Tanada wrote:From several published articles I accidently closed so I don't have the links handy a German company named Beluga Shipping is planning to use the NorthEast Passage along the Siberian coast in 2009 to transfer cargo between Bremen Germany and Yokohama Japan.
Doing so saves 4,700 nautical miles of travel at 18 knots that is 11 days cut off the transit time. I don't know how many ships make the run from German to Japan each year, but even if they only manage to make one leg of the round trip through the passage saving the time for each ship through saves fuel, labor cost, and on top of everything else adds 11 days of potential travel to other places at other times of the year by the same ship. 12,600 miles at 18 knots is 29 days of travel. For every three ships which take the northern rout successfully it is the same profit gain as if you had sent four ships via panama, without the cost of a fourth ship, fourth crew, and fourth fueling for the trip. Cutting the trip from 29 days to 18 is going to be a very significant change, even if it is only viable for 30 days a year. You can roughly plan when the passage will open and keep a close eye on it as the date approaches, any ships leaving from the day before it opens through the next three weeks can be rerouted north as soon as it opens and save massive amounts of time and fuel. Another thing is, if you are a global shipping company you can coordinate ships going both ways, not just one way.
So presuming the passage is open only 28 days, none of your ships can make a round trip through the passage, but ships going both ways can make one leg of their journey using the northern route. According to LINKAnd this does not include marine fuel costs, which rose from an average $295 per tonne at the beginning of 2007 to more than $500 per tonne in November. Fuel today accounts for 50-60 per cent of total transpacific sailing costs.
Now imagine cutting transit time by 38% and fuel usage by the same amount. 295/500=59% so your fuel increase cost of 41% would be nearly cancelled out for this one leg of your yearly passages. Presuming you can keep your ship at sea 290 days of the year with the rest of the time used in port loading, unloading and undergoing maintenance that is 5 round trips between Asia and Europe via Panama. Now divert north for one leg of one of those trips in late summer/early autumn. If you have a fixed price contract you can pocket the difference in fuel costs for the shorter trip, but you better make sure you don't have an early delivery penalty hidden in there somewhere which cancels it out I wonder how this will effect the JIT shipping rules, after all if you have this one window of opportunity per year but you are stifled from using it because everything is predicated on the transit time of the longer route it won't do you a lot of good.
I picture it this way, you company ships identical cargo's every week from Europe to Asia, thus each week one of your ships arrives at the other end of its journey. August 1st you send a ship via Panama, August 8th another, August 15th another, August 22 another. When your August 29th ship leaves port however the Northern route is open and taken, and the September 5th ship, September 12th ship and September 17th ships also take the northern route. The September 24th ship resumes taking the Panama route as the passage will be closed before it can get through.
Now look at the destination ports arrivals, they get the first ship of these 8 on the 30th of August, the second ship arrives September 6th. The third ship arrives on September 13th. Up to this point everything is as the receiver expected it to be. Then the fifth ship to leave arrives at its destination on the 16th, about the same time the 3rd ship is clearing the port. The fourth ship then arrives on the 20th, followed by the sixth ship on the 23rd. The seventh and eighth ships arrive on the 30th of September and 7th of October. The ninth ship however took the Panama route and will not arrive until October 23rd, leaving a gap of two nearly weeks between ships. If these companies use a strict JIT system this would create chaos, first extra ships are arriving to be unloaded and the cargo stored somewhere until needed, then a gap of 13 days instead of 7 between ships eight and nine. Notice however that if you add up all the dates, four ships arrived earlier than expected and only one later.
If you didn't want to mess up the delivery schedule too much and your primary concern was fuel expense you could have the four ships on the northern route slow down as soon as they were through the critical passage, a slower ship burns much less fuel. You could even time it so that they arrive on the same dates they would have arrived via the panama route if you so desire to keep the JIT system from having fits. For the first two ships taking the northern route they could actually travel at reduced speed for the whole trip, presuming the route that it will be clear for at least two weeks. The sailors will get paid for the same duration trip, but the fuel costs would go down significantly because the ships would traverse the distance at 11.5 knots instead of 18 knots. That cuts fuel use about in half due to the laws of hydrodynamics. For ships three and four on the northern route I would say cruising speed until through the critical passage, then slow even further to something like 8 knots to stay on schedule and save as much fuel as possible while doing so.
Thoughts anybody?
Some good numbers in here, but how about the cast guard factor? The Russians require ships sing the oassage be escorted by one of their icebreakers in case something goes wrong. I have seen reports that the US and Canada are completely unprepared for arctic shipping support. No bases or even much in the way of ports to support air/sea rescue operations in case of disasters and accidents.