Home Business Container Ships Getting Too Big Is A Self-Solving Problem

Container Ships Getting Too Big Is A Self-Solving Problem

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It is indeed true that container ships are getting bigger. The usual measurement is how many 20 foot containers they can carry and that’s risen, just in the past couple of decades, from 8,000 or so to 20,000 or so as the top end of the market.

There’s also a certain rigidity to naval architecture. You can’t go on making ships longer and longer. Waves, d’ye see? The structural strength of the hull must be able to deal with waves running under it. The longer the ship the more waves can be trying to do that at the same time. Get “too long” and we’ve not got steel, nor welding, strong enough to deal with having multiple waves beneath the hull at the same time. The ship would just break its back in heavy weather.

So, ships get wider, not longer. This becomes something of a problem in canals of course. But this is all a self-solving problem all the same:

Being able to load more shipping containers onto a single vessel results in economies of scale that sink through to their owners’ bottom lines.

“The biggest cost is the ship and then fuel,” says Paul Stott, senior lecturer in ship production at Newcastle University.

“As ships get bigger, the rise in fuel costs is proportionately less, so container shipping lines naturally went bigger as the earning potential rises faster than the cost of fuelling them.

“It’s a highly competitive industry, and the shipping lines are looking for any advantage they can get.”

The incentive is to get bigger all the time. Still, self-solving:

Apart from saving on fuel costs, these seaborne leviathans derive other benefits from their size.

Docking and loading them is faster than handling a series of smaller ships, which would have to wait for a berth.

Still that get bigger incentive, still self-solving:

The limiting factor now is that when they are longer than four football pitches and stand 20 storeys from their engine room to bridge, ports and cranes are simply not big enough to handle them.

Dredging deeper harbours, and building even longer berths and higher cranes are likely to be prohibitively expensive, and put an inevitable cap on the size of ships.

There comes a point when the costs of altering the surrounding infrastructure becomes greater than the benefits of the lower running costs per TEU. This being one of those problems that markets are so excellent at solving, so much so that we don’t have to do anything, it’s self-solving.

Simply leave everyone alone. Prices are the information people need – how much does it cost to move a TEU? To rebuild a port? – to come to the correct decision. Given that we do have prices here we need do nothing else.

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