In a world of economic uncertainty, unsettled even further by Brexit confusion and US-China trade disagreements, global trade usually comes into greater focus and is particularly affected. Ocean shipping is an industry that, like the transport itself, has had to navigate stormy waters, with recent accusations of the actual practice of ocean shipping being used as a method of getting round trade sanctions. In this case, China was being accused of breaching sanctions against Iran by using ocean shipping to move crude oil.
On a more positive note, the continued rise in e-commerce is feeding further growth in the ocean shipping field, and the industry itself is feeling the effects of technological change and innovation. Shipping practices and logistics are becoming increasingly digitalized and shifting the global supply chain arrangement.
Demand for ocean shipping growing, but slowly
The US-China trade war has seen a move towards protectionism, where both sides react defensively to the others’ tariff hikes by doing the same thing. As a result of this disagreement, the higher tariffs have put manufacturers off from shipping goods across the world, meaning the ocean shipping industry has felt the pinch from slower growth in demand. But the growth is still there, and there are a number of factors that should lessen the impact of the expensive tariffs — with a suggestion that rather than stop buying goods altogether, consumers will instead shift to buying cheaper versions of the same goods. Given that a cheap T-shirt takes up the same amount of space in an ocean shipping container that an expensive one does, this practice will ensure ocean shipping is not affected.
Other reports acknowledge the ongoing turbulence from the China-US trade tensions, but point to the 4% expansion in containerized shipping in 2018 as a sign of continued good health in the ocean shipping industry. And if companies can address issues with pricing transparency, and agree on mutually usable digital platforms and working models to better integrate their own systems and keep the supply chain flowing, the report says the ocean shipping industry can be strengthened even further.
The entrance of more millennials into the ocean shipping workforce is thought by some to be key in driving faster adoption of seamless online systems across the industry. And as more smaller players join the ocean shipping sector, more change is forthcoming in the form of mergers and acquisitions — with forecasts pointing towards greater consolidation and the creation of bigger shipping entities, as they swallow up the smaller companies.
How is technology improving ocean shipping?
The pace of technological change across all our lives is no different in ocean shipping, despite the industry often being thought of as a traditionally slow adopter of new technology. Some market reports say that 90% of ocean shipping industry insiders who were surveyed think their organization will increase IT spending through 2019 and 2020, with much of this spending on new technology that will improve operational performance. Specific areas include automation, business intelligence, planning and management systems and big data analytics, while the Internet of Things has not passed the ocean shipping sector by either — with forecasts also pointing towards greater take-up of smart containers, which will see containers fitted with disposable tracking devices to aid monitoring of progress through transit.
Devices that do much more than enable the tracking of containers are more widely predicted in other reports pointing towards a heavily digital future for the ocean shipping sector. It is forecast that ships will feature devices that detect when an on-board repair is required, or which even allow for remote controlling by land-based staff — removing the need for any on-board human presence entirely.
Shipping practices that are safer for the environment
The impact that ocean shipping has had on the environment over the years has been well-documented, with numerous oil spills in particular having a devastating impact on ocean and marine life. Forecasts point towards more moves in the future to make ocean shipping greener, by adopting liquefied natural gas as fuel in order to reduce emissions. With CO2 emissions reportedly 25% lower using this form of fuel compared to diesel, according to Elengy, it is easy to see why this would be an appealing option.
Another environmentally friendly method of powering ships is wind and solar power, with the technology of solar power in particular already being extensively tested. The TuranorPlanetSolar has already travelled around the world using power gained through the use of 29,000 solar cells and if bolstered by on-board turbines, could be a realistic proposition for environmentally friendly ocean shipping of the future.
A future safeguarded by technological innovation
Despite growing pressures from trade wars, economic slowdowns and uncertain manufacturing levels, the ocean shipping industry is set for a solid future if it can harness the opportunities offered by technological advancements. With intense focus on climate change and the environment in particular, such advancements seem set to help the ocean shipping industry reduce its carbon footprint too.
