How shipping can help to avoid pandemics


Diseases like Covid-19 are passed from animals to humans. They spread because of animal trafficking, deforestation and human encroachment into wildlife habitats. Maritime shipping plays an important role here that needs to be addressed.

By Olaf Merk

Cruise ships played a highly visible role in spreading Covid-19
(Photo: Kotenko Oleksandr/Shutterstock)

The exact causes of Covid-19 are still unclear. Yet it is highly probable that it is a so-called zoonotic disease, transmitted from animal to human. Around 60% of existing human infectious diseases are zoonotic, including highly lethal ones such Ebola, Aids, SARS, West Nile Fever and the plague. Zoonotic viruses cause no symptoms in the host animal; for humans they can be deadly.

The main factor behind zoonotic diseases is humanity’s relation with nature. Viruses spill over to people as a result of the exploitation of the globe’s fauna, such as hunting and wildlife trade. Human encroachment into other species’ natural habitats, for instance through logging, mining cultivation or urban development, has increased contact with wild animals and heightened virus spill-over.

“Highly efficient transport networks can propel localised virus outbreaks into worldwide pandemics.”

As humans continue to invade unexplored wildlife areas, more zoonotic diseases are likely to jump the boundary between species and afflict us. Fully 75% of the emerging infectious diseases are zoonotic. Of these, almost half are linked to changes in land use, principally for the production of meat, soy and palm oil.  As science journalist David Quammen, author of “Spillover: Animal Infections and the Next Human Pandemic” put it back in 2012: “If you shake a tree, something will fall out.”

Carrying ballast

The physical interconnectedness of our globe through a finely-woven web of transport links has huge benefits for mankind.  The downside: highly efficient transport networks can propel localised virus outbreaks into worldwide pandemics – as happened with Covid-19.

The main responsibility falls on maritime shipping. This is nothing new – infectious diseases have spread aboard ships for centuries, including the plague in the Middle Ages and the lethal 1918/19 influenza. The role of shipping as an amplifier of infectious diseases has waned somewhat with the decline of sea-borne passenger transport. But ships still spread viral diseases, as the many cases of Covid-infected cruise ships show. A significant part of the spread of Covid-19 in Australia has been associated with infected passengers disembarking from a cruise ship in Sydney.

The ballast water dumped by ships contains alien invasive species
(Photo: Denys Yelmanov/Shutterstock}

Ships also carry pathogens in much more oblique, but no less dangerous ways: via ballast water. Ballast is an essential component of seafaring. During a voyage, vessels take on board sea water to replace weight lost through fuel and water consumption while at sea. The ballast reduces hull stress, optimises manoeuvrability and improves propulsion. No longer needed, the water is dumped into the sea again.

This simple practice can have lethal consequences. Ballast water contains a multitude of microbes, small invertebrates, larvae, and bacteria. Removed from their habitat and dumped elsewhere, they become “aquatic invasive species’ that can cause havoc in their new ecosystem.

“The 1991 cholera epidemic in Peru is believed to have been introduced into three ports through ballast water.”

The 1991 cholera epidemic in Peru is believed to have been introduced into three ports through ballast water from Bangladesh. The disease subsequently spread throughout Latin America, killing more than 10 000 people by 1994. The use of ballast water has been much stricter regulated in recent years, nevertheless it remains a primary conduit for invasive alien species worldwide – with immediate consequences for human health.  

A seamless (virus) supply chain

With a share of 80% of global freight, maritime shipping is the mainstay of the frictionless and cost-efficient transport chains that lubricate global trade. And therefore it is also implicated in the causal chain that links international trade into the causes of pandemics – both directly and indirectly.

Pangolins are the most trafficked wild animal
(Photo: Afrianto Silalahi/Shutterstock)

Legal and illicit wildlife trade is one aspect. Hundreds of millions of plants and animals are moved around the planet every year, with an estimated annual economic value of over USD 300 billion. Several zoonotic infectious diseases have emerged in part due to the human-animal contact that occurs along the wildlife trade chain.

Maritime shipping plays an important but hardly recognised role in this. Take trade in pangolins, one of the possible intermediary hosts of Covid-19. Pangolins are the most trafficked animal in the world, mostly because of their scales which are used in traditional Chinese medicine. An estimated 596 000 pangolins were illegally traded between 2016 and mid-2019 –  usually via ocean transport, with scales concealed in boxes or sacks in shipping containers and declared as fish or other cargo. Arrests, prosecutions and conviction rates are low, also because of corruption at certain seaports.

The forest for the trees

Another example of shipping’s role in the loss of biodiversity is its indifference towards illegal forestry. Depending on the source, illegal logging accounts for 5% to 40% of global wood production. Too many in the maritime supply chain turn a blind eye on illegal wood trade. Working in separate systems, suppliers, transporters and government agencies report forest products differently, which makes identification of – and action against – illegal wood trade difficult.

Shipping plays an important role in the illegal wood trade
(Photo:  Infinitum Produx/Shutterstock)

Law enforcement is weak in many ports. Some have become downright hubs for “wood laundering”, where the origin of the wood is covered up before it reaches its final destination. Ship operators and agents that do not check the legality of the cargo they transport enable such practices. The anonymity of shipping containers helps, as do vessels operating under “flags of convenience” with little regulatory scrutiny. Critics lament “a lack of due diligence, a denial of responsibility, and even of culpable negligence”.

Lessons to learn

The reaction of transport policy-makers to Covid-19 has so far been to address the immediate effects of the pandemic. Soon, the focus should shift towards how future pandemics can be avoided, and such a strategic reflection will need to consider the role of maritime transport.

Such a strategy should identify shipping-related measures to halt the future propagation of pathogens. It should also address the causes of pandemics, such as wildlife trade, deforestation and other pressures on biodiversity loss via changes in land use. Governments should not be shy about making financial help for shipping companies conditional on the implementation of measures which will help prevent the next zoonotic disease developing into a pandemic.

“Seaports should up their game and improve their capability for effective scrutiny of cargo.”

Maritime transport companies, for their part, could use their pivotal role in supply chains to better scrutinise their cargo. The ongoing digitalisation of the maritime supply chain improves the traceability of cargo and its characteristics, including its legality. That way, shipping companies could show they are serious about implementing due diligence on the cargo they transport.

Seaports should also up their game and improve their capability for effective scrutiny of cargo. Several ports have created Wildlife Traffic Monitoring Units to detect and prevent the illegal transport of wildlife. Seaports should also include combating illegal timber and wildlife trade as objectives in their sustainability strategies, and be accountable for their actions on this. 

Certainly certified

The shipping sector can also do a lot to contain further deforestation around the globe. Commitments to move cargo only for clients that comply with certification schemes that protect natural forests would go a long way. These are common in palm oil, timber and paper supply chains, but rarer in the soy and cattle sectors.

Deforestation is a result of export-oriented, intensive agriculture which needs sea transport
(Photo: Rich Carey/Shutterstock)

Examples include schemes run by bodies such as the Roundtable on Sustainable Palm Oil (RSPO), the Forest Stewardship Council (FSC), the Programme for the Endorsement of Forest Certification (PEFC), the Round Table on Responsible Soy (RTRS), the Amazon Soy Moratorium, and the Zero Deforestation Cattle Agreements and, for fish, the Marine Stewardship Council (MSC).

Last but not least, the international community will do well to think more about the role of maritime shipping in relation to biodiversity – in the oceans as well as on land – and include it in multilateral agreements. The new UN Global Biodiversity Framework, currently in preparation under the Convention on Biological Diversity, will define targets and pathways for the conservation and management of biodiversity for the next decade and beyond. It seems like a good opportunity for a strong signal that long-term lessons from the current Covid-19 health crisis are being learned.


Olaf Merk is ports and shipping expert at the International Transport Forum. Views are his own.

The Impact of Mega-Ships

by Olaf Merk

Ever bigger container ships inspire awe and fascination, and are one of the hottest topics in maritime transport. They are also a headache for ports and terminals – mainly because of their vast size.

mega-shipsA new publication by the International Transport Forum (ITF) at the OECD assesses the impacts of these giant container ships. First of all, let’s get a hook on how big these ships really are. They are big! Mega-big! These are true giants, bigger than houses, bigger than apartment buildings and bigger than skyscrapers. They are bigger indeed than whole urban neighbourhoods. Now at up to 400 metres long, these ships are longer than Eiffel Tower (301 metres).

This size increase has been exponential; ships doubled in volume in 20 years between 1975 and 1995, and then almost doubled again in the following decade, doubling yet again between 2005 and 2015. And it ain’t over yet! Plans are afoot to continue increase size to 21 100 TEU* by 2017. (TEU: twenty foot equivalent unit – a small transport container – is a standard volumetric transport measurement)

 

When is big too big?

Although economies of scale allow vessel costs per volume transported to decrease with bigger ships, the on-land costs of handling those volumes increase. Together, these two costs determine the total costs for the transport chain. At a certain point increasing ship size becomes sub-optimal as cost savings become marginal. While a doubling of container ship size reduces costs by a third (vessel costs per TEU), making sea transport cheaper, the savings decrease with increased size.

To find out where we are on the cost curve, we tried a thought experiment. Imagine that instead of ordering 19 000 TEU ships, shipping companies had ordered 14 000 TEU ships giving the same total fleet capacity. In that scenario, land-side costs would have been approximately $50 lower per transported container. This might seem little, but it is actually substantial when compared to freight rates for transporting a container from Shanghai to Rotterdam – now at less than $400 and the thousands of containers ships can carry. Hence, as ship sizes continue to increase we find ourselves heading towards overall increasing costs.

 

Do we really need this capacity?

Our research casts serious doubts over whether this capacity can in fact be filled. We found a disconnect between what is going on in the boardrooms of shipping lines and the real world. The growth of containerised seaborne trade is no longer in line with the growth of the world container fleet. And shipping companies have created alliances (only four in total worldwide) which dominate container shipping. So the little guys can get to the big toys, but this has also leads to overcapacity.

There are also several supply chain costs and risks related to mega-ships. There are adaptations needed to infrastructure and equipment: the ships are longer, wider and deeper which has consequences for cranes, quays, access channels and all that. Mega-ships stay on average 20% longer in ports – quite an achievement for most ports as this requires massive efforts to accommodate these longer-stay guests. The higher risks associated with mega-ships are linked to difficulties in insuring and salvaging in case of accidents. Furthermore, mega-ships mean that more cargo is concentrated on a single ship, leading to lower service frequencies and lower supply chain resilience – all your eggs in one basket.

Mega-ships have redefined the meaning of the word “peak”. Massive truck movements, train movements and yard occupancy are all related to the arrival of a mega-ship. There is a requirement to manage this huge capacity on arrival which may lead to more port congestion.

 

Where are we heading?

We looked at three scenarios: one in line with market demand growth projections, two others above these growth projections, one with 50, another with 100 ships with a 24 000 TEU capacity (and a length of 430 metres), which currently do not exist or have not been ordered – but that could be operational by 2020. The results are pretty scary. We could see 24 000 TEU ships in Europe – both in Northern Europe and the Mediterranean. All other regions would be impacted as ships what used to be the biggest ships serving Europe are reassigned to other routes. So we might see 19,000 ships in North America, 14,000 ships in South America and Africa in a few years. Whatever the scenario, mega-ships will be the new normal in Northern Europe very soon. In just a few years 19 000 TEU ships will be seen every day in major ports. One thing is sure – this will lead us to a decade of port gridlock if nothing is done.

 

What needs to be done?

Mega-ships are a fact of life, so there should be policy support to use them effectively: for innovation, for more labour flexibility, optimisation of existing infrastructure (spreading use over day and night), releasing peaks (e.g. by “dry ports” – inland transshipment centres), and upsizing of hinterland transport units (larger trains, trucks and barges).

On a more fundamental level, decision-making by ports and countries should be more balanced. Many public policies stimulate mega-ship use, but public benefits are limited whereas public costs can be high. This should change, first by aligning incentives to public interests. For example, not to have port tariffs that cross-subsidise mega-ships, to clarify state aid rules for ports, increase their financial transparency and possibly link state aid for shipping companies to commitments to share in certain costs (e.g. dredging).

Another way would be to increase collaboration at regional level, between countries, ports and regulators. This might include coordination of port development and investment, possibly port mergers and more national or supra-national planning and focus. For example, the number of core ports in EU trans-Europe transport network (TEN-T) corridor networks could be reduced.

Finally, there should be a clear discussion on what the future direction should be. A forum for liners, terminals, ports and other transport actors should be facilitated to discuss about the desirable container ship size in the future. The International Transport Forum (ITF) at the OECD is there and willing to facilitate such a discussion.

 

About the author
Olaf Merk is the ports and shipping expert of the International Transport Forum (ITF). The International Transport Forum at the OECD is an intergovernmental organisation with 57 member countries. It acts as a policy think tank and organises an Annual Summit of transport ministers. The ITF is the only global body with a mandate for all transport modes.

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