There’s no end to the confusion surrounding Detention and Demurrage (D&D) charges for ocean container movements landside. This recital of some recent lawsuits shows that firms are not passing on information that would allow actual determination of accurate D&D charges.
Tthe FMC is starting to crack down on billing that isn’t complete, but some firms may not comply right away, and of course there are older cases which did not come under the recent rule.
The recourse is the courts, and that’s what’s happening now. The supply chain ‘partners’ in the move are handing off responsibility one to another. The Hapag-Lloyd story, involving a forwarder ME Dey, their haulier New Age Logistics, CSX Rail, and Hapag, is just such a case. One claim being made is that the haulier asked to use their chassis to haul the containers to avoid the D&D charges; but they were told that they could not do that, because the containers “belonged to the steamship line”. This kind of nonsensical behavior is not cooperation, and does not facilitate good supply chain relations. Expect more lawsuits!
UMAS is an acronym for University Maritime Advisory Service, a commercial advisory service, or consulting firm, focusing on the maritime segment. It makes use of the University College London shipping team as subject matter experts, and takes on relevant projects for the maritime industry.
Recently they’ve released a report entitled A Strategy for the Transition to Zero-Emission Shipping, which tries to spell out ways that a pathway to a 1.5 degree Centigrade increase could be found. It’s an interesting study because it deals with not only the science-based facts about fuels and propulsion systems, and ship designs, but also with the organizational, regulatory, private investment, and geopolitical aspects of a transformation.
The study outlines three scenarios for a fuel transition away from fossil fuels. These are:
A spread from a strong first-mover country to others
Independent spread from several countries
Global actions (such as the IMO) to drive international spread.
The report goes on to identify levers for change in each scenario, covering three phases of the transition to 1.5 degrees C. The phases are Emergence, Diffusion, and Reconfiguration. They are captured in Figure 19, on page 67 of the report. Here you can see the importance of developing new technologies and investing to expand deployment in the first two phases.
The question they address is how to get all the factors necessary to work for the change in each phase. Especially important are the Energence and Diffusion phases, partly because that’s where we are now, and partly because success there largely determines how we reach the final phase.
The report sees a place for all three scenarios in the effort. It’s quite clear about how companies, governments of states, and international organizations could participate and make the transition easier.
One interesting point is the attention paid to constructing green corridors between different ports, both domestic routes and international ones. The green corridor movement is a powerful driver, and there are now lots of examples starting to appear; they are outlined in the report. The analysis is quite detailed, with actual corridor possibilities outlined, and key national players identified. Experience with the difficulties of establishing them will be important to make the process easier in the future.
The report is also positive about the IMO and its role, while acknowledging some of the difficulties relying on it introduces.
It’s quite an exceptional work, and I recommend reading it. I wish I’d been part of it!
American Bureau of Shipping (ABS), a US-based classification society, has announced that it is developing simulations of potential green maritime shipping corridors. Such a tool will allow users to determine if a particular corridor is feasible, and what the costs will be.
Simulations will also allow us to determine the range of improvements that will be required, and the sensitivity of costs to many different choices, like size of bunkering facilities for different alternative fuels. These sorts of metrics are very important when deciding how much to invest in a green corridor development.
The article below doesn’t reveal very much. But it’s clear that a major classification society can play a major role to influence the greening of maritime routes.
Supply Chain and Logistics 