By Soji Thomas – “Nobody understands…”, this may not be a new statement for many of us, either at home or in business. Shipping seems to be an industry which is often misunderstood by many.
We can list various brands of products we use, but how many of us can name top shipping companies in this world, who help those companies to produce and make them available in a store nearby? Maybe it is because shipping mostly functions efficiently and remains invisible, many major shipping owners or operators are often unnoticed, irrespective of shipping’s role in our daily life. But, in last few years, various disruptions affecting smooth functioning of the logistics industry, brought “container shipping” into the limelight.
Maritime transport is the backbone of international trade and the global economy. Over 80% volume of international trade in goods is carried by sea according to the 2023 UNCTAD report, and the percentage is even higher for most developing countries. Global Trade thrives at current levels mainly due to the extraordinary cost efficiencies that resulted from containerization. All of us are exposed to some way or the other by using products that are shipped in a container.
Are you at home, the office or outdoors? Look around and pick any product around you. Can you identify where all those products originated? How many countries would have been instrumental in supplying components or raw materials for those final products? The car, bus and train used for your commutation got components from how many locations?
Engines, metal, paint, battery, glasses, leather or fabric for the seats, motors, electronic components including chips, tyres, clothes. . . if we look deeper, you’ll consider raw materials used for these products! If you are reading this on your mobile phone, did you know that some mobile manufacturers sources products from 40+ countries in six continents? A fun activity to try with our kids, which can also help them develop an understanding of how interconnected the world is in today’s globalized age
When we consider the food we consume, many don’t realize the role of shipping. Are you having rice from India or Pakistan, fruits from South Africa, U.S, EU or South American farms? How did you get them from those origins to the store nearby at an affordable cost? How do we deliver our Ethiopian coffee to the consumer in Europe, Asia or U.S? Many of those were transported from one corner of the world to the other with ultimate care by a shipping line.
A few decades ago, did anyone think a fruit produced in South America or Africa could be purchased in a store in Asia, Middle East or Europe at an affordable price? Variation in temperature during transportation directly affects quality of the product, kudos to the container shipping industry for embracing ever developing technologies, ensuring delivery of quality products to end consumers at affordable costs and in the most sustainable mode of transport.
Containerization changed the world – catalyzing globalization.
To recognize the importance of containerization it is important to understand what this world was like, before the containerization. People were transporting goods using bags, boxes and barrels, further loaded onto caravans, ships etc. depending on the distance. But how much and how far can a donkey, horse or a camel carry loads?
The Industrial revolution in the late 19th century and innovation proved these modes of transport were inefficient. Handling was mostly manual, and transportation was slower, costly and riskier with increased cargo damage. Perishable goods were not even considered for transporting long distances. Hence, anything from far was always considered extremely expensive and rare. In the late 19th century, the commencement of railways helped to solve part of this problem, but different product sizes, multiple handling and limited reach restricted cargo flow.
Logistics efficiency was critical during the wars in the early 20th century. Longer and challenging transportation often delayed timely supply of materials on the war front, especially for America, who had to depend on efficient logistics due to geographical distance. In 1948, they developed “Transporter” a small, corrugated steel container capable of loading approximately four metric tons (4MT) of cargo which can be loaded on airplane, ships, trains or trucks. It was successful, but the limited size of box and handling methods still limited scope of usage.
During the period 1955-56, Malcom McLean, a transporter in U.S realized the long waiting periods for unloading cargo from ships to his trucks and felt the requirement of a faster way of handling this cargo. He teamed up with experts, especially with Keith Tantlinger, they developed a new 33-foot-long container with increased strength and other equipments for handling these containers with better efficiency.
On 26 April 1956, vessel Ideal X alongside Berth 26 in Port of Newark was loaded with 58 33’ containers. In less than eight hours, they loaded cargo which would have taken approximately three days to load using traditional ways of loading in break bulk. As per reports, cost calculations between breakbulk loading on those days’ vs first voyage of Ideal X showed 97% cost savings when using containers.
The cost of moving 1 MT of cargo was estimated to be 6 USD and was brought down to approximately 16 cents. Technical and technological evolutions developed various other container types, efficient methods to handle them and massive size of container vessels to carry from one port to the other revolutionized cargo transportation and global trade.
Despite the critical role shipping plays in keeping economies and trade afloat, how often do you hear or try to know about container shipping?
Programs like “Adopt a ship” spearheaded by Cyprus Shipping Chamber implemented in their elementary school levels create awareness and interests in their young generation about shipping. We cannot overlook the extraordinary efforts of our seamen, the vital force behind ocean transport, who endured intense stress during the Covid-19 pandemic, navigating ships through perilous zones. The shipping and logistics sector faces numerous challenges, yet it consistently devises solutions to connect production centres with appropriate markets.
Are you still gazing at your newspaper, mobile phone, or laptop, pondering the diverse origins of the materials that combined to create the product in your hands? Take a moment to appreciate the companies and key individuals responsible for transporting these goods to you. Welcome to the world of shipping—perhaps you’ll view the humble shipping container with new eyes next time.