I was interested to note an article last month wherein California based Navis unveiled its leading predictions and trends that will drive the shipping industry in 2021.
For those unfamiliar, Navis is a subsidiary of Cargotec Corporation and has carved out a considerable niche in the development and supply of advanced container terminal operating systems across the globe. The predictions were as follows:
Events of historical significance for the globe occur every year but of course some years are etched in memory. The most memorable years often relate to the outbreak or end of global conflicts or for example the first man to walk on the moon or the fall of the Berlin wall. The year 2020 will forever be synonymous with the devastation of the global economy generated by COVID 19 and the tragic number of lives prematurely lost. When the pandemic is eventually in the rearview mirror it will be an opportunity for every country to objectively reflect on their preparedness and how they responded to the challenges represented by a virus which highlighted examples of strong leadership but also examples of significant political failure to lead when it most mattered.
The scrapping of a number of older cruise ships has been much in the maritime media since the onset of the global pandemic effectively shuttered the cruise industry. However, a headline that caught my eye a couple of weeks ago was that it is 500 days since the last Very Large Crude Carrier (VLCC) was sold to a scrapyard. There are a number of reasons for this, primarily that until very recently VLCCs have been making strong returns, but also the uncertainty generated by IMO emission reduction targets. Just to remind you these are to reduce total emissions from shipping by 50% in 2050, and to reduce the average carbon intensity by 40% in 2030 and 70% in 2050, compared to 2008.
Ships are registered in the country of an owner’s choice and the options are many. Traditionally a shipowner would register his ships in his country of business identity as a matter of national pride. As recently as the 1960’s this resulted in close to half of the world’s merchant fleet being registered in the UK as a direct reflection of where the fleet was controlled. However, in the last half-century, national ship registration has declined in favour of a number of “Open Registries” which incentivize third-party ship registration. The most popular of these are Panama, Liberia, Marshall Islands, Hong Kong, and Singapore.
Normally I limit my articles to sharing facts but this month I will also share my thoughts on a serious issue – that of marine casualties.
This past month has seen a maritime casualty which any seafarer worth his or her salt knows full well should not have occurred, namely the grounding of the Japanese owned Cape size bulk carrier M.V. Wakashio off Mauritius with significant environmental consequences and loss of the ship itself. Let’s not beat around the bush, given today’s navigation aids, this occurrence was inexcusable gross negligence.
In normal times. the rate at which differing sectors of the shipping industry elects to sell or scrap ships is largely determined by freight markets or regulatory design and environmental changes and whether it makes economic sense to continue trading an aging vessel. In the COVID era we are seeing a new dimension in the decision of some cruise lines to sell or scrap ships which would normally have been expected to trade for several more years.