipment

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Container Ships

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Class of Container Vessels

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Container shipment: How it happens

Twist lock: how containers stay connected

Containerization enables cargo to move seamlessly in the supply train A process continually striving to reduce costs by removing waste, rework and redundancy

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Container shipment: How it happens

  • 1. Ship is separated into Bays, Rows, and tiers
  • 2. Origin(s) load by port of discharge and priority of final destination of

cargo

  • 3. Discharge port unloads by final destination of cargo
  • 1. Cargo traveling the furthest from load port is usually off first
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  • Discharge Operations
  • Containers move direct to
  • n-dock rail for loading to
  • utbound trains
  • Local containers staged in

port for local pickup

  • Train or truck to final

destination

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Container Terminal Layout

Main objectives

  • 1. Minimize vessel

turnaround times

  • 2. Maximization of quay

crane throughput. Areas of optimization (1) ship planning (2) storage and stacking logistics (3) transport optimization

Source :http://www.orms-today.org/orms-4-07/ports.html

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29 RORO vessels provide shippers with access to the global marketplace

Ro-Ro is an acronym for Roll-

  • n/roll-off. Roll-on/roll-off ships are

vessels that are used to carry wheeled and breakbulk on MAFI

  • cargo. The cargo for the ship is

loaded and unloaded by means of built-in ramps.

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Anatomy of a RORO Carrier

A floating parking garage with limitations based on the height of the stern door, how much weight the stern ramp can support , and internal flexibility of deck heights

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Cargo Rolls On or Rolls Off

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If it can’t roll on itself MAFI trailers

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RORO Terminal Yard

Main objectives Minimize vessel turnaround times Maximization of throughput. Areas of optimization Ship planning Yard logistics Transport optimization How to get these cars on that ship the most efficient and least expensive way possible?

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Once inside the ship..the more we fit the better things are…..

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Pure Car Truck Carrier PCTC

  • Optimized for cars and mix of cars,

trucks and heavy rolling units

  • Versatile in terms of cargo mix and load
  • 3-5 Lift-able car decks
  • Slender hull, but able to carry heavier

cargo than a PCC

  • In US Flag Operations they are

commercially viable and military useful

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RORO Carrier

  • No fixed car decks
  • RORO carriers are optimized

for High & Heavy cargo with cars as supplementary cargo

  • Stern ramp 250 < 500 tons
  • 3-4 Hoistable decks
  • More full body hull than a

PCTC – heavier cargo

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Bulkers/Heavy Lift vessels

Traditional loading methods for bulk ships

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What’s new in the news

Safety of Lift At Sea (SOLAS) Mis-declared container weights have a serious impact on the stability of vessels, trucks and terminal equipment. This can pose a threat to the safety

  • f workers in the industry and even endanger lives.

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Ports

  • Stakeholders:
  • Port Users:
  • Carriers- ship owners transport cargo
  • Shippers and passengers
  • Port service providers
  • Fuel, Steam, Waste Removal
  • Terminal operators, ship agents, freight forwarders,

customs brokers

  • Infrastructure
  • Suppliers
  • Shipyards / Maintainers
  • Long Shoremen

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Port Sizes and Internal OperationsVary Port to Port

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Ports of Los Angeles and Long Beach, California Port of Miami, Florida

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Obstacles facing ports today

  • Greater operational complexity resulting from much bigger ships
  • Managing congestion risk
  • Dredging to accommodate Mega Ships
  • Staying profitable though shipping line economic cycles
  • Contending with Industry Consolidation
  • How do you grow the port?
  • Non Commercial Development encroaching on Port property
  • Environmental issues to grow and dredge
  • Labor
  • Stoppages/Strikes
  • Productivity-use of technology
  • Growing a work force that require new skill sets
  • What to invest in?
  • Port Infrastructure
  • Growing warehousing and distribution facilities
  • Road access to the facility

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