The differential between the surcharges increases, now reaching $20,000, and so does the number of smaller shippers falling into bankruptcy.
Just like in any other game, it is always the smaller players that usually take the most misfortunate position. In the foolish game of the surcharges, they are carrying immense losses, while some of them fall off the cliff into bankruptcy as the price differential between smaller shippers using spot cargo and larger shippers on contract continues to escalate. Now it is almost reaching $20,000. Although there was a subtle sign of spot rates topping out in recent weeks, many analysts are warning it will take many months for prices to truly cool down. What other Jack in the box is expected? The rise of the insurance costs has taken a strong grip around the throats of the shipping lines that used to be among those profiting from the current madness the most. The predictions regarding how much the price will increase vary from 15% to 25%, therefore life will not be honey-sweet even for the winning players. Sounds like an upsetting scenario, does not it? Especially when Christmas is approaching, and all the fears of empty shelves wash over the minds of not only customers but also of shippers. However, not everyone shares a pessimistic mood. Some sources admit that yes, there are shortages; yes, congestion is everywhere, etc., but if consumers do not engage in panic buying, there will not be any widespread empty shelf winter. They believe that the hysteria is being spread by the companies that lost their competitive advantage. Even if it is true, the current state of things does not provide much confidence in the future. China has not resolved the power crises yet, on the contrary, further disruptions are expected, and as a result, it will lead to longer lead times and a preference for high-value goods. Nobody knows when it ends. While it has become obvious that everyone is struggling with high rates and skyrocketing costs, even robbers have taken mercy on the ships. The recent data has shown that the number of armed robberies has declined by 27% in Asia during the January-September period this year compared to the same period of 2020.
In addition to problems undermining positive prognosis regarding upcoming holidays, the EU does not bring any relief as companies continue to omit UK port calls, which causes a massive challenge for feeder operators tasked with relaying thousands of “overcarried” containers. The good news is that reports are stating that the worst is over and the landside congestion had eased. Meanwhile, the US continues to tackle the problem of bottlenecks by implementing the 24/7 operating hour schedule. More ports such as the Ports of Seattle and Tacoma have taken this approach. This is not going to be the only strategy. Recently, the Supply Chain Act was introduced to the officials, an initiative that proposes to monitor the supply chains of critical goods and design a response to disruptions, using a $500 million annual budget from 2022-2027. It follows up the already accepted Biden’s plan and takes a more detailed look at the hidden costs of faraway manufacturing and supports the idea of companies having more control of their suppliers.
The US ports are not the only ones experiencing the increased throughput. The Russian Container Market has processed 1.3 million TEU in Q3 of 2021, increasing 9% compared to the same period in 2020. However, the decrease is also common in the Northern Ports – a decline of 4.8%.
While Amazon was not the star of the positive news in recent days, it does not mean that e-commerce giants are not on the roll. Perhaps, for China that is still in the darkness in a literal sense, Alibaba will be that much-needed torch. It has gotten a stake in new liner operator Transfar Shipping, which launched operations with China-US west coast sailings in August. This is not just a follow-up of the trend of big e-commerce chattering their vessels. A unit of Alibaba logistics offshoot Cainiao, purchased a 10.33% stake in September last year, so now it is expanding which demonstrates a vertical integration that is different from what the competitors are doing.
It is impossible to decide which sector has been hit the worst, but without a doubt, it is clear that airfreight would share the pedestal. The crisis has shown that it was a big omission not to consider air cargo that important. It used to be the afterthought, but the capacity shortage revealed the pain point of the lack of focus. Now we are in for a big restructuring. Many believe that cargo strategy will now go into aircraft and network decisions, and as it has stepped into the spotlight, more talent will be attracted.
So far, the UK is not the one to be with empty shelves, at least thanks to the rail. Tesco is determined to increase its use of trains to distribute produce by almost 40%. However, the biggest issue of the lack of electrification remains unsolved for the railways to become the ultimate success. In fact, the UK is electrifying its railway at less than half the rate needed to decarbonize by 2050 due to the lack of expertise and the government falling behind its economic recovery initiatives. Meanwhile, STM and Kazakhstan’s Silway Transit join efforts to deliver new electric locomotives that will be especially useful during heavy train operations.
If there is one thing the post-pandemic reality has taught the market players then it is to be ready for unexpected disruptions (or at least try to). Although the industry had experienced a significant drop in Asian congestions and spot rates, it was soon topped with elevated bottlenecks in North Europe and new records in the US ports. The UK, being the new epicenter of the blockages, seems to be finally making the needed steps towards solving drivers shortages. Despite that the companies are still waiting for the government to stop pulling the cat by the tail, the authorities have introduced new measures regarding the cabotage movement that will provide short-term relief. Meanwhile, companies keep looking for alternative ways to charter their vessels in an attempt to deliver their goods on time.
Airfreight is still turbulent and as more talks about the future of it arise, it becomes obvious that even if the new services are introduced, it is the lack of qualified manpower that slows down the recovery. The same is true for intermodal. Some companies go as far as introducing networks between rail and rivers, but will it make sense if there is no one in the workplace? The strike in Italy temporarily causes new troubles. Sign up on MAXMODAL to receive the latest news updates.
When the congestion fills North Europe to the brim, the UK government seems to be ready to act. Why does a threat of collapse appear to be the only stimulus?
Oil on canvas: containerships waiting at ports have become a common scene for the canvases of the EU, The US, and Asia. Even when the situation in NorthEurope is less severe than in the States (although some of the vessels at anchor in northern Europe are far larger than those in San Pedro Bay waiting to berth), the recent data has shown that, at least 20 boxships heading towards Antwerp, Rotterdam, Hamburg, Felixstowe (where the stack density is reaching 92%), or other major ports are queuing. America keeps breaking new records. The Port of Long Beach has registered its second-highest September as unprecedented numbers of vessels wait off the West Coast to unload cargo. At the same time, empty containers moved through the port also dropped by 3.6%. Overall, there is a 5.9% decline in throughput compared to the same period in 2020. So far, moving operations to the 24/7 work schedule has seemed the only solution. Rates and capacity are still tight as more ships start to omit ports; the spot rate for a 40ft to the US West Coast jumped by 8.5% on the week, to $17,377. For East Coast ports, the spot rate increased by 6.5%, to repass the $20,000 marker at $20,695 per 40ft. On the EU tradelane, the rates are still plateaued at $14,492 per the same container in North Europe, and some experts are hopeful for a possible decline. The ships’ prices are soaring too alongside the elevated spot rates. This disrupts the intention of the South Korean authorities to provide funding to local liner and feeder operators through ship sales and leaseback. The plan was crashed after the prices went up, leaving the officials waiting for better times when the residual value drops.
The fate of the businesses struggling with drivers’ and overall delivery options has become a routine for the UK companies long ago. After the government After the UK government botched attempt to belatedly relax visa rules for a limited number of EU hauliers, many enterprises failed to attract significant interest to the sector by using their stimulus. It became clear that the solution is in the hands of the officials, thus they proposed a possible temporary unilateral legislative extension of road haulage cabotage. The proposal is to allow unlimited cabotage movements of heavy goods vehicles for up to 14 days after arriving on a laden international journey into the UK. However, it is still a short-term solution and does not diminish the importance of developing a more diverse domestic workforce.
With shipping prospects rising, there is still a problem of the existence of too many shipping stocks instead of consolidated categories. Although an updated analysis has shown that this number is shrinking, the remaining public players are no bigger. Consolidation has been the major cause of it as well as takeovers by shipping companies – a big trend of acquisitions that goes beyond U.S.-listed shipping stocks all the way to North Europe. Another trend of companies starting to charter their vessels is evolving too. Amazon decided that it would send boxes on the deck of the Norwegian multipurpose operator that is ideal for carrying unconventional containers.
With more challenging on the way, the environment will continue to encourage companies to explore methods to organize their supply chain models in an effort to get their products to market and avoid shortages. This search for a new strategy concerns other sectors that Amazon is willing to explore. For example, airfreight. Some sources report that Amazon is going to acquire a significant number of long-range, wide-body freighters that could fly goods from China and the Asia Pacific region to the US to tackle the problem of bottlenecks. The e-giant has declined this statement, although this method (especially since airbus freighters announced their commitments to e-commerce) should not be underestimated as it would allow the company to establish an ex-Asia airbridge, channeling shipments directly into airline arm Amazon Air’s US network of dedicated airport hub, avoiding delays. The latter is extremely important in the light of the peak season and the forecasts that air capacity will tighten before we even blink. Amazon has already missed the moment when transport costs surged. Now it is trying to induce consumers out of their homes to collect their online purchases from a drop-off point nearby. Anticipating the coming issues, such companies as FedEx have already launched additional flights.
No sooner did the EU recover from the German strikes than the new ones crushed it, this time in the south. Following the introduction of “corona tickets” at workplaces, hundreds of strikers have flooded the Port of Trieste’s area. Supply problems are expected, however, they probably will not last for long as the majority of the ports support this sanitary measure. As for Germany that is gradually recovering, the recent initiative concerns the strengthening of the freight traffic via the Betuwe route – where up to 70% of the traffic between the countries occurs – by starting the new tests of the Automatic Train Operation. The goal is to have a locomotive ready for testing on the route in 2025. More connections are on the way in India as well. APM Terminals Pipavav has become the first Indian port to connect to the Western Dedicated Freight Corridor after
The drop in congestion has not lasted for long. The new epicenter has emerged, this time in the UK.
The hopes to see the ease of congestions last for a bit longer have been crushed way before shippers had a chance to gulp fresh air as UK’s Port of Felixstowe has added up to the chaos. The notoriously famous drivers’ shortage has contributed to an immense backlog of the port that handles a significant amount of the UK’s containerized freight. The delays will affect all sectors from marine to retail and if the ice does not break, they can potentially impact nearly $2 billion of trade imports. As congestion continues, such big companies as Maersk chose to anticipate the problems and divert ships from Felixstowe. Sleepless nights are ahead for everyone trying to get out of the blockages as well for the Ports of Los Angeles and Long Beach that are officially expanding their operating hours to 24/7 schedule. The government backs the decision. Big retailers are also going to use night hours to move their cargo. Although the sector is still deep into a soaring demand, there are indicators that consumer behavior will eventually stabilize and now it seems to be shifting towards services. The question of “when” it is going to happen remains unsolved. The future is a mystery, besides, it is better and more pragmatic to focus on the present especially when the US congestion spills further in Asia. If before it was mostly Chinese blockages affecting the countries across the Atlantic, now it is vice versa. Normally outbound containers are moved into yards in the port to await loading, but because of the worsening congestion in the US West Coast ports, shipping schedules and high volumes of transhipped cargoes from China have led to a relentless arrival of outbound containers. As a result, Busan is becoming increasingly congested and forcing the officials to create temporary storage from the hinterland of the West Container Port in Busan New Port. A further increase in spot rates is probably right around the corner. According to the predictions, on the global scale, consumer inflation will hit 4.5% by the end of this year with container freight prices and soaring commodity prices highlighted as a big contributor, adding 1.5% to the countries from the G20 list economic state.
It is obvious shipping sector is one of the biggest and hulking when it comes to change. Indeed, the industry moves 80% to 90% of the world’s traded goods. From the environmental perspective, it contributes to 3% of global greenhouse gas emissions, so consequently, shipping has to contribute to the reduction of emissions the most. To put it in numbers, 70% of the shipping industry’s energy mix needs to be green hydrogen-based fuels by 2050. Experts claim that a realistic carbon levy will be critical, putting an adjustable carbon price on each fuel to prevent new fossil fuel investments and stranded assets. However, to follow the deadline, a much faster pace should be implemented.
Congestion is not solely a marine phenomenon. To resolve the bottleneck on the rail, a new, large logistics center is going to be built in Malaszewicze, Europe’s main gateway on the New Silk Road in Poland. Despite the promising future, the construction will take significant time and investments, so In the meantime, delays will be the ultimate part of the daily routine. It is not only the EU’s headache – the total rail freight volume in Horgos, China’s closest port to central Asia and Europe by land transport, is up to 48.5% year on year leaving the country no other option but to develop intermodal. This is where partnerships become the biggest assets, thus Bangladesh CCBL is going to build a rail Inland Container Depot in Chittagong to boost the transportation of containers by trains. Among other developments, is the vigorous attempt of Hupac to strengthen its positions by taking over the operations of the Novara CIM terminal in northern Italy through a subsidiary. The company went further and projected further investments in upscaling of its services. Meanwhile, France taps into an interesting rail-river alliance. SNCF Réseau and VNF want to work together and improve operational complementarity between rail and river networks to enhance the modal shift. The focus will be on transparency, cooperation, and digitalization. Waahaven South in the port of Rotterdam sees a temporary solution for its fire extinguishing system. Although the final one is yet to be implemented in 2023, the current change might allow the terminal to continue operating.
Post-pandemic talks to some extent remind of discussion about post-apocalypse. Well, taking into account the cost of all the disruptions, it does seem like one. Resilience is equivalent to the new armor that will protect the industry like a shield. When it comes to airfreight, the outlook is bright no matter the challenges. World trade is forecast to grow at 9.5% this year and 5.6% in 2022, e-commerce continues to grow at a double-digit rate, therefore, joint efforts and modernization should be the man pillars. Moreover, let’s take the positive effect of the mentioned e-commerce – south-it is a great opportunity for intra-Asia trade, as investments are already pouring into improving cumbersome cross-border logistics.
The market finally experiences a drop in congestions and spot rates, but is it really a moment to lay down arms?
Everyone’s hearts must have skipped a beat when the notorious congestion in China has finally shown a sign of…relief? Indeed, the latest data has demonstrated a decline of 47% in just two-and-a-half weeks. What does it mean for the market? Are we in to screw the recent forecasts about postponed recovery or is it a mere exception? Rates have reacted almost immediately, dropping to $13,025 per 40’ FEU on Asia-US direction, however, it does not concern all indexes reporting the updates. With the confusion of surcharges and fees, the situation remains foggy – some shippers are currently able to ship without paying guarantee surcharges, while others are not. Having taken into account such factors as the time needed to solve backlogs, the rates for containerized freight, and the price for sustainable fuel that the industry is planning to switch to, experts assume that the rates will remain elevated and are less luckily to drop below pre-pandemic levels ever again. In addition, nobody can control the weather as a massive disruptor. There is already a red alert in the ports around China’s Pearl River Delta where they have been forced to stop operations because of Typhoon Kompasu, so delays continue.
Paired with inefficient management, port’s bottlenecks can become a real nightmare, and the case with Rotterdam serves as a perfect example. Due to poor yard management, barges with containers on board are being left to stand idle for a week as ECT Rotterdam first approves berthing windows, and then cancels them. Chaotic play board expands as far as India where its largest operator has suspended all containers to and from Iran, Pakistan, and Afghanistan. The radical decision has been announced after Indian officials seized nearly three tons of heroin worth $2.65bn originating from Afghanistan. Meanwhile, Canada is having a rough time too as the on-time arrivals have slumped to 16%. The surging traffic at the port of Vancouver causes major shortages and difficulties to transloading activities.
Bottlenecks in the air logistics supply chains spark vigorous discussions on the future of the sector. It is clear that in order to move on, the industry has to get used to the “new normal” when the traffic is soaring. This realization should lead directly to the rethinking of the recruiting policy because more manpower is needed ASAP. Among other issues to be solved is better communication of the terminals and the question preighters that has proven to be not that effective.
The unbothered players are still shipping lines as more profits increases are on the way – it has been estimated that if the situation remains the same, the figure will reach a massive high of US$150 billion for 2021. Sustainability should not be understated as one of the drivers of future market changes especially when big companies continue to undertake major steps. MSC is strengthening its partnership with China in collaboration with China Waterborne Transport Research Institute amid to find the best ways for energy transformation for shipping. In addition, the Port of Rotterdam has become the choice of Norwegian clean energy company Horisont Energi and Koole Terminals for the development of an ammonia terminal, so the new technology could reach all clients thanks to Rotterdam’s favorable location.
Although it is impossible to predict what can possibly disrupt rail next, there are some points that companies may consider and measures they can undertake to eliminate some of them. For instance, to improve the safety measures to minimize the number of accidents. The Sheffield station learns from mistakes. A long assessment has revealed the changes that need to be made to the implementation of processes for identifying high derailment risk locations; the implementation of safety-critical changes to its processes; standards governing fitment of check rails; and track geometry data formats. This will require significant infrastructure changes. Another country that taps into them is Moldova where FM-Moldova Railways agreed on a 23,5 mil. euros loan for rail development, especially in safer locomotives. Rhenus Logistics is also embracing the building momentum of the rail market and launching a landbridge service between South Korea and Europe. In addition, it makes an ambitious 80% acquisition of Belgium-based Wijnands Bulk Care to increase its range of services in the Benelux proving that intermodal solutions hold the prospects for the future.
It is no secret that even such giant e-retailers as Amazon have been experiencing pressure on their supply chains, however it does not prevent the same Amazon from baring its teeth at outside deliveries. So far, it has not been its primary focus, but now the company is seriously considering diving into competitors’ shares and providing much cheaper delivery services. Hopefully, the e-retailer will not bit more than it can swallow.
The rush of big revenues and high rates are making the heads of shipping lines go right round to the point when they start playing a trick on customers with surcharges, and the market chaos plays in their favor. The latest forecasts predict that they can enjoy this turmoil until 2022, a new deadline until when the awaited recovery might be achieved. The waiting game is already taking too long, so companies start focusing on the present and value immediate steps more than strategies for the long run. Thus, more ports’ are undergoing expansions, the authorities call for round-the-clock operating hours, significant investments in infrastructure are expected, and acquisitions take place not only in Europe and the US, but in the Middle East as well. However, none of the additional financial expansions will do any good, if the most fundamental problems are not solved. Issues such as drivers’ shortage. The initial plan to wait until the new visa policy is implemented are long forgotten, and companies are going to focus on bringing back the drivers who left the industry for more attractive jobs. Retailers are acting rapidly too, revolutionizing their delivery policies in accordance with what is really needed on the market – quality and speed.
While shipping sector is occupied separating the wheat from the chaff (all the different surcharges), intermodal pushes forward towards the new milestone.
In the wind whirl of different surcharges, it is quite easy to lose one’s mind and keep track of the ocean freight prices played by shippers and surcharges to guarantee space and equipment. The difference between the two is growing, now reaching $10,000/FEU. It is getting more and more difficult to understand the market as, in addition to everything else, the spread between low to high and from short-term to long-term contract rates is bigger than ever before. The customers first, will have to carefully examine the reality and ask themselves such questions as to whether their cargo will go through congested port and how quickly they need it to be delivered. This is especially vital in America’s direction where the retail import rates are destined to remain at elevated levels through October. Without a doubt, ships will eventually get unloaded, but the peak season and additional pressure make it everyone’s headache. Spot rates are being driven up too, but there are a few loopholes – an opportunity for some forwarders to grab space at heavily discounted rates in last-minute deals during the holiday period, due to power outages causing production cuts in China. However, with no hopes for a recovery in the near future, this fortune seems more like an exception from the rule rather than a glimpse of possible improvement. Retailers, being hit the worst, are using it as an opportunity to speed up the deliveries, as there is no other choice if they want to satisfy the soaring demand. Home Depot becomes a pioneer of using GoLocal’s the same- and next-day local deliveries service.
Airfreight rates are no better as they continue to experience the climb following the rise in airline cargo capacity utilization that went up to 68%, higher than any pre-COVID peak season level since 2018.
The Port of Hamburg, the recent star of the headlines thanks to its partnership with China, continues to make its way with strengthening relations – this time with the Port of Valencia. The collaboration will cover such areas as decarbonization, digitalization, connectivity, and equality policies. So far, the parties have agreed that a new electrical substation can become the major tool for achieving the reduction of emissions in ports’ operations. Meanwhile, Climate and health coalition Ship It Zero is calling on IKEA to transition to zero-emissions shipping by 2030. IKEA has been one of the most vigorous retailers advocating for the green future, but now there is a petition demanding a faster and more confident approach from the giant.
The UK is still on the list of those struggling the most since the decisions of its leading ports to impose restrictions on the return of empty boxes due to congestion issues. For example, the Port of Felixstowe already suspended the return of Evergreen, Maersk, and CMA CGM empty containers. This all only compounds the severe shortage of HGV drivers that the industry is facing. One of the means to tackle this problem is the new campaign amid to bring back the drivers who already have a relevant license but chose to retire or switch to a more stable and profitable sector. The initiative is justified by the fact that the government is taking too long to implement the needed changes into the current visa policies but the labor force is needed ASAP. Data also shows that more than 13% of businesses are now facing big difficulties recruiting warehouse staff.
The perspective of shippers switching to rail becomes more prominent as they start questioning how frequently their needs can be met, and how rail freight services could improve. Perhaps, intermodal can kill two birds with one stone and address these issues. In addition, it provides alternative routes through more waypoints that can help to avoid congested ports. For example, Cosco Shipping Lines is offering an expedited intermodal service to get shippers’ goods from China to Chicago in the US in 19 days, which is a good lead-time compared to the delays due to congestion. Asia remains a desired partner for many companies despite the challenges the region is currently facing – Ukraine has launched its first export train to China in an ambitious attempt to establish itself as a New Silk Road transit and final destination, while the first east-bound train. However, there is its competitor in Kaliningrad, the main transit hub on the New Silk Road, where a new terminal has been opened. New connections concern the North too with Hupac adding another departure to its Lübeck-Novara shuttle. The UK to secure the future of its critical cross-border transport link in Wales in England and for this matter, Network Rail is going to invest 28m euros. The decision is dictated by the line’s vulnerability to climate disruptions and particular sensitivity to severe weather conditions.
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Does every new day bring industry players further from that long-awaited period of “normality”?
“We are open for business” is about to become the US heavily congested ports’ motto in the coming days as the government starts pushing them to round-the-clock operating hours. Shippers and carriers cannot sleep with all the nightmares about post-pandemic recovery anyway, so now they are encouraged to have longer gate hours in order to solve the capacity crisis. Railroads and truckers eventually will be affected too but a truly intermodal plan takes the entire goods movement chain from the source that might still require more time to develop from the organizational point of view. While everyone braces up for almost non-stop work, the situation still looks like desperate attempts to crawl out of the rabbit hole when your hands and feet keep slipping. Unsuccessful. The new forecasts predict that the sector is probably in for a turbulent second half of the financial year, leaving shippers with crashed hopes for recovery. Major players expected more progress at this stage, but the current situation proves that the problems are so deeply routed that the end of 2022 seems like a more likely timeframe for things to get better. For carriers, especially big ones, it means another period of growth. All factors combined, they are now on course to EBIT of $150bn, a groundbreaking record. Although for the next year spot rates will most luckily decline, there will be a significant increase in contract pricing, leading to an increase in average global pricing of about 6% and as a result to booming earnings. The slowdown of the spot rates growth can already be spotted. Major East-West trades inched down by 2.2% this week reaching $10,129.72 per 40ft container. Freight rates on Shanghai to Los Angeles dropped 8% or $999 to reach $11,173 and Shanghai to New York fell 5% or $739 to $15,110 per 40ft box. However, worsening port congestion and delays in California are still keeping Asia-US prices extremely high.
The sector has seen big acquisitions and new collaborative efforts in the EU and the US this week, and the Middle East has followed suit. Abu Dhabi Ports have decided to address the problem of growing trade demands within the Gulf region by establishing the UAE-based container feeder services company, Safeen Feeders which is a joint venture with Bengal Tiger Line. The move is not solely dictated by the growing demand. The company’s rival DP World in Dubai has a very extensive feeder footprint having bought Unifeeder and other liner operators in recent years, so it is an attempt to become more competitive.
Despite the “glory” washing over the shipping lines, they are still going to carry major expenses in South Korea where not so long ago Korea Fair Trade Commission imposed fines on those who fell foul of anti-trust laws in order to protect the sector from monopoly. Although the decision was amended after several protests and reports proving the damaging effect of the measure, it was done too late. Most probably, 23 liner operators will not be able to avert the fines of nearly $672m.
While ports can only hope for the bottlenecks to resolve, airfreight is experiencing the quadruple influx of the number of freightersheading to the US, and it is not something to be excited about. It is putting immense pressure on the warehouses and forwarders who need to collect cargo quickly, but their facilities are full, too. In addition, there is a lack of drivers to handle the load, so all this bouquet of challenges is creating a logjam. DHL takes a massive turn on the investments on the expansion and the upgrades of its American facilities, planning to spend more than $360m. The cost of any kind of construction will be extraordinary this year, as the prices for materials are soaring. What does it mean for the customers? The clients of the DHL Express will pay at least 5.9% more for their traffic with the integrator, which has also indicated that some surcharges will also increase. While some airline companies are testing the waters and reducing the number of aircraft they operate in preighter configuration, the future is still uncertain. Experts are wonderingwhat is going to happen when that capacity is back 100% or even more, taking into account that many carriers are trying to enter the transatlantic market.
Trying to reduce its carbon print, Maersk, in collaboration with Wärtsilä, is going to test an Air Lubrication System manufactured by Silverstream Technologies. The system creates a carpet of microbubbles that coat the entire flat bottom of the vessel. This carpet then reduces frictional resistance between the hull and the water. Maersk is clearly trying to strengthen its network in every field from its own services to the green agenda as recently it has also signed cooperation framework agreements with the China Classification Society.
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