Ports, Supply Chains, and Abandoned Sailors
What’s happening: The $14T shipping industry is responsible for 90% of the world’s trade. Despite mounting shipping delays and cargo backlogs, the busiest US port complex shuts its gates for hours on most days and remains closed on Sundays. Meanwhile, major ports in Asia and Europe have operated round-the-clock for years. One stark side-effect of the blockage: There are now over 1,000 sailors currently abandoned at sea, on container ships and bulk carriers around the world.
Some background: Industry consolidation has yielded a half dozen shipping firms that ferry a majority of the world’s containers, driving out smaller competitors who are often one delay or cancellation away from foundering. When debts pile up, or the cost of repairs becomes too high, some firms choose to abandon a ship or sell it for scrap. Some governments require sailors to remain aboard as guarantors until shipowners pay port authorities for berth fees and other charges. This puts sailors in a tough spot, with many electing to stay on ships for years with little more to eat than rice.
Details:
Some background: Industry consolidation has yielded a half dozen shipping firms that ferry a majority of the world’s containers, driving out smaller competitors who are often one delay or cancellation away from foundering. When debts pile up, or the cost of repairs becomes too high, some firms choose to abandon a ship or sell it for scrap. Some governments require sailors to remain aboard as guarantors until shipowners pay port authorities for berth fees and other charges. This puts sailors in a tough spot, with many electing to stay on ships for years with little more to eat than rice.
Details:
- Over 90 ships are stuck outside the ports of LA and Long Beach, waiting to dock and unload. LA’s ports see more than 25% of America’s imports.
- The average transit time from China to the US is now over 71 days, compared to 40 days in 2019 (both seem quite long…)
- Examples of abandoned ships that did more than leave a few sailors in limbo:
Russian-owned MV Rhosus, which carried 2,750 tons of deadly ammonium nitrate, was abandoned in Beirut’s port in 2013 for not being seaworthy. In 2020, these chemicals exploded and devastated Lebanon.
Today, a supertanker filled with 1.1 million barrels of crude oil off the coast of Yemen sits decaying in a warzone. A stray rocket or the ship’s corroding steel hull could spark an explosion and massive oil spill that would further disrupt global supply chains and devastate populations.
Dive Deeper:
Really interesting deep-dive into the basics of container stowage planning, and how it’s important for loading/unloading cargo.
Analysis of the US Truck Driver labor market — relevant, as the trucking industry has been named a key bottleneck in this supply chain crisis.
Today, a supertanker filled with 1.1 million barrels of crude oil off the coast of Yemen sits decaying in a warzone. A stray rocket or the ship’s corroding steel hull could spark an explosion and massive oil spill that would further disrupt global supply chains and devastate populations.
Dive Deeper:
Really interesting deep-dive into the basics of container stowage planning, and how it’s important for loading/unloading cargo.
Analysis of the US Truck Driver labor market — relevant, as the trucking industry has been named a key bottleneck in this supply chain crisis.
