NEWS

>> Are direct services becoming less attractive for shipping lines?. more.

>> What happens to the small ships post Panama Canal expansion?. more.

>> Maersk to acquire Hamburg-Sud and reinforce its presence on the Latin America routes. more.

>>£0.5 trillion of trade passes through UK ports. More.

>> The future of rail freight and private investment. More.

>> The Northern Freight and Logistics report. More. 

>> Oxford Cambridge Expressway Study. More.

>> The potential impact of Brexit on trade. More.

>> India - the impact of shipping lines’ consolidation and the cabotage rule change. More.

>> Iran – changes in maritime services post-sanctions. more.

>> 'India: The only way is up' say MDST in an article published by Lloyds List. More.

>> Hanjin’s collapse - A wake-up call to the industry? More.

>> Peak season 2016: could the seemingly more rational shipping lines restore stability to the market?. More.

>> Panama Canal Expansion: the major announcements so far have been made by the CKYHE Alliance and G6 Alliance: each have indicated the upsizing of some of their vessels on the services passing through the Panama Canal as shown in MDS Transmodal's analysis. More.

>> CMA-CGM’s acquisition of Neptune Orient Lines and Cosco’s merger with China Shipping Container Line (CSCL), prompted the need for a few changes in the current capacity-sharing agreements amongst the shipping lines. More.

>> MDST has been appointed by Transport for the North (TfN), in partnership with York Aviation and Regeneris Consulting, to carry out a review of international passenger connectivity in the North of England. More.

>> Chris Rowland, Managing Director of MDST, presented the draft conclusions from the Transport for the North (TfN) Freight & Logistics Strategy at the Freight in the City Conference in Manchester on 3 March 2016. More.

>> With 22 maritime services, Iran is expected to see an increase of around 250% in the capacity of container shipping passing through its ports in spring 2016, as shipping lines seek to benefit from the removal of sanctions. More.

>> MDST Chairman, Mike Garratt, wrote to the editor of RAIL magazine in March about the future of rail freight in Great Britain. More.

>> MDST has examined the evidence for Chinese ‘dumping’ of steel on the global and UK markets using its World Cargo Database, which allows it to monitor world trade by both volume and value and for detailed commodities. More.

>> East Asia export box trade sees growth of 1.7% in 2015, says MDST in an article published by Lloyds List. More.

>> The UK Department for Transport (DfT) has published road traffic forecasts which used MDST’s GB Freight Model (GBFM) to develop forecasts to 2040 for HGV traffic on the British road network. More.

>> Ports should be at the centre of distribution chains says MDST. More.

>> Based on its analysis of Eurostat port statistics and its own World Cargo Database, MDS Transmodal has concluded that ports handled 640 million tonnes in 2014, a market share of 40%. More.

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MOTORWAYS OF THE SEA

The role of short sea shipping in the EU

Based on its analysis of Eurostat port statistics and its own World Cargo Database, MDS Transmodal has concluded that trade between the 28 Member States of the European Union amounted to about 1.6 billion tonnes in 2014 and of this total ports handled 640 million tonnes (excluding container feeder traffic), a market share of 40%.  Rail freight traffic in 2014 was much less at 185 million tonnes, only 12% of the total market.  Short sea shipping therefore already plays a crucial role in sustaining an efficient European economy.

Data presented by MDST at DG MOVE’s Motorways of the Sea (MoS) conference in Liverpool on 20 May 2015 shows that between 2010 and 2014 short sea bulk traffic declined by 1.8% CAGR, while at the same time unitised traffic (RORO and LOLO services including feeder services) increased by 2.5% CAGR.  During the same period non-bulk traffic as a whole only increased at a rate of 1.9% CAGR.  Short sea shipping not only has a significant market share, but the non-bulk sector is securing market share at the expense of road and rail freight. As non-bulk short sea shipping forms the basis of the European Union’s Motorways of the Sea, the data suggests that MoS have been a success over the last few years.

On the supply-side data from MDST’s Ferry and Containership Databanks, shows there were some 1,167 LOLO and RORO vessels operating to and from EU ports in 2014 and between 2008 and 2014 capacity has increased by 49% as competitive pressure forces owners to deploy larger ships and reduce unit costs.  While the mean RORO ship size has increased by 20%, short sea LOLO vessels have increased by 66%.  However, these larger ships present a commercial challenge to the industry when trade is growing at a slower rate.

Fortunately the opportunity for Motorways of the Sea services to secure additional market share is huge.  Our cost modelling suggests that unit load shipping is cost effective over a distance of more than 750-1250 km, depending on whether the service is substituting for a short ferry crossing.  Over these distances a very wide range of road haulage flows across Europe could be attracted to the maritime mode.

 Cost of transporting a TEU over varying distances by means of a Motorway of the Sea service (“sea”), all-road transport and by road and then short sea crossing  (source:  MDS Transmodal, 2015)

As competitive pressures are so great in the short sea shipping industry, the lines face start-up risks and cannot easily capture the potential benefits.  For the lines the risks are often too great and the rewards too uncertain to start up new Motorways of the Sea services.   The ports, on the other hand, benefit commercially through attracting new services to fixed infrastructure, port communities benefit through generating additional gross value added and society in general benefits from being able to switch road traffic to a more sustainable mode of transport.  The solution may lie in ports extending their involvement in the distribution chain by diversifying into shipping (not always permitted in every Member State), ports themselves underwriting the service by guaranteeing cargo or by ports seeking to “capture” traffic on behalf of a line through the development of port-centric distribution.