Not so objective 2017 review

Not so objective 2017 review

There are different attitudes that one can have towards the beginning of each new year.

Some struggle to leave the past, overanalysing the previous months. Yet their clock is the only one that stopped. Others treat this opportunity as a blank page and decide to become a whole new person. Each year. Over and over again. There are also the ones spending so much time preparing the yearly-to-do-list, that it ends up longer than their bucket list, and they wake up in December with the pen still in hand.

But although it seems amusing as you stand aside and watch, we all love these yearly recaps and reading New year’s tea leaves.

Various articles have already been published in the shipping world.  If you want to understand 2017 from the economic/financial point of view, we strongly advise you to have a look at 3-part Xeneta publication: https://www.xeneta.com/blog/global-shipping-industry. If you need a summary of the important regulations and changes, you should see the Ship Insight article: https://shipinsight.com/crystal-ball-gazing-2018/.

When you google the topic, you have plenty of options, whether you want a brief summary of 2017 events or a long, yearly analysis of the market.

Yet when others are trying to be impartial and politically correct, instead of focusing on numbers, we will focus on emotions. We’d like to talk about the topics that have touched the shipping industry the most, inspired vibrant discussions and made us feel more human during 2017.

The obvious start would be all the technology madness.

No one would call automation breaking news nowadays, especially as it seems to be a natural and expected step after containerisation started in the late 50s. More than a half-century after that breakthrough, we should not be surprised that the industry is beginning to rely less on humans. The goal is to improve efficiency, reduce the number of mistakes and in general cover the demands of trade. Both port automation and autonomous ships will reduce the environmental impact of the industry and enable shipping to be safer for people, and the planet.

We have had more than enough time to get prepared and contribute to that evolution with our skills, experience and knowledge. Nevertheless, the industry suddenly woke up, realizing that some manual jobs might be in danger of being lost. The question is, can we spend our precious time and apply the amazing abilities of our brains for something greater? Surely technology is a way for us to take up this worthy course.

Apparently not. Instead of developing competencies and learning essential skills, people did what they always do – started finding excuses, most commonly, the problem of cybersecurity. ‘This technology will ruin the world. Nasty hackers will take over our terminals and play Tetris with our containers.’

For some reason, people missed that the problem of cybersecurity is not machines – but ironically – humans. Humans who lack essential knowledge and ignore the regulations, break the rules or are not careful enough to keep the information secured. Simply put, humans do not use technology correctly.

So, technology itself is not the problem here, it’s people who prefer to criticize and waste time looking for problems instead of solving them. To take another example, it’s easy to say that blockchain will affect confidential business models or reveal sensitive data.

Usually, innovation brings lots of uncertainty and challenges, and the natural response for people is to shy away. But guess what, you decide whether the glass is half-full or half-empty. Instead of analyzing the amount of liquid – act. You might change the world.

Don’t misunderstand. I would never say that you should not spend time thinking. The fact that we analyze the problems well before we solve them is the reason we succeed as logistics professionals. The trick is to understand when to think, and when to act. What is more important? Is the subject worth thinking about anyway? We need to ask the right questions to find the right solutions.

Albert Einstein said:

“If I had an hour to solve a problem I’d spend 55 minutes thinking about the problem and 5 minutes thinking about solutions.”

That’s the key to problem-solving. Some people look for solutions before they really understand the problem. We have already found some solutions if it comes to GHG emissions, but neither do we act nor do we understand what this problem really means to the world. But no need to go into that here, it was discussed more than enough in 2017.

Speaking of discussions, how many publications have you seen this year about abandoned crews? We saw lots. On the very next page, we often found articles about how to attract the so-called millennials and young professionals to the industry. Well, I hope these youngsters don’t end up this way!

We could go on and on with these thoughts, but enough of being sardonic for today. We really wish the best for the shipping industry in 2018.

In the end, if the ship sinks, the crew goes down with it.

We enjoy the voyage and we don’t want it to end. Enough of the moaning, it’s a long journey. Instead of ineffective discussions and negative predictions, let’s use the time to welcome all the new solutions and look to improve them with a more positive attitude.

Marine Life: All Creatures Great and Small

Marine Life: All Creatures Great and Small

The container shipping industry has a profound effect on marine life. From the smallest bacteria to the biggest beasts, ships are a direct threat to wildlife and habitats.

Underwater Noise Pollution

The Port of Vancouver recently announced a project to monitor underwater noise pollution in the Haro Strait, running from August to October this year. Marine life conservationists suggest that noise pollution has brought Orcas in the Salish Sea to near extinction, so the announcement of this study is welcomed by the industry. This could provide an important insight into how Orcas are affected by noise pollution and how we offset the problem.

But the issues extend far beyond North American waters. Ambient noises produced by ships disturb all cetaceans around the world. This group of marine animals rely on sound to communicate, navigate and find prey by transmitting and receiving acoustic information. Scientists call this process ‘echolocation’ and it is vital for their survival. However, noisy ship engines make it much harder for these creatures to thrive.

Various solutions have been discussed. For example, slower sailing speeds are thought to reduce noise pollution thus lessen the disturbance. As a part of their study, the Port of Vancouver has limited vessels to 11 knots to test this hypothesis.

As with so many aspects of modern life, commercial pressures can be used to adjust behaviour. Underwater noise reduction technology exists and the Port of Vancouver offers lower port fees to vessels with the technology installed. Noise reduction measures can be as simple as insulating engine rooms as well as regular maintenance of propellers and hull but the Port of Vancouver can only promote this through this incentive. Vancouver is a world leader in marine conservation but it is fair to say that this technology should be mandatory across all international shipping. The conservation of marine life is a global concern so worldwide legislation is necessary.

Ship Strikes

A ship strike is when a vessel and whale collide nevertheless this can be prevented with slower speeds. It’s predicted when a ship travels at 15 knots or above there’s a 79% chance a strike will be lethal. Considering average cruising speeds are around 20-25 knots it is no surprise this is a serious danger to whales, ships and crews.

Strikes are common occurrences. WWF (the World Wildlife Fund) predicts that, in the Canary Islands, 8 out of 10 known whale fatalities are as a result of collisions.

%

Chance of Whale Fatality at 15 knots

Average Cruising Speed (in Knots)

Dr Jeremy Goldbogan of Stanford University suggested that strikes happen due to the evolutionary makeup of a whale. The sheer size of these beasts means they have never had to defend themselves from predators. There is no innate ‘fight or flight’ mode, so whales don’t know how to deal with the threat of a ship.

Their size makes it hard to dive fast enough to clear a vessel’s path. Some of the most affected species are the biggest, the Humpback Whale and Blue Whale, but ships are getting larger and this adds to the problem. Post-Panamax ships find it difficult to notice whales in the water. Sometimes the ship doesn’t know when they have struck a whale and carcases can become stuck on the bulbous bow and carried for some distance.

To curb this problem the IMO (International Maritime Organisation) have introduced speed limits and Areas to be Avoided (ATBA) for ships. Areas around the Bay of Fundy, Panama and Spain have permanent restrictions while some correspond with the seasonal behaviour patterns. Whale’s behaviour is easily predicted so the IMO can implement seasonal routeing measures in areas such as the Roseway Basin and the Great South Channel which sees seasonal whale distribution. The IMO has also implemented whale reporting and detection networks which allow ships to locate whales in real time. And as numbers of Blue Whales and Humpback Whales are steadily increasing the mitigation measures seem to be working.

Ballast Water and Invasive Species

The shipping industry affects not just the biggest creatures but also the smallest.

Ballast water is an essential part of nautical technology. It gives stability, balance and trim to a ship in poor weather conditions and during voyages without cargo. It works by sucking up water at the port of discharge and stores it in the ballast tanks in the ship’s hull. Once the port of loading is reached the tanks are then unloaded.

But marine life can get into the ballast tanks when water is being taken on. That marine life is then placed into a foreign habitat when the ballast is discharged and newly introduced bacteria, plants and animals can have a devastating effect on ecosystems. Scientists call this a bio-invasion because foreign species can become invasive for native species. Foreign marine life can kill off native species by controlling food resources and this starts a chain reaction as prey dies out.

Throughout history, environmental and humanitarian problems often stemmed from bio-invasions. For instance, problems were seen in the Great Lakes after the Lamprey Eel was introduced. The eels were native to the lakes in the east and were able to move west using newly opened canals in the late-1890s. The eels completely turned the eco-system around by killing off 90% of the native trout in the western lakes. This made many unemployed in the towns around the lakes as the fishing industry vanished.

But a more recent demonstration of a deadly bio-invasion is due to ballast water. In 1991 a type of cholera, only seen in Bangladesh, broke out in Peru. The disease killed over 10000 people in the South American state through the early-1990s. Ballast water introduced the disease to Peruvian waters but a poor public health infrastructure spurred this into a pandemic.

The Deadly Effects of Bio-Invasion:

%

Trout Population Decrease

Deaths from Cholera in Peru

To solve this problem the IMO has adopted the Ballast Water Management Convention (BWMC). The convention requires all ships in international transit to carry a ballast water record and meet regulation standards using ballast water management systems. All ships, both new and existing, must install technology which monitors and manages ballast. This is predicted to cost some ship owners up to USD 5 billion to meet the new IMO standards.

Some have opposed the original enforcement date that was set for 2017. The ICO (International Chamber of Shipping) proposed a further two years to allow existing ships adequate time to implement the changes required by the convention. At the 71st Maritime Environmental Protection Committee (MEPC) meeting in 2017, the ICO’s wish was granted. So we will have to wait until 2019 to see this tech in action across the entire world fleet.

Maritime industries such as fisheries and shipping share the same waters and have to work side by side. Often they are subject to the same regulations. Changes made for the good of one should be beneficial in time for all seafaring industries, and this may explain why shipping is tackling marine conservation proactively. Unlike the problems of greenhouse gases and global warming, there has been a punctual reaction. Perhaps the problems caused by maritime industries are quicker and easier to fix. Of course, there is still a long road ahead. It will be hard to find a full solution but our industry must persist. We need to implement, develop and improve our efforts for the conservation of marine life.

Breakbulk WATERWORLD Photo Competition

Word has it that seaborne trade accounts for about 90% of the global trade. It’s a great choice of transport for any cargo that is an oversized and heavy load and travels a long distance. Despite all the GHG emissions, shipping is still more...

Port Focus: Mexican Ports

During last few years Mexican authorities have been working on the major port modernization program for Mexican ports to meet the increased demand for logistics and supply services. They are investing about 48 billion pesos ($3.2 billion) in the projects...

Imagination takes you everywhere

Logic will get you from A to B. Imagination will take you everywhere. - Albert Einstein As people, we differ a lot. Our personalities are built from various experiences. We might have different perspectives and interpret the same situations in different...

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Automation: Is it something to fear?

Automation: Is it something to fear?

Shipping terminals are embracing automation. Currently, 30 terminals around the world operate automated container handling services with other ports developing programmes to follow suit.

Stacking yards are the main area to receive a robotic upgrade as automated straddle cranes have phased into yards in Australia and New Zealand.  In some European ports both stacking yards and ship-to-shore loading is now automated. The cranes are controlled using software and are powered by electric batteries. This helps to fulfil zero-emission pledges and helps to keep running costs down.

It’s a very exciting prospect. As well as considerable savings, automation gives ports closer control over scheduling. More reliable cranes can operate at a constant pace and consequently reduce loading times. The software could be applied to a blockchain context, presenting exactly where the cargo is in the yard or vessel and show the expected schedule to the supply chain.

However, this all comes at a serious cost. Purchasing automated equipment costs ports millions, perhaps even billions. This could cut jobs in high salary countries as port owners realise the cost benefits.

The Port of Los Angeles estimated that automation will cut their workforce by 50%. These are astonishing figures and represents a contemporary worry. The Independent newspaper suggested a total of 30% of British jobs were threatened by automation and AI (artificial intelligence). Some envisage a dystopian future for Earth. A world of disposable humans, irreversible unemployment, wars against AI and people are seriously concerned.

In response to public fear, Silicon Valley has advocated for a universal basic income to offset mass redundancies and others suggest a heavy tax on robotics to finance it but this isn’t good enough.

This type of policy seems straight from the mind of Huxley or Orwell. These people are forgetting a job is a fundamental part of people’s well-being. It’s easy for tech companies to advocate universal income as their jobs seem secure.

But you can stop planning your Luddite resistance. The fear technology shall replace jobs is not new. For the shipping sector, containerisation was met with resistance with dockers unions conducting mass pickets and protests in Britain. The country’s logistical capabilities suffered because it was slow to accept the inevitable and by this time the world had moved on.

Automation is just another challenge for the industry. It’s an inevitable progression we must embrace, not fear. These machines are here to complement human skill not replace it. Automating the routine repetitive jobs enables us to face the gritty logistical problems that challenge us day to day. In our industry, human experience can’t be replaced because people make the real difference.

But if automation is to truly promise efficiency in the container shipping industry it must be multi-faceted. It is futile to spend billions on a brand new automated port when trucks still breakdown and there are queues outside of ports. Industry innovators need a wider scope. They must look right across the supply chain, not just one process, to make automation worthwhile.

Breakbulk WATERWORLD Photo Competition

Word has it that seaborne trade accounts for about 90% of the global trade. It’s a great choice of transport for any cargo that is an oversized and heavy load and travels a long distance. Despite all the GHG emissions, shipping is still more...

Port Focus: Mexican Ports

During last few years Mexican authorities have been working on the major port modernization program for Mexican ports to meet the increased demand for logistics and supply services. They are investing about 48 billion pesos ($3.2 billion) in the projects...

Imagination takes you everywhere

Logic will get you from A to B. Imagination will take you everywhere. - Albert Einstein As people, we differ a lot. Our personalities are built from various experiences. We might have different perspectives and interpret the same situations in different...

Finance for Forwarders?

Finance for Forwarders?

The UK’s export credit agency, UK Export Finance (UKEF) has pledged support to exporters and supply chain SMEs (small and medium sized enterprises) by accessing finance through their banks.

This scheme is set to provide thousands of businesses access to government backed finance. UKEF will provide working capital loans and bonds to SME customers and direct trade finance for suppliers who support exporters.

UKEF are working in partnership with five major high street banks (Barclays HSBC, Lloyds Banking Group, RBS/NatWest and Santander) to give companies access to the finance through their bank.

The Secretary of State for International Trade, Liam Fox commented:

“As an international economic department, this new partnership shows the Department for International Trade’s commitment to help small businesses seize the global demand for British exports. Providing easily accessible finance, backed by UKEF’s guarantee, will lift a common barrier to exporting. Providing finance to suppliers as well as exporters means spreading the benefits of global trade, supporting more jobs and growth for companies large and small.”

A new digital platform is being launched in conjunction with the scheme to ensure the quickest transactions.

The Head of Barclays Corporate Banking, John Mahon added:

“Delegated authority will make accessing UKEF guarantees simpler for many businesses and will help companies we work with grow more quickly. Both exporters and companies involved in international trade through supply chains will benefit, and we look forward to further collaborating with UKEF and our colleagues across the industry to find more new and innovative ways to help UK businesses take full advantage of export opportunities.”

UKEF has recognised the importance of supply chain SMEs and obviously wishes to strengthen its base. This becomes imperative as the UK heads into the political abyss once it leaves the European Union. But simply throwing money around is a cop out.

Indirectly investing through company banks is evidence of tunnel vision. UKEF can’t see the broader threats to industry and how a deregulated system can fail the public. The government must provide support with direct action and take responsibility for the export industry.

Providing support to major UK ports should be on the agenda. Ports are the gateway to the world and act as the foundations of international trade. But British ports are owned and ran by private companies. These companies often suffer from financial constraints meaning investment varies from port to port. Therefore establishing a registered body for ports will allow the government to personally ensure that British exports are handled well. UKEF could also promote new electric automated technology for increased efficiency in ports to benefit and stabilise export growth.

Additionally, the recent Petya cyber-attack highlights that stronger cyber-security is needed to sustain supply chains. Maersk is yet to return to full steam and suffered losses due to the attack. We can see the threat to a merchant fleet has evolved into a cyber-presence. The days of the Royal Navy protecting exports with gunboats are long gone. We must strengthen cyber-security and I would call on the government and UKEF to invest in cyber-defence development, especially with the scheme’s new digital format.

If the government wants stability in the future then it must solve the problems of today. It must guarantee the money invested will strengthen the supply chain for security in a post-Brexit society. The government has to develop a closer relationship with industry and not indirectly invest via banks.

Breakbulk WATERWORLD Photo Competition

Word has it that seaborne trade accounts for about 90% of the global trade. It’s a great choice of transport for any cargo that is an oversized and heavy load and travels a long distance. Despite all the GHG emissions, shipping is still more...

Port Focus: Mexican Ports

During last few years Mexican authorities have been working on the major port modernization program for Mexican ports to meet the increased demand for logistics and supply services. They are investing about 48 billion pesos ($3.2 billion) in the projects...

Imagination takes you everywhere

Logic will get you from A to B. Imagination will take you everywhere. - Albert Einstein As people, we differ a lot. Our personalities are built from various experiences. We might have different perspectives and interpret the same situations in different...

Subscribe to Our Updates

Sign up to Tuscor Lloyds monthly newsletter and be the first to hear about news and offers as they are released and gain access to our latest project case studies!

Mergers: Read between the Shipping Lines

Mergers: Read between the Shipping Lines

Since deregulation in the 1990s, our industry has witnessed many mergers and there are rumours endlessly flowing about the next big acquisition. The market looks like it’s narrowing until only a handful of shipping lines, and a handful of countries, are competing for control.

The recent deal for Cosco to buy OOCL shows intent for the biggest market share. The $6.3 billion deal hopes to achieve “synergies”- this word appearing in merger press releases all too often. But shouldn’t synergies already be in place considering Cosco and OOCL make up one-half of Ocean Alliance?

This alliance is a 10-year vessel and slot sharing agreement between the French carrier CMA CGM, the Chinese state-backed Cosco, the Hong Kong line OOCL and the Taiwanese Evergreen Line. When Ocean was initiated in April 2017, CMA CGM was its biggest player contributing over 30% TEU capacity on the alliance’s trade routes.

But this changes as Cosco’s global TEU figure overtakes CMA CGM’s with the OOCL purchase. Some have cited political motivations, not synergies, behind the recent acquisition as China attempts to grow its international influence.

China plays the leading role on the global trade stage. It manufactures up to 20% of the world’s consumer products and China believes it should dictate how the theatre is run but they have to get around the European theatre directors first.

The OOCL buyout comfortably places Cosco as the world’s 3rd biggest line based on TEU capacity but Cosco’s goal is to beat European dominance in the industry. So rumours of a Cosco bid for 24% of CMA CGM has made Western shipping lines uneasy.

The raised tensions between shipping lines are playing out in international politics, as Olaf Merk suggests:

“Provided that the acquisitions of OOCL and Evergreen work out, buying only part of CMA CGM (say 24%) would help pushing COSCO beyond the reach of Maersk and make it world’s largest carrier…Over the coming months the Chinese will no doubt test the resolve of the French to block sales of CMA CGM shares to China. The French state might even consider to buy shares in CMA CGM to pre-empt the Chinese from doing so, which might be a logical consequence of the French discussion this year on what constitutes a strategic merchant fleet.”

What Merk highlights seem a trending point. The Japanese companies K-Line, MOL and NYK merging into ONE (Ocean Network Express) was blocked by the South African Competition Commission. They cited the previous collusion from the shipping lines, saying the deal could have anti-competitive effects.

ONE, who will take bookings from April next year, will become the 6th largest liner, with a TEU capacity that puts pressure on their THE Alliance colleagues, Hapag-Lloyd, who takes 5th place.

Don’t tell me that’s anti-competitive. The South African rejection of ONE highlights the West’s fear of an eastern influence which slowly trickles to the top of the freight industry, thus into the strategic control over global trade.

Both the Chinese President, Xi Jinping and the Japanese Prime Minister, Shinzo Abe envision their countries as export-based powerhouses and influential states in the international forum. To do that they must beat the current Western powerhouses. So Eastern shipping lines look to buy European competition to gain control of trade lanes and have a positive effect on Chinese and Japanese economies. Then the East will really challenge the current reign of Western power.

Only time will tell if the East can succeed.

Breakbulk WATERWORLD Photo Competition

Word has it that seaborne trade accounts for about 90% of the global trade. It’s a great choice of transport for any cargo that is an oversized and heavy load and travels a long distance. Despite all the GHG emissions, shipping is still more...

Port Focus: Mexican Ports

During last few years Mexican authorities have been working on the major port modernization program for Mexican ports to meet the increased demand for logistics and supply services. They are investing about 48 billion pesos ($3.2 billion) in the projects...

Imagination takes you everywhere

Logic will get you from A to B. Imagination will take you everywhere. - Albert Einstein As people, we differ a lot. Our personalities are built from various experiences. We might have different perspectives and interpret the same situations in different...

Subscribe to Our Updates

Sign up to Tuscor Lloyds monthly newsletter and be the first to hear about news and offers as they are released and gain access to our latest project case studies!

Zero Emissions: Are we any closer?

Zero Emissions: Are we any closer?

The logistics industry must achieve zero emissions. If we continue to burn the 4 billion tonnes of crude oil we go through every year, then all known oil deposits will be gone by 2050. But the question of what shape the industry takes after fossil fuels still lingers despite the answer being in everyone’s best interest.

Carbon emissions are destructive to the Earth, and the supply chain is partly accountable for releasing them. The global logistics industry contributes a combined 4% of the world’s carbon emissions a year, yet was not formally cited in the Paris Agreement (PA) on climate change. Instead, the PA tasked the ICAO (International Civil Aviation Organisation) and the IMO (International Maritime Organisation) to regulate in accordance with the 2°C by 2020 target.

So, what are the ICAO and IMO doing?

The ICAO proposes levies, emissions trading and offsetting with CORSIA (Carbon Offsetting and Reduction Scheme). Airlines can implement the scheme according to their business’s needs. Over 80% of the international aviation community already intend to participate in CORSIA, which comes into action in 2020.

Whilst the IMO proposed an initial roadmap which runs from 2018 to 2023, after which a revised strategy is implemented. The plan includes mandatory data collection of fuel oil consumption, a global sulphur cap by 2020 and further GHG (Greenhouse Gases) studies.

Although these steps should be welcomed, carbon-emitting fuels are still being burnt. Alternative energy solutions must be found for the sake of environmental protection and international trade. Long-term alternatives must come to the forefront of the ICAO’s and IMO’s mind, not the short term observations they propose. Consequently, the private sector has become the driver for enduring green innovation.

The answer seems simple in some areas; electrification. We have hybrid and fully electric cars and trucks on our roads on a commercial scale and such technology can move into container handling equipment.

This is becoming the case with Hyster’s recent announcement of an electric container truck, capable of carrying 48-tonne loads. Though only in early stages of development, it’s a step in the right direction.

Ports have to lower their GHG emissions and swapping diesel vehicles is the place to start and despite Trump’s decision to exit the PA, some American ports continue to pursue zero emission promises. Los Angeles and Long Beach ports have aimed for this by 2035. The renovations include a fully automated electric gantry and new adjacent rail line to eliminate thousands of truck journeys thus eliminating emission.

Air freight is also becoming greener. The JKIA (Jomo Kenyatta International Airport) cargo facility recently began using renewable energy to power their cold stores, cutting the terminal’s energy bill by 33%. There is also space for swapping diesel engine vehicles for electric power in air terminals.

But the biggest long-term goal has to be zero emissions from vessels and aircraft.

For maritime travel, this end may be close. MOL’s fleet includes Emerald Ace, a hybrid car carrier using solar panels and lithium-ion batteries, the only operational ship of this kind. When in berth the ship uses its stored solar energy to power the electricity on board as opposed to a diesel generator. This is an exciting development albeit a small one as the vessel still uses its diesel engine in transit.

 

Although, expect a fully electric container cargo ship by late 2018. The chemical company YARA plans to launch YARA Birkeland, the zero emission vessel which will haul between their Norwegian production plant and the cities of Brevik and Larvik. This will replace 40000 truck journeys needed every year for the company’s haulage. Birkeland’s service will only be small voyages, exclusive to YARA but will act as a rehearsal for further electric nautical development. The industry shall eagerly observe the vessel and if it proves successful, we shall certainly witness a movement towards electrification.

Greener aviation is not as developed as the maritime sector but there is movement from passenger aircraft companies. EasyJet unveiled a hydrogen aircraft concept in early 2016. It uses the energy from the aircraft’s breaks and stores it in hydrogen cells. The cells will power the aircraft’s taxi to the runway and the electronics when grounded, estimating to save EasyJet up to £27 million in fuel. No information has emerged regarding tests since the concept was revealed.

On the other hand, the Dutch airline KLM has made a significant development as they started operating biofuel flights out of Los Angeles and Oslo in 2016. The biofuel is produced from plant oils and agricultural waste and has a 70% reduction of CO2 emissions compared to kerosene.

This may suggest biofuels are the best alternative for aviation because they are already operating and proving successful, but these flights are not completely running off biofuels. They use a ‘drop-in’ technique; a mixture of 50% biofuel and 50% conventional kerosene fuel, so the aircraft does not need to undertake modifications to accept the biofuel.

Drop in‘ fuel used on KLM biofuel flights:

%

Biofuel

%

Kerosene

These are important steps towards sustainability but as a whole, the industry has fallen behind. It is imperative to reduce carbon emissions yet we continue to burn away. But developing alternatives is a serious cost. Currently, biofuel is 3 times the price of kerosene and it was recently revealed that the Long Beach renovations will cost £1 billion. But it’s the private sector who are the driving forces behind better efficiencies and current financial pressures on logistics providers make research and development nearly impossible.

The ICAO and the IMO look to reduce emissions but fear investment. It has fallen on the brave few companies to invest heavy sums into new technology. But these high prices will fall once the supply chain realises its responsibility. Ports, liners, fuel companies and vehicle manufacturers, both sea and air alike, must make zero emission commitments to stimulate a competitive market and achieve long-term sustainability goals.

But we must also see the ICAO and IMO take up some of the slack. We, therefore, welcome the inauguration of the GIA (Global Industry Alliance). The 13 company alliance who will work with the IMO to develop and implement zero emission solutions right across the maritime industry.

We also advocate the CBP (Corporate Biofuel Programme) initiated by KLM to sustain and develop their biofuel operations. Once again it has been the private sector investment as the major contributors to this programme and a public/private bridge must be constructed with this programme, or similar synergies, to develop better efficiencies in aviation.

Port Focus: Mexican Ports

During last few years Mexican authorities have been working on the major port modernization program for Mexican ports to meet the increased demand for logistics and supply services. They are investing about 48 billion pesos ($3.2 billion) in the projects...

Not so objective 2017 review

We’d like to talk about the topics that have touched the shipping industry the most, inspired vibrant discussions and made us feel more human during 2017.

Subscribe to Our Updates

Sign up to Tuscor Lloyds monthly newsletter and be the first to hear about news and offers as they are released and gain access to our latest project case studies!