14th May 2007

The Star Maritime

Ports must strategise

Ports must not make unnecessary investments just to cater to the increasing ship size, according to Malaysian International Chamber of Commerce of Commerce and Industry executive director Stewart J. Forbes.
 
Ship owners are keen to build larger vessels to achieve higher eco- nomies of scale. The world's largest container ship, the Emma Maersk, with capacity of 11,000 TEUs (20-ft equivalent units), began its maiden voyage in September last year.
 
Perhaps in another 10 years or less, the much anticipated 18,000-TEU Post-Suez-max or Post-Malacca-max ships will be launched.
 
To accommodate vessels of such size, ports are catching up through dredging projects, expansion of wharves, acquisition of cranes and acquisition of yard facilities.
 
Forbes argued that ports must not jump onto the bandwagon and do unnecessary expansion as the ships might still not call at their ports.
 
“One of the first container ships brought to Malaysia was a 3,000-TEU vessel with a crew of 35 to 40. But now, the Emma Maersk can be manned by only 13 crewmen.
 
“Thus the cost of moving these containers can be dramatically lowered with bigger capacity ships,” he said.
 
He noted that there were already 150 ships of more than 8,000 TEUs in the sea trade.
 
However, he said, the idea of welcoming a Post Malacca-max of 18, 000 TEUs and 21-metre draft could be impeded by geographical limitations.
 
“Perhaps by 2020, there will be vessels of such size that cannot go through the Straits of Malacca. So ports must strategise and not put all their eggs in one basket,” he said.
 
Citing Northport (M) Bhd as an example, he said the port did not only focus on catering to bigger vessels but also developed other businesses like the distripark, halal hub, conventional cargo and trades with smaller vessels for regional distribution.
 
“New quay cranes, expansion of container yard and dredging are expensive, but it is up to the individual port to decide,” he said.
 
According to Arthur D. Little Malaysia senior adviser Antonie Versluis, what determines the size of new buildings is the type and trend of facilitation (facilities and special treatment) in a particular trade at the ports.
 
“To hub vessels of more than 10,000 TEUs, a port most likely has to handle 4,000 to 5,000 TEUs on and off the carrier at that particular location.
 
“A port operator has to change the yard system entirely and it is hard to manage that amount of TEUs at any one time efficiently.
 
“Personally, I do not know who is ready to do that, but there are ports dominated by Maersk that are actually catering to these ultra-size ships,” he said, adding that currently, most of the ultra-size vessels were ordered by the Danish shipping line.
 
Versluis concluded that it remained a mystery whether this was going to be a continuing trend.
 
Nevertheless, he warned that the rush to build ultra-size ships could end up being a fatal mistake, as seen with the crude oil tankers.
 
At one point, crude oil tankers reached to 500, 000 deadweight tonnes (dwt) in capacity, but today there is not a single tanker exceeding 350,000 dwt in the ocean.
 
Another factor limiting the growth of container ship size, said Baltic Maritime Adviser president Prof Hans J.F. Peters, was the container itself.
 
“We have to consider the stacking capacity, as the bottom containers can be crushed if the upper ones are too heavy. To avoid this, ships must grow wider and longer or the containers must be redesigned.
 
“This is not likely to happen as it will be very costly and certain shipping lanes can only accommodate up to a particular size of vessel,” he explained.
 
The size of quay cranes would also have to be modified to get a wider outreach, and this would not be cost-effective, he said.
 
The largest crane now is the super post-Panamax quay cranes, which have a 22-box outreach capacity.
 
Before any expansion plan is made, ports must consider their geographical limitations, trade routes, investment capacity, cost-benefit analysis and multi-faceted ports services.

 
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