Cutting to the Chase?
“Self-serving” strategies and announcements are easy to spot and reflect poorly upon those who make use of them. We saw a classic example in Kizzi Nkwocha’s 10/6/2011 IFW report. His article began with the headline: “Slow-steaming the right route to savings – Maersk study shows no damage to vessel engines from cutting speed” … and Kizzi writes:
“AP Moller-Maersk has predicted that more vessels will be cutting speeds after it completed a study which, the Danish shipping giant claims, proves that slow-steaming doesn’t damage engines.
“Jan de Kat, Maersk’s technical adviser, said the company’s operating expenses had declined as a result of the practice because it placed less strain on the engines, meaning they required less maintenance.
“‘If you look at average speeds, we think they will be slower,’ de Kat said. ‘There were a lot of concerns about soot build-up, vibrations and propeller health. We addressed those concerns and found solutions.’
“The most economical speed for container ships is 10-15 knots instead of the standard 25 knots, according to the company, which has a fleet of about 500 vessels.
“The findings from the research were presented at a Brussels seminar this week, and de Kat said Maersk hoped the results of its study would reassure other shipowners that they won’t damage vessels by following the same strategy.
“Maersk backs voluntary slow-steaming rater than by regulation, so shipowners can retain the flexibility to keep shipments on schedule, de Kat said.
“Maersk said its findings applied to any ship propelled by a two-stroke engine, the most common type for containerships, bulk carriers and tankers. Maersk said its own fleet had reached its lower limit and won’t slow further.
“The average speed of vessels globally has fallen by around 27% since July 2008, when average daily earnings were 3.6% higher than today, according to data from Bloomberg and Clarksons, the world’s largest shipbroker.
“As global demand fell and fleets swelled, shipowners reduced speed to boost earnings and save fuel.” –
Now Kizzi. You of all people should know better than to print such rubbish. Instead of cow towing to this shipping giant, you should have punched holes in this bit of propaganda. You should have put Marsk on notice that some of us – even some shipowners – know what the score is and that efforts at disinformation will eventually backfire.
Didn’t you read the early June 2011 story about the study made available by Lloyd’s Register which dealt with the illogical, impractical and costly practice of slow-steaming? The study released by marine classification society began with the statement:
“Lloyd’s Register has dismissed the ‘slow-steaming’ concept, introduced to counteract skyrocketing fuel prices, as costly and harmful to the environment”, and passed the following information on to Marine Biz TV:
“Containerships are built to operate at higher outputs and will need to be more closely monitored when slow-steaming to avoid loss of engine performance, fuel quality, and lubrication oil consumption when moving below 20 knots. The large containership is designed for 25 knots at 70,000kw main engine power and will require just 50 percent power when reduced to 20 knots. As voyage times increase, fuel savings will be less, and at slower speeds, NOx emissions also increase, resulting in waste engine capacity, higher capital costs from unused power potential, losses in heat recovery systems, turbocharger and propeller efficiency as well as increased fouling of hulls and propellers. Lloyd’s register also warned of increased compensatory fuel consumption and possible increased vibration levels risking safe, reliable ship operations.” –
What could be clearer than that, Kizzi?
Instead of swallowing his line, you should have asked Mr. De Kat:
– If slower speeds are the “most economical”, why is Maersk still ordering giant high-speed containerships?
– According to the Federal Maritime Commission, members of the National Industrial Transportation League (NITL) are experiencing increased shipping costs since the implementation of “slow-steaming”. Why is that?
– Shippers are now complaining that transit times have risen, effective vessel capacity has dropped, shortages in containers have been exacerbated, and meeting customer expectation is more difficult. The NITL, in fact, is on record as stating, “In many cases, shippers or their customers cannot accept decreased service frequency. They must turn to higher-cost transportation alternatives (such as air). The reduction in frequency also pushed up prices because it had resulted in a reduction of supply. The policy had also exaggerated container shortages, because more containers are in transit at any time.” Does this sound as though shipowners are “retaining the flexibility to keep shipments on schedule”?
– Isn’t reduced consumer demand the real reason for “slow-steaming”? Don’t fewer goods require the laying up of a carrier’s excess capacity? And doesn’t “slow-steaming” allow that excess capacity to remain in service and out of scrap yards – for the time being? – regardless of the added costs borne throughout the supply chain, and by consumers as well?
– And finally, is Maersk inducing rival carriers to adopt “slow-steaming”, so that competing vessels will be damaged and put out of commission? They wouldn’t do that – would they?