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.

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Blockchain – Revolutionizing Shipping

Blockchain – Revolutionizing Shipping

The Maritime industry is entering a new generation of technological advances. Whether that be environmental, transportation or digital. Things are about to change.

A term that has come up a lot in recent months has been ‘Blockchain’. But when I talk to people about this ground-breaking technology, that promises to revolutionize container logistics, not many people understand it.

So, what is it?

Blockchain’s store information across a network of personal computers making them not just decentralised but distributed. This means no central company or person owns the system but everyone can use it and help run it. This makes it very difficult for it to be . The people who run the system use their computer to hold bundles of ‘blocks’ (records) that can be submitted to others in a chronological chain. The blockchain uses a form of math called cryptography to ensure records can’t be counterfeited. Old transactions are preserved forever and new transactions are irreversible once added.

The blockchain is best known as the underlying foundation for the crypto-currency, Bitcoin. Digital cash you can send to anyone, this is different to normal money as there isn’t a financial middleman involved. Instead, people from all over the world help move the digital money by validating others bitcoin transactions with their personal computers.

Bitcoin uses blockchain by tracking records of ownership over the digital money, so only one person can be the owner at a time. The money can’t be spent twice like counterfeit money in the physical world can. Bitcoin is just the beginning, in the future, blockchains that manage and verify online data could enable us to launch companies that are entirely run by algorithms. This would help us protect our online identities and even track the billions of devices on the internet of things. These innovations will change our lives forever and it’s all just the beginning.

How will this relate to shipping?

Container logistics is a £3 trillion a year industry, using various IT systems and massive amounts of data-entry-type paperwork. Maersk and IBM have teamed up to start using blockchain to track its cargo. For Maersk, it gives buyers, sellers and customers an official way to keep track of the goods it hauls. Everyone involved can see where the shipment is at any point. Shipping crosstrade can have up to 30 people involved, having 200 separate interactions that all require different sets of documents.

 

1 Shipment:

People Involved

 

Separate Interactions

This is usually done by countless emails, phone calls and sometimes even fax. Blockchain will allow customs officials to upload a copy of a signed document (approving the transaction/shipment) where everyone can see it. This could save up to £230 per container in terms of the labour that process documents. So, an Ultra Large Container ship that can carry 18,000 containers, could mean the savings for one ship’s full cargo would amount to £4.4 million.

The great thing about Blockchain is that no one needs permission to implement it into their business. But everyone involved would have to be ‘on board’ with the technology for it to work effectively. With a wide lack of understanding still present, this could take years to implement.

 

Breakbulk WATERWORLD Photo Competition

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Petya: Black Cyber Swans Breaking the Chain

Petya: Black Cyber Swans Breaking the Chain

The industry suffered as Maersk fell victim to the Petya ransomware attack, one of the biggest Black Swan events our industry has seen. The business analysis, Nassim Nicholas Taleb coined his Black Swan theory to describe a high profile unforeseeable event which has great industry-wide consequences.

Typically Black Swan events occur out of sheer chance. Natural disaster, illness, and accident are common contributors.

The Philips Albuquerque semiconductor plant fire in 2000 is a prime example. The factory was the supplier for the Swedish phone company Ericsson and their Finnish competitor Nokia.

During a storm, a small fire broke in a furnace when cooling fans failed after being struck by lightning. Within a matter of minutes, the fire was extinguished. The damage seemed minor and everything was expected to be running as usual in a few days. Ericsson merely waited for production to restart.

But, the fire contaminated the plant to a further extent than originally thought and production halted for months, leaving Ericsson with a parts shortage and desperately trying to rectify their supply chain. But their chain was too lean. They had no plan B and were subsequently unable to launch their new headsets and suffered huge losses.

Compare this to Nokia, who had a wider supply chain and closely observed Philips so they were well accounted for. They implemented their plan B and suffered significantly less than their competition.

Losses after a Black Swan event are common. A Professor of Operations Management at Georgia Institute of Technology, Vinod Singhal, investigated the effects of breakdowns and found within two days after a breakdown shares can drop by an average of 8%.

Historically, unpredictable events can be controlled with close management of supply chains, just as Nokia understood. But Black Swans have evolved into a new form and in the light of Petya, there is cause for concern.

Maersk’s efforts to increase their cyber security were made worthless. They pledged resources and appointed a CISO (Chief Information Security Officer) and it’s frightening that such extensive efforts have proved so ineffective. It’s obvious that basic firewalls and anti-virus software, the extent of many company’s defenses, are simply not enough and cyber-attacks are a looming threat to the industry.

So how do we cope? Black Swans are now cyber, yet the threat the same.

Cross-industry communication is needed. Because this problem threatens all, we must see a co-operative effort to control it and extending MSC’s support to Maersk is a starting point. The two shared “vessel byplans, load lists, and customs information” in the wake of the event in order to control the damages. Now order is restored, sharing resources is important to maintain this order. Strengthening passwords, two step verification and an investigation into the attack is another place to begin. But this still isn’t enough. A complete industry-wide initiative is vital to even begin preventing this modern threat.

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Stad Ship Tunnel – Worlds First Ship Tunnel

Stad Ship Tunnel – Worlds First Ship Tunnel

A newspaper article in 1874 was the kick start to a century-long debate which at some point in 2018, will finally start to become a reality. 

The Coalition parties in Norway have taken the historic step to push the ‘start’ button on building the world’s first ship tunnel.

Norway is already home to the world’s longest tunnel, spanning over 15miles, the Laerdal was built in 4 sections through 3 caverns. It’s been lit in a way that simulates dawn, with the basic concept that it will help drivers to stay awake. The Laerdal is already a massive tourist attraction and the minds at Norwegian Coastal Administration are hoping for the Stad Ship Tunnel to be the next Laerdal!

As beautiful as the coastline of Norway is, it’s also very dangerous. With the largest number of fjords spanning its 29,000 Km coastline, along with some of the stormiest seas anywhere on the planet, the Stad tunnel will literally be lifesaving. Over 33 lives have been taken by the waters around the Stad Peninsula since the Second World War.

An illustration of the Stad Ship Tunnel. Image credit: Norwegian Coastal Administration
An illustration of the Stad Ship Tunnel. Image credit: Norwegian Coastal Administration

This tunnel will mean that freight and passenger ships, carrying up to 16000 tons, won’t have to navigate those treacherous waters, and instead can breeze through just 1.7 Km of steady waters, passing under 645 meters of the mountain.

 

But, how is this historic tunnel going to be made?

The current plans laid out is that underground drilling rigs and pallet rigs will be used to help blast through a mile of solid rock. It’s estimated to cost around £260 Million and the project will expand over a decade. This is going to be time and money well-spent. The development will connect the Norwegian Sea to the North Sea, which is practical and could potentially be time-saving compared to the current route used. This is not the focus of why this is going ahead however, the Bergen-based Tidende Newspaper reported that the key aspect is creating a safe passage from Bergen to Alesund.

 

Location of the Stad Ship Tunnel (in yellow). Credit: Norwegian Coastal Administration

So many parts of life are based on practicality, expense and time. It’s wonderful to hear of an expansion that has people at the heart of the motivation.

Location of the Stad Ship Tunnel (in yellow). Credit: Norwegian Coastal Administration
Shipping Emissions – Finally on Board?

Shipping Emissions – Finally on Board?

90% of global trade travels by sea. Without international shipping, the modern world would not be able to exchange goods at the level it currently does. Over the past few months there has been increasing reports of the IMO stepping up their road map to control shipping emissions, as well as large scale investments from the EU towards the sustainable future of our maritime industries. We take a look at just some of the initiatives aiming to make waves in shipping’s sustainability.

IMO AND MEPC

During the 70th session of Marine Environment Protection Committee (MEPC) meeting, the International Maritime Organisation (IMO) walked away with clear aims.

  • A Global Sulphur Cap by 2020
  • Road mapping to reduce Greenhouse Gas Emissions
  • Mandatory data collection system for Fuel Oil Consumption
  • New protected territories
  • New guidelines for Ballast Water Management
Violeta Bulc, European Commissioner for Transport said: “The maritime sector must play its part in tackling climate change. In the near future, ships will have to emit less sulphur and efforts to cut CO2 emissions have been stepped up. This will require immediate investment.”

1st January 2020 has been set as the deadline for companies to implement reduced sulphur content in fuel oil used on board. The global sulphur cap will stand at 0.50% m/m (mass/mass), cut from the 3.5% m/m global limit currently in place. Ships will be able to meet the new requirement by using low-sulphur compliant fuel oil, such as liquefied natural gas (LNG) or methanol, or by fitting exhaust gas cleaning systems, commonly known as “scrubbers”, which strip the pollutants from the emissions before they are released into the atmosphere.

 

Under the roadmap, which will run from 2017 through to 2023, MEPC is tasked with sorting out the role of the international shipping sector in supporting the goals of the Paris Agreement (the Paris climate change deal aims to curb emissions to levels that would prevent the world temperature from rising more than 2 degrees Celsius).

The plan so far includes a ‘to-do’ list containing tasks like further greenhouse gas (GHG) studies. Basically, MEPC are going to decide if ‘technical and operational measures’ are going to work well enough to meet IMO’s CO2 reduction commitments – so far they have reduced this by 10%.

MARPOL Annex VI

Another measure taken has been the introduction of the data collection system (MARPOL Annex VI). This will require ships to record and report on their fuel oil consumption. The data will be collected and reported to the Flag State at the end of each year, when the ships will then receive a Statement of Compliance (as long as the ship passes). This will come into effect on the 1st of March 2018.

MEPC have also ruled in favour of making the North Sea and Baltic Sea Emissions Controlled Areas (ECA’s) for nitrous oxides (NOx). Starting January 2021 Marine Diesel Engines passing through the North Sea or Baltic Sea will have to comply with the Tier III NOx emission limit.

The IMO are doing their best to add areas of our seas to the list of Particularly Sensitive Sea Areas (PSSA). One of the new additions is the Jomard Entrance in Papua. It has joined the list of outstanding beauty and great environmental significance which is what the PSSA is there to protect.

All of these measures are clearly a step in the right direction for shipping’s sustainable future but with time ticking, targets set 4 years away and the alarming rate of global warming you can argue that this is all a little too late.

 

Author Info


 

Rachel Finch

Rachel Finch

Marketing Assistant

Rachel is a new addition to the family. She’s already been making waves on our social media platforms and learning more everyday about the complexities of our industry. Yoga obsessed – she should be flexible enough to do the job!

Tuscor Lloyds at Thinking Digital Manchester

Tuscor Lloyds at Thinking Digital Manchester

Tuscor Lloyds communications team have returned from a fruitful day at Thinking Digital, held at HOME in Manchester’s City Centre.

Thinking digital describes the event as,

“a gripping, communal journey for those curious about “what’s next?” Our gatherings combine the world-class quality of an international conference with the warmth of a great community event.”

It was a great opportunity to delve into the imminent changes posed by the digital world, with some fantastic, inspirational talks. The agenda took us on a journey to the future, from rise of the new digital ledger blockchain to experiments in kick-starter funded virtual reality projects.

Not only did the day highlight new exciting technologies, but also took the time to stop and ask the question how well it integrates with our lives, and how we merge our digital and physical worlds harmoniously.

One of our favourite talks was from ‘Cybernetic Anthropologist’ Amber Case, who asked the question ‘how is our relationship with computers changing the way we think and act?’ You can check out her TED talk below:

This really resonated with our team as the shipping industry looks at increasing automation, large scale systems and faceless encounters replacing basic human contact. If anything it made us realise the importance of our people as the cornerstone of everything we do at Tuscor Lloyds.

Technology is not always the answer to an easier life, and often submitting your organisation to the wills of tech can only complicate a simple process. As Amber Case surmised, “The right amount of technology is the minimum amount to solve the problem.”

At Tuscor Lloyds we are committed to researching new technology that may improve customer supply chains. Watch this space! For picture from the event check out our gallery below!

And just for a bit of fun we thought everyone should take 5 and check out this hilarious post from Hubspot, on the 15 types of people you’ll meet at a conference. Our team definitely came across a few of these characters yesterday!