The big money in slow shipping

Reducing speed is a win-win for both the transport industry and the environment.

You have probably heard of the “slow food” movement and the various spinoffs including slow travel and slow parenting. But is globalization ready for the latest — “slow steaming”?

An oversupply in the shipping industry means that companies can slow down their ships to save fuel and reduce greenhouse-gas emissions by 30%, according to a recent study by Dutch consultancy CE Delft.

International shipping, like the aviation industry, is not regulated by the Kyoto Protocol, and contributes nearly 3% to global greenhouse-gas emissions, compared to the 1.5% of global emissions generated by airplanes.

According to John Maggs from Seas at Risk, the environmental group that commissioned the study, the shipping industry initially criticized the idea of slow steaming because it would require them to build more ships. But since the recession began in 2008, trade has declined, producing a surplus of ships, many of which are sitting at anchor. Some carriers have begun taking vessels out of layup and slowing down their entire fleet to reduce fuel consumption.

Mary R. Brooks, who teaches courses on transportation at Dalhousie University, says the conditions were ideal for the adoption of slow steaming in the fall of 2008, when the global slump created an overcapacity of ships and fuel prices spiked. Since then, fuel prices have fallen and trade has begun to resume. Nevertheless, slow steaming will continue to be economically prudent for some time. Carriers continued ordering ships right up to the market crash, so “the overcapacity is built into the order books of the shipyards,” says Maggs.

It would seem like slow shipping is a win-win situation for shippingand the environment, but Maggs says the industry and the International Maritime Organization are very conservative — and slow steaming is not without its drawbacks. Some cargo owners might object to their inventory being tied up on a ship for longer than is necessary, and choose to go with a carrier that is not reducing their speed. Additionally, some insurance companies were concerned that decreasing the speed of the ships would wear on the engine, but an investigation by Danish Maersk Line showed that speeds can drop from 24 knots down to 12 knots without causing damage or increasing maintenance costs.

Companies that have started slowing down their ships include Maersk, the Israeli carrier Sim, and the Chinese shipping company COSCO.

“They are adopting it, and they are seeing other advantages,” says Maggs.

Indeed, David Cardin, president of Maersk Canada, says he thinks there has been a change in expectations in terms of the time it takes to ship goods. He predicts that the shipping industry will continue to use slow steaming as a cost control measure, even after the economy recovers.

“At the moment, all customers have accepted this response to the trading conditions,” says ardin, “It is a little bit of a switch in conventional thinking.”