Oral presentation-ULCVs and their impacts on Container ports

Ultra-Large Container Vessels and their Impact on Container Ports

By: Dr. Hamid Reza Abaie,

General Director of ICT Department, [email protected]

Mehdi RastegaryHead of R&D, Sina Ports and Marine Services

[email protected]

rcopg15-01990184 کد مقاله:

mailto:[email protected]



�مره �جري� الفلك فيه بأ �حر� لت �كم الب ذي سخر� ل ه ال الل�شكرون� كم ت �ع�ل �غوا من ف�ضله و�ل �بت ( 12 )الجاثیه-و�لت Allah hath made the ships subject to you, that they may

sail through the sea by his command; and seek your livelihood from his mercy, and you should be thankful

towards him.

By : Dr. H.R. Abaie & M. Rastegary p.: 3Tehran – 28th February 2016

Ultra-Large Container Vessels and their Impact on Container PortsEmergence of Mega-ships

• Container ships are the workhorses of global economy.

• They have seen tremendous growth in size within the past 60 years.

• For instance in comparison between MV Ideal X (1956) and M.V. MSC Oscar (2015), we may find:

1200% growth in size and 20,000% increase in

capacity



Emergence of Mega-ships (Continue)

• The size growth trend has been mainly fueled by economy of scale.

• Yet, many other contributing drivers have boosted this trend, including:

Improving Competitiveness of fleets

Commoditization of shipping services

Available financingLow new-build pricesTotal inelastic demands Fleet demand misrepresentationsetc.

Emergence of Container Ships Generations between 1970-2020Increased Percentage in Draft

(m)Beam (m)

Rows on Deck TEU/m LOA

(m)Capacity (TEU)

Cycle (years) Title Year

Draft Beam LOA Capacity

10/8 30 11 10 239 2400 Fully Cellular 1974

11 8 12 50 12 32/3 13 13/5 267 3600 7 Panamax 1981

8 0 10 33 13 32/3 13 16/3 294 4800 7 Panamax-Max 1985

8 33 8 38 14 42/9 17 20/8 318 6600 7Post-Panamax Plus

1995

7 0 11 32 15 42/9 17 24/8 352 8724 6 2001

7 32 13 78 16 56/5 22 39 397 15500 5 New Post-Panamax 2006

3 4 1 16 16/5 59 23 45 400 18000 7 Malacca-max 2013

3 10 14 33 17 65 25 52/6 456 24000 7 2020

Source: Lane & Moret (2015)





Source : Ashar & Rodrigue (2012)Changes in Size of Container Ships between 1974-2020

239

267

294

318

352

397

400

456

30

32/3

32/3

42/9

42/9

56/5

59

65

10/8

12

13

14

15

16

16/5

17

2400

3600

4800

6600

8724

15500

18000

24000

Ship

Cap

acity

(TEU

)

Draft (m) Beam (m) LOA (m)

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

4,000,000

4,500,000

656,

524

1,57

2,07

2

2,27

8,54

2

3,98

5,03

2

3,14

8,66

0

3,33

5,11

8

908,

010

1,63

9,59

9

992,

755

807,

604

556,

171

57,9

78

907,

354

1,87

6,10

8

2,57

2,49

2

4,29

1,43

7

3,15

5,54

2

3,34

3,11

8

933,

188

1,71

9,22

0

1,05

0,80

4

828,

551

557,

314

57,9

78

1,41

1,64

2

2,14

3,10

8

2,87

9,17

2

4,31

0,23

7

3,19

0,75

2

3,35

9,11

8

973,

588

1,79

6,97

3

1,08

6,85

2

852,

751

557,

314

57,9

78

1,96

7,45

0 2,33

9,95

8

3,08

1,57

2

4,31

0,23

7

3,22

2,52

2

3,35

9,11

8

995,

988

1,84

6,90

9

1,11

7,08

0

862,

171

557,

314

57,9

78

2,09

7,75

0

2,36

7,95

8

3,10

5,17

2

4,31

0,23

7

3,23

3,11

2

3,35

9,11

8

995,

988

1,85

5,30

9

1,11

7,08

0

862,

171

557,

314

57,9

78

211.43 51.38 37.31 7.71 2.94 0.82 9.16 12.96 12.05 6.61 0.27

0

Dec. 2015

Dec. 2016 Estimate

Dec. 2017 Estimate

Dec. 2018 Estimate

Dec. 2019 Estimate

Growth in Number between 2015-2019 (%)

Ship Capacity Category ( TEU)

Proj

ecte

d C

apac

ity (

TEU

)



33.17 % of Existing Capacity of Ships in 2020

Based on published data by Alphaliner( Feb.2016)



10.16 % of Existing Number of Ships in 2020

Based on published data by Alphaliner( Feb.2016)



Container Ships Container Ports

Pioneering in transformation and change towards improvement

Trying to be pursuant and adaptive to transformations and changes in Shipping

Continuous Innovation and Improvements in dominant designs

Nearly no innovation in dominant design

Less Time-consuming and Capital-intensive More Time-Consuming and Capital-intensive

Operability with 100 percent of full capacity Operability with 60-70 percent of full capacity

Proactive in achieving her interests (economy of scale, load factor, etc.)

Mainly reactive to Shipping market trends

Much organized competition and cooperation in terms of alliances and consortia

Less organized competition and cooperation in terms of newly introduced 4rth generation ports

Container Ports Vs. Container ships






Ultra-Large Container Vessels and their Impact on Container PortsRedefining Hub-and-spoke

• Mega-ships will strengthen the hub-and-spoke mode of operations in Shipping industry.

• With hundreds of Ultra-Large Container Vessels in the market, ports are struggling to remain competitive by facilitating the new normal.

• Only few ports in different regions of the world will be recognized as hubs.

• Other ports should compete to position themselves in lower ranks of this hierarchy as:

Regional Pivots Pivots Feeder ports

Cascade Effect

• By arrival of the new behemoths into the shipping market, the former giant box-ships will be shifted to smaller ports or secondary routes.

• In comparison to major ports, the tension on smaller ports will be even more fierce.

• O.Merk(2015) depicts between 54 to 79% ship size growth in main maritime trade lanes between 2007-2014.

• This means ‘Arrival of Bigger , Growing Ships in Smaller Ports’ which is getting aggravated with much faster pace in terms of introduction of new megaships to shipping market.

• According to N.Davidson (2014), the average ship size growth will be between 21-37% on the East-West trade lanes, and 47-73% in the secondary North-South trade lanes.



By : Dr. Hamid Reza Abaie & M. Rastegary p.: 14Tehran – 28th February 2016

Ultra-Large Container Vessels and their Impact on Container PortsValue of the Ships and Their Shipments

• The bigger the container ship gets, the higher soars the value of her shipment

• For instance, the value of cargo carried in an 18000 TEU (7th gen.) ship is estimated to be 28.57% more than the value of cargo in a 14000 TEU (6th gen.) ship, and 125% more than a 8000 TEU (5th gen.) ship.

• Likewise the value of the mentioned 7th gen. ship (190 MM USD) is 55.5% more than the 6th gen. ship (122.2 Million USD) and more than twice the 5th gen. ship.

• Accordingly the CAPEX, TCO, and OPEX of ship for her owners and operators, and the Value of cargo for its owners have soared.

384/00

336/00

307/84

304/00

288/00

224/00

200/00

160/00

144/00

128/00

112/00

68/00

24000

21000

19240

19000

18000

14000

12500

10000

9000

8000

7000

4250

Ship

Cap

acity

(TEU

)

Value of container Cargo in a Container Ship (Million USD)-Assuming 80% fullcontaimers in the ship

Scenarios for Port Operations of Generations of Container Ships

% in Ports

Port Days

QC MPH

Meters/QC

Moves/QC

QCs

Increase

Moves/m

Moves/

PortPorts

Moves /Rotatio

nLOA (m)

Capacity (TEU) Year

6 3/4 28 79/7 252 3 3/2 757 9 6813 239 2400 19748 4/3 28 76/3 324 3/5 34 4/3 1737 9 10219 267 3600 198110 5/3 28 77/4 326 3/8 -1 4/2 1239 11 13626 294 4800 198512 6/6 28 75/7 406 4/2 27 5/4 1703 11 18735 318 6600 199510 7/9 28 78/2 485 4/5 16 6/2 2181 11 23991 352 8724 200114 10/6 28 66/2 646 6 58 9/8 3875 11 42625 397 15500 200615 11/3 28 61/5 692 6/5 15 11/3 4500 11 49500 400 18000 201318 14 28 65/1 857 7 17 13/2 6000 11 66000 456 24000 2020

A.Lane & J.Morret (2014)





Marine Operations in Ports

• Marine Operation of Bulky, and expensive megaships is a very critical process.

• Normally marine operations account for more than 30 percent of vessel turnaround time in port.

• The marine operations will become far much risky and slower for megaships.

• It will require sufficient depth and width in the access channel.

• The tolerance for any error is strictly diminished.• Facilitating the port with the needed width and depth

will require a lot of time, and incur great financial and external costs.

55%30%

5%

10%

Container Vessel Turnaround Time

Cargo transfer time

Vessel arrival to time to mooring

Time of mooring to time of first transfer

Last transfer to time of departure

Source : Cirrus Logistics (2014)

CSCL Indian Ocean grounded in Elbe river(Feb. 2016)



Lane & Moret ( 2015)

Berth Wastage

• As indicated in the exhibit, in Berthing of gen. 7 and gen.6 ships, a significant length of quay will be left idle.

• This will reduce the efficiency of quay line as the most expensive resource of ports.

• It also restricts the maneuvering and arrangement of Quay Cranes both on the mega-ship and in the entire quay-line.

• In this way, Mega-ships have altered the pattern of berth utilization towards diseconomy in ports.

Workload Peaks and Troughs: Resource Management

• In terms of Vessel Operations, the workload of container terminal reaches its peak when the vessel is moored and its unloading is begun.

• The workload is smoothed as operations continue, and it ceases into troughs when the vessel operations nears to its end.

• As the volume of operations in megaships is very high, the peaks and troughs vary broadly form each other.

• This makes the resource normalization process very hard: In some hours the Container Terminal has to sweat her resources and still face with more demand; While in other hours, it will have ample resources that are left idle for long times.



Pictre from Dredgingtoday.com

11

13

13

17

17

22

23

25

10

13/5

16/3

20/8

24/8

39

45

52/6

2400

3600

4800

6600

8724

15500

18000

24000

Ship

Cap

acity

(TE

U)

TEU/m Number of Rows on deck

Changes in Size of Container Stows in Container Ships between 1974-2020

Quay Cranes’ Arrangement and Manouvering on the vessel

• In tandem with ship size growth, more containers are stowed per unit length of them.

• In this sense, QC operations is affected in two ways:

Quay Crane maneuverability and gantry movement (which has been also affected by berth wastage) is more constrained while deployed on vessels. Within the past 15 years, the maneuverable length for each deployed Quay Crane has reduced from 78 m in 5th gen. ships to 61.5 m in 7th gen. ships.

Their spreader movements is also affected as more precision and accuracy in operations is required.



Quay Crane Gantry Movement Lenth in Container Ships between 1974-2020

Quay Crane Size Issues

• In order to maintain the depth and length limits in ship design, special focus has been on growing the size of the beam in the ship and on-deck height of the container stow.

• Introduction of 7th gen. megaships alerted many ports that they should revamp their Quay Cranes or order new equipment to suffice the new normal.

• This trend is also reflected in the delivered Quay Crane units between 2005-2014.

Drewry Maritime Research (2014)



2005 2006 2007 2008 2009 2010 2011 2012 2013 20140

50

100

150

200

250

300

350

400

20 17 20

76

35

19

11

21

6 11

34

48

39

30

21 24

18

45

26

18

70 67 65 67

79

54 53

47

39

21

107

230

197

157

157

102

52

125

96

183

231

362

321 33

0

292

199

134

238

167

233

Outreach in Delivered Ship-To-Shore Equipment (PEMA,2015)

Under 39m40-49 m50-59 m+ 60 mTotal

Num

ber o

f Del

iver

ed E

quip

men

ts p

er y

ear

2005 2006 2007 2008 2009 2010 2011 2012 2013 20140

50

100

150

200

250

300

350

400

14 14 8

17 22

11 7

16

4 7

118 12

7

127

88 88

66

73

82

58

33

99

221

186

225

182

122

53

140

105

192

231

362

321 33

0

292

199

134

238

167

233

Lift Height in Ship-To-Shore Equipment Delivered between 2005-2014 (PEMA,2015) Under 19m"

20-29m

30-39m

+40m

Total

Num

ber o

f QC

s Del

iver

ed P

er Y

ear

Quay Crane Productivity

• In order to accomplish the megaship’s window of operations in ports, it is imperative to sweat the Quay Cranes to provide the needed berth productivity.

• With around 6000 moves in each port, the length of a 7th gen. mega-ship only allows maximal allocation of 8 Quay Cranes to it in the port.

• Shipping lines are demanding 180 MPH on their ULCVs: this need more than 33 MPH on each Quay Crane.

• Some propose that Quay Cranes in the new era shall be maintained and operated like Formula I one-pit-stops.

• In few words : Quay Cranes have found much more strategic importance in the mega-ship era.




Ultra-Large Container Vessels and their Impact on Container PortsSchedule Relability Issues

• Schedule Reliability of liner services have always been a matter of controversy.

• Most container ship’s ATA deviates from their announced ETA. According to J.P. Rodrigue (due to data from Drewry) in 2010, this deviation has occured in 33% of voyages in main trade lanes (with 1 to 3 days delay in arrival), and 50% in global average basis.

• It seems that the growth of port operations of bigger ships (in line with other trends like natural disasters and climate change) can deteriorate the schedule reliability of liner services.

Source : J.P. Rodrigue ( 2013)


Ultra-Large Container Vessels and their Impact on Container PortsDemands and Pressures from Shipping Lines

• According to CAPEX, and TCO of mega-ships, and achievement of economies of scale (in terms of TEU revenue, fuel consumption, etc.) in sea, the shipping lines are always interested to reduce the port time of their megaships.

• This is quiet contrary to the increase of average workloads in megaships, schedule reliability trends, and other mentioned complicating factors.

• The shipping lines ( in form of alliances) act towards administering their commercial interests against the operational targets of terminal operators.

• That is while they also exert pressures towards minimizing their port costs, and they do not necessarily pay the costs of their demands.

Pictre from Container Shipping & Trade

Container Terminal Operations System (Henesey,2006)


Ultra-Large Container Vessels and their Impact on Container PortsImpacts on yard and transport operations

• Mega-ship’s workload is significantly felt in the storage yards of container terminals.

• A shift from 6th gen. ships to 7th gen. ships will entail large increases in storage volume, yard operations , information load and documentary transactions.

• Similarly, the volume of work and information on the transport modes that are connected to the port , are increased intensively

Gen. 1

Ships

Gen. 2

Ships

Gen. 3

Ships

Gen. 4

Ships

Gen. 5

Ships

Gen. 6

Ships

Gen. 7

Ships

Gen. 8

Ships0

10000

20000

30000

40000

50000

60000

70000

473 1086 774 1064 1363 2422 2813 3750

7807

17913

12777

17562

22492

39961

46406

61875Number of Lorries needed for carraige of containers involved in vessel operations

Length of the line of such lorries

Lorry Line Length Estimations for transfer of boxes in vessel operations in a container terminal

Based on the local ratio between 40 and 20 feet boxes in Iranian portsBased on the local ratio between imports and exports in Iranian ports

Number of Related Export and Import Documents to a Ship



Conclusions

In a nutshell :

• Within the past 30 years ports have been the followers to the developments in the shipping industry.

• The container shipping has been focused on developing MORE TEUs IN LESS SHIPS for several years.

• Although this has made economy in sea, it is definitely building diseconomy in ports.

• It seems that day after day, we are having BIGGER SHIPS IN SMALLER PORTS.

• This has left ZERO ROOM FOR ERROR IN THE PORTS.

• Beside from capacity developments, ports are in need of innovation in design and process to face the waves of evolution from mega-ship.

Position in market

Quay Cranes

Berth Wastage

Marine Operations

Schedule Relability

Resource Allocation

Revamping/

Newbuild Orders

Much More

Productivity

NeededMore

Operational

Constraints

More difference between ETA & ATAMore

Moves in Ports

Access Chanel

Higher Peaks & Lower

Troughs

Demands for less

port times

More Haste and Need to

PrecisionMore shift

towards Hub&Spo

ke

More intensive cascading

Changes in Port

Ranking Definition

s

Documents &

Information Growth

More Congestion-prone

Modes

More Operation

s load

Demands for

Lower Port

Prices

More Stroage

Area Needed

Normalizing Resource

Lower Berth

Occupancy

Harder QC

Manouvering

Higher Pressures &

Demands

Issues to become a Megaship-ready Port

Yard & Transport

modes

Filling the

Container Ship

Higher Competiti

on

Many thanks for your attention.

Business

Oral presentation-ULCVs and their impacts on Container ports