Oral presentation-ULCVs and their impacts on Container ports

Ultra-Large Container Vessels and their
Impact on Container Ports
By :
Dr. Hamid Reza Abaie,
General Director of ICT Department, PMO
abaie@pmo.ir
Mehdi Rastegary
Head of R&D, Sina Ports and Marine Services
rand-bnd@spmco.co
‫مقاله‬ ‫کد‬:rcopg15-01990184

ُ ْ‫ل‬ُ‫ف‬ْ‫ل‬‫ا‬ َ‫ي‬ِ‫ر‬ْ‫ج‬َ‫ت‬ِ‫ل‬ َ‫ر‬ْ‫ح‬َ‫ب‬ْ‫ل‬‫ا‬ ُ ُ‫ُك‬َ‫ل‬ َ‫هر‬‫خس‬ ‫ي‬ِ ‫ه‬‫اَّل‬ ُ‫ه‬‫اَّلل‬ِ ِِ َِْْ ِْ ‫ا‬‫ا‬َََُُْْ‫ت‬ِ‫ل‬ََ ِِِ‫ر‬ْْ‫م‬َِِ ِِ‫ه‬ُِِ‫ر‬ُُ َُْْ ْ ُ‫ُك‬‫ه‬‫ُك‬ََّ‫ل‬َََ‫َن‬(ِ‫اجلاثی‬-12)
Allah hath made the ships subject to you, that they may sail through the sea by his
command; and seek your livelihood from his mercy, and you should be thankful towards
him.

By : Dr. H.R. Abaie & M. Rastegary p.: 3Tehran – 28th February 2016
Ultra-Large Container Vessels and their Impact on Container Ports
Emergence of Mega-ships
• Container ships are the
workhorses of global economy.
• They have seen tremendous
growth in size within the past 60
years.
• For instance in comparison
between MV Ideal X (1956) and
M.V. MSC Oscar (2015), we may
find:
 1200% growth in size
 and 20,000% increase in capacity

Emergence of Mega-ships (Continue)
• The size growth trend has been mainly fueled by
economy of scale.
• Yet, many other contributing drivers have boosted
this trend, including:
 Improving Competitiveness of fleets
 Commoditization of shipping services
 Available financing
 Low new-build prices
 Total inelastic demands
 Fleet demand misrepresentations
 etc.

Emergence of Container Ships Generations between 1970-2020
Increased Percentage inDraft
(m)
Beam
(m)
Rows on
Deck
TEU/
m
LOA
(m)
Capacity
(TEU)
Cycle
(years)
TitleYear
DraftBeamLOACapacity
10/83011102392400Fully Cellular1974
11812501232/31313/526736007Panamax1981
8010331332/31316/329448007Panamax-Max1985
8338381442/91720/831866007
Post-Panamax Plus
1995
7011321542/91724/8352872462001
73213781656/52239397155005New Post-Panamax2006
3411616/5592345400180007Malacca-max2013
310143317652552/64562400072020
Source: Lane & Moret (2015)

Source : Ashar & Rodrigue (2012)Changes in Size of Container Ships between 1974-2020
239
267
294
318
352
397
400
456
30
32/3
32/3
42/9
42/9
56/5
59
65
10/8
12
13
14
15
16
16/5
17
2400
3600
4800
6600
8724
15500
18000
24000
ShipCapacity(TEU)
Draft (m) Beam (m) LOA (m)

0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
4,500,000
656,524
1,572,072
2,278,542
3,985,032
3,148,660
3,335,118
908,010
1,639,599
992,755
807,604
556,171
57,978
907,354
1,876,108
2,572,492
4,291,437
3,155,542
3,343,118
933,188
1,719,220
1,050,804
828,551
557,314
57,978
1,411,642
2,143,108
2,879,172
4,310,237
3,190,752
3,359,118
973,588
1,796,973
1,086,852
852,751
557,314
57,978
1,967,450
2,339,958
3,081,572
4,310,237
3,222,522
3,359,118
995,988
1,846,909
1,117,080
862,171
557,314
57,978
2,097,750
2,367,958
3,105,172
4,310,237
3,233,112
3,359,118
995,988
1,855,309
1,117,080
862,171
557,314
57,978
211.43
51.38
37.31
7.71
2.94
0.82
9.16
12.96
12.05
6.61
0.27
0
ProjectedCapacity(TEU)
Ship Capacity Category ( TEU)
Dec. 2015
Dec. 2016 Estimate
Dec. 2017 Estimate
Dec. 2018 Estimate
Dec. 2019 Estimate
Growth in Number between 2015-2019 (%)
33.17 % of Existing
Capacity of Ships in 2020
Based on published data by Alphaliner( Feb.2016)

10.16 % of Existing Number
of Ships in 2020
Based on published data by Alphaliner( Feb.2016)

Container Ships Container Ports
Pioneering in transformation and change towards
improvement
Trying to be pursuant and adaptive to
transformations and changes in Shipping
Continuous Innovation and Improvements in
dominant designs
Nearly no innovation in dominant design
Less Time-consuming and Capital-intensive More Time-Consuming and Capital-intensive
Operability with 100 percent of full capacity Operability with 60-70 percent of full capacity
Proactive in achieving her interests (economy of
scale, load factor, etc.)
Mainly reactive to Shipping market trends
Much organized competition and cooperation in
terms of alliances and consortia
Less organized competition and cooperation in
terms of newly introduced 4rth generation ports
Container Ports Vs. Container ships

Redefining Hub-and-spoke
• Mega-ships will strengthen the hub-and-spoke mode of
operations in Shipping industry.
• With hundreds of Ultra-Large Container Vessels in the
market, ports are struggling to remain competitive by
facilitating the new normal.
• Only few ports in different regions of the world will be
recognized as hubs.
• Other ports should compete to position themselves in
lower ranks of this hierarchy as:
 Regional Pivots
 Pivots
 Feeder ports

Cascade Effect
• By arrival of the new behemoths into the shipping
market, the former giant box-ships will be shifted
to smaller ports or secondary routes.
• In comparison to major ports, the tension on
smaller ports will be even more fierce.
• O.Merk(2015) depicts between 54 to 79% ship
size growth in main maritime trade lanes between
2007-2014.
• This means ‘Arrival of Bigger , Growing Ships
in Smaller Ports’ which is getting aggravated with
much faster pace in terms of introduction of new
megaships to shipping market.
• According to N.Davidson (2014), the average ship
size growth will be between 21-37% on the East-
West trade lanes, and 47-73% in the secondary
North-South trade lanes.

By : Dr. Hamid Reza Abaie & M. Rastegary p.: 14Tehran – 28th February 2016
Value of the Ships and Their Shipments
• The bigger the container ship gets, the
higher soars the value of her shipment
• For instance, the value of cargo carried in
an 18000 TEU (7th gen.) ship is estimated
to be 28.57% more than the value of cargo
in a 14000 TEU (6th gen.) ship, and 125%
more than a 8000 TEU (5th gen.) ship.
• Likewise the value of the mentioned 7th
gen. ship (190 MM USD) is 55.5% more
than the 6th gen. ship (122.2 Million
USD) and more than twice the 5th gen.
ship.
• Accordingly the CAPEX, TCO, and
OPEX of ship for her owners and
operators, and the Value of cargo for its
owners have soared.
384/00
336/00
307/84
304/00
288/00
224/00
200/00
160/00
144/00
128/00
112/00
68/00
24000
21000
19240
19000
18000
14000
12500
10000
9000
8000
7000
4250
ShipCapacity(TEU)
Value ofcontainerCargo in a Container Ship (Million USD)-Assuming 80% full
contaimers in the ship

Scenarios for Port Operations of Generations of Container Ships
% in
Ports
Port
Days
QC
MPH
Meters/
QC
Moves/
QC
QCsIncrease
Move
s/m
Moves
/Port
Ports
Moves
/Rotation
LOA
(m)
Capacity
(TEU)
Year
63/42879/725233/27579681323924001974
84/32876/33243/5344/3173791021926736001981
105/32877/43263/8-14/21239111362629448001985
126/62875/74064/2275/41703111873531866001995
107/92878/24854/5166/22181112399135287242001
1410/62866/26466589/838751142625397155002006
1511/32861/56926/51511/345001149500400180002013
18142865/185771713/260001166000456240002020
A.Lane & J.Morret (2014)

Marine Operations in Ports
• Marine Operation of Bulky, and expensive megaships
is a very critical process.
• Normally marine operations account for more than 30
percent of vessel turnaround time in port.
• The marine operations will become far much risky and
slower for megaships.
• It will require sufficient depth and width in the access
channel.
• The tolerance for any error is strictly diminished.
• Facilitating the port with the needed width and depth
will require a lot of time, and incur great financial and
external costs.
55%
30%
5%
10%
Container Vessel Turnaround Time
Cargo transfer time
Vessel arrival to time to
mooring
Time of mooring to time of
first transfer
Last transfer to time of
departure
Source : Cirrus Logistics (2014)
CSCL Indian Ocean grounded in Elbe river(Feb. 2016)

Lane & Moret ( 2015)
Berth Wastage
• As indicated in the exhibit, in
Berthing of gen. 7 and gen.6
ships, a significant length of quay
will be left idle.
• This will reduce the efficiency of
quay line as the most expensive
resource of ports.
• It also restricts the maneuvering
and arrangement of Quay Cranes
both on the mega-ship and in the
entire quay-line.
• In this way, Mega-ships have
altered the pattern of berth
utilization towards diseconomy in
ports.

Workload Peaks and Troughs: Resource
Management
• In terms of Vessel Operations, the workload of
container terminal reaches its peak when the
vessel is moored and its unloading is begun.
• The workload is smoothed as operations
continue, and it ceases into troughs when the
vessel operations nears to its end.
• As the volume of operations in megaships is
very high, the peaks and troughs vary broadly
form each other.
• This makes the resource normalization process
very hard: In some hours the Container
Terminal has to sweat her resources and still
face with more demand; While in other hours,
it will have ample resources that are left idle for
long times.
Pictre from Dredgingtoday.com

11
13
13
17
17
22
23
25
10
13/5
16/3
20/8
24/8
39
45
52/6
2400
3600
4800
6600
8724
15500
18000
24000
ShipCapacity(TEU)
TEU/m Number of Rows on deck
Changes in Size of Container Stows in Container Ships
between 1974-2020
Quay Cranes’ Arrangement and Manouvering
on the vessel
• In tandem with ship size growth, more
containers are stowed per unit length of them.
• In this sense, QC operations is affected in two
ways:
 Quay Crane maneuverability and gantry
movement (which has been also affected by
berth wastage) is more constrained while
deployed on vessels. Within the past 15 years,
the maneuverable length for each deployed
Quay Crane has reduced from 78 m in 5th gen.
ships to 61.5 m in 7th gen. ships.
 Their spreader movements is also affected as
more precision and accuracy in operations is
required.
Quay Crane Gantry Movement Lenth in Container
Ships between 1974-2020

Quay Crane Size Issues
• In order to maintain the depth and length limits
in ship design, special focus has been on
growing the size of the beam in the ship and
on-deck height of the container stow.
• Introduction of 7th gen. megaships alerted
many ports that they should revamp their Quay
Cranes or order new equipment to suffice the
new normal.
• This trend is also reflected in the delivered
Quay Crane units between 2005-2014.
Drewry Maritime Research (2014)
0
50
100
150
200
250
300
350
400
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
20
17
20
76
35
19
11
21
6
11
34
48
39
30
21
24
18
45
26
18
70
67
65
67
79
54
53
47
39
21
107
230
197
157
157
102
52
125
96
183
231
362
321
330
292
199
134
238
167
233
NumberofDeliveredEquipmentsperyear
Outreach in Delivered Ship-To-Shore Equipment
(PEMA,2015)
Under 39m
40-49 m
50-59 m
+ 60 m
Total
0
50
100
150
200
250
300
350
400
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
14
14
8
17
22
11
7
16
4
7
118
127
127
88
88
66
73
82
58
33
99
221
186
225
182
122
53
140
105
192
231
362
321
330
292
199
134
238
167
233
NumberofQCsDeliveredPerYear
Lift Height in Ship-To-Shore Equipment Delivered between
2005-2014 (PEMA,2015) Under 19m"
20-29m
30-39m
+40m
Total

Quay Crane Productivity
• In order to accomplish the megaship’s window
of operations in ports, it is imperative to sweat
the Quay Cranes to provide the needed berth
productivity.
• With around 6000 moves in each port, the
length of a 7th gen. mega-ship only allows
maximal allocation of 8 Quay Cranes to it in
the port.
• Shipping lines are demanding 180 MPH on
their ULCVs: this need more than 33 MPH on
each Quay Crane.
• Some propose that Quay Cranes in the new era
shall be maintained and operated like Formula I
one-pit-stops.
• In few words : Quay Cranes have found
much more strategic importance in the
mega-ship era.

Schedule Relability Issues
• Schedule Reliability of liner services
have always been a matter of
controversy.
• Most container ship’s ATA deviates from
their announced ETA. According to J.P.
Rodrigue (due to data from Drewry) in
2010, this deviation has occured in 33%
of voyages in main trade lanes (with 1 to
3 days delay in arrival), and 50% in
global average basis.
• It seems that the growth of port
operations of bigger ships (in line with
other trends like natural disasters and
climate change) can deteriorate the
schedule reliability of liner services.
Source : J.P. Rodrigue ( 2013)

Demands and Pressures from Shipping
Lines
• According to CAPEX, and TCO of mega-
ships, and achievement of economies of scale
(in terms of TEU revenue, fuel consumption,
etc.) in sea, the shipping lines are always
interested to reduce the port time of their
megaships.
• This is quiet contrary to the increase of average
workloads in megaships, schedule reliability
trends, and other mentioned complicating
factors.
• The shipping lines ( in form of alliances) act
towards administering their commercial
interests against the operational targets of
terminal operators.
• That is while they also exert pressures towards
minimizing their port costs, and they do not
necessarily pay the costs of their demands. Pictre from Container Shipping & Trade

Container Terminal Operations System (Henesey,2006)
Impacts on yard and transport operations
• Mega-ship’s workload is significantly felt
in the storage yards of container
terminals.
• A shift from 6th gen. ships to 7th gen.
ships will entail large increases in storage
volume, yard operations , information
load and documentary transactions.
• Similarly, the volume of work and
information on the transport modes that
are connected to the port , are increased
intensively
473 1086 774 1064 1363 2422 2813 3750
7807
17913
12777
17562
22492
39961
46406
61875
0
10000
20000
30000
40000
50000
60000
70000
Number of Lorries needed for carraige of containers
involved in vessel operations
Length of the line of such lorries
Lorry Line Length Estimations for transfer of boxes in
vessel operations in a container terminal
Based on the local ratio between 40 and 20 feet boxes in Iranian ports
Based on the local ratio between imports and exports in Iranian ports
Number of Related Export and Import Documents to a Ship

Conclusions
In a nutshell :
• Within the past 30 years ports have been the
followers to the developments in the shipping
industry.
• The container shipping has been focused on
developing MORE TEUs IN LESS SHIPS for
several years.
• Although this has made economy in sea, it is
definitely building diseconomy in ports.
• It seems that day after day, we are having
BIGGER SHIPS IN SMALLER PORTS.
• This has left ZERO ROOM FOR ERROR IN
THE PORTS.
• Beside from capacity developments, ports are
in need of innovation in design and process to
face the waves of evolution from mega-ship.

Position in
market
Quay
Cranes
Berth
Wastage
Marine
Operations
Schedule
Relability
Resource
Allocation
Revamping
/Newbuild
Orders
Much More
Productivity
Needed
More
Operational
Constraints
More
difference
between ETA
& ATA
More Moves
in Ports
Access
Chanel
Higher Peaks
& Lower
Troughs
Demands for
less port
times
More Haste
and Need to
PrecisionMore shift
towards
Hub&Spoke
More
intensive
cascading
Changes in
Port Ranking
Definitions
Documents &
Information
Growth
More
Congestion-
prone
Modes
More
Operations
load
Demands
for Lower
Port Prices
More
Stroage
Area
Needed
Normalizing
Resource
Lower Berth
Occupancy
Harder QC
Manouvering
Higher
Pressures &
Demands
Issues to become a
Megaship-ready Port
Yard &
Transport
modes
Filling the
Container
Ship
Higher
Competition

Many thanks for your attention.

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