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INTERMODAL UPDATE – SHIPS: Larger Ships Mean Big Changes for U.S. Ports

Changes in ship sizes, especially the differences in sizes, are requiring ports to consistently update the way in which these ships are received and processed and the infrastructure needed to do so.

* By Mary Lou Jay *

Over the past two decades, the largest vessels in the world’s shipping fleet have more than doubled in size. In 2005, the largest container ships were just under 10,000 TEUs; today, IHS Markit reports that 80 percent of current orders are for ships larger than 10,000 TEU. In 2017, the 21,413 TEU OOCL Hong Kong became the world’s largest container ship, but two shipping lines have already ordered 22,000 TEU ships.

Many of the medium-sized ships displaced by these large vessels have been scrapped. The ship breaking industry reported a record high volume of container ship scrapping for 2016. But shipping lines are also deploying the 6,000-10,000 TEU vessels in different ways.

In his report, “Big Ships, Big Challenges: The Impact of Mega Container Vessels on U.S. Port Authorities,” Noel Hacegaba, the Port of Long Beach’s chief commercial officer and managing director of commercial operations, noted, “The arrival of the larger ships is creating a cascading effect in which ships being replaced by the mega vessels on the major trade lanes are being deployed in the smaller trade routes. Thus, the strain of larger vessels has the potential to affect all ports, big and small.”

Although the largest ships generally don’t come to North America, U.S. ports are handling bigger vessels than before.

“From the North American perspective, the fastest growth in the size of ships used in vessel deployment is the Asian trade,” said Steve Rothberg, partner in Mercator International LLC. A decade ago, 5,000-6,000 TEU ships were considered the norm in transpacific service, but there are fewer now and their numbers will continue to decline. A large number of services are now operating ships in the 8,000-9,000 TEU range, and at least one shipping company is routinely using 14,000 TEU ships from Asia to California. Three or four others are deploying vessels between 11,000 and 13,000 TEUs.

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