The following infographic is shared courtesy of Visual Capitalist
The following infographic is shared courtesy of Visual Capitalist
Shipping activity across the world’s oceans is the lifeblood of the global economy, transporting billions of tons of goods annually and facilitating global commodity flows of oil, coal, grains and metals. Vessel activity is also of critical importance to Intelligence and Security agencies worldwide, as criminal and terrorist activity has become increasingly global and borderless.
And yet, the oceans remain one of the last ‘wild west’ frontiers, with limited visibility on what ships are actually doing once they leave port. AIS data, the most widely used data on ship activity worldwide, underlies decisions from Finance to Intelligence, but the data is unreliable and increasingly manipulated by the very ships it seeks to track.
And this trend is growing, fast, with little-understood and far-reaching implications worldwide.
AIS data, used routinely by decision makers across industries, is widely perceived as a reliable source of information on ship activity worldwide. Massive financial investments and critical operational decisions are based on this data.
New research from Windward reveals that AIS data has critical vulnerabilities when used to track ships, an ‘off label’ use of the system. The data is increasingly manipulated by ships that seek to conceal their identity, location or destination for economic gain or to sail under the security radar.
Manipulation practices are varied, according to Windward’s research, and range from Identity Fraud, to Obscuring Destinations, ‘Going Dark,’ Manipulating GPS, and ‘Spoofing’ AIS. Ships that manipulate AIS undermine not only their own data, but the entire maritime global picture — once some of the data is corrupt, all data is suspect.
If this kind of manipulation is occurring on ships, consider the impact of ‘cargoes/substances’ on board ‘ghost ships’. You can find the Windward Research paper “Analysis of the Magnitude and Implications of Growing Data Manipulation at Sea” as well as a poignant infographic on their website, by clicking the hyperlinks. Source: Windward.eu
I found the following book review on AllAboutShipping.co.uk and I’m sure the featured book will appeal to many of you associated with shipping, containers and trade in general.
A unique first-hand account of the inner workings of globalisation from the heady days of manic growth in the noughties, Around the World in Freighty Ways is a personal travelogue with a difference. Covering over 50,000 miles with not a flight in sight, Gavin van Marle’s anthology puts into perspective the unsung heroes of world trade, the simple shipping container and the freight people who move them throughout the world.
The urge to travel is irresistible for those who have it in their genes. For Gavin and his equally restless wife Alex, what better way to slake their thirst to explore the wide horizons than to take a three-year honeymoon around the globe. If more justification for such a noble quest was required, they would report on the wondrous and rapid developments in freight transport that were occurring between 2002 and 2005.
The result is this compilation of articles, columns and thoughtful opinions entitled Around the World in Freighty Ways, which is published today by Right River Press Ltd., of London.
Both Gavin and Alex are professional journalists and have extensive experience in the freight industry. Their travels brought much insight into the varied and often ingenious ways the freight industry coped with, and indeed facilitated, the remarkable expansion of trade and economic growth between 2002 and 2005. As Gavin comments, “The humble container has done for globalisation what Alexander Graham Bell did for the internet – made it possible.”
The couple’s adventures however encompass not just freight experiences but also a variety of tales and a breadth of encounters that enable an astute, insightful and sometimes irreverent view on bureaucratic incompetence and political ineptitude. Many are laced with passionate descriptions of social inequality and gallant struggles for survival.
However, it is the similarity of basic human characteristics that shine through time and again as the episodes unfurl. As Gavin points out, it may in fact be the good fortune of people whose business it is to move freight around the world to recognise that, “Regardless of nationality, the vast majority of people share the same ambitions, hopes and fears, and that for most, joy and contentment comes simply from being nice to each other.”
Port Technology International’s article is perhaps poignant to current logistics developments in South Africa. Optimisation at the terminal does not only mean improving productivity and reducing operational costs. Optimisation represents a new approach to managing container terminals; it is the most significant driving factor in changing the traditional operational approach and methodology applied at container terminals. It also allows terminals to have a focus on efficiency which needs to address the trade-off between vessel service time, terminal capacity, and cost per move.
In terms of the marine shipping industry, one of the most accurate definitions of optimisation is: “The act of making a system, design or decision as effective or functional as possible.” Optimisation as a discipline is an ancient science best illustrated over time.
The history of optimisation
Greek mathematicians used to solve optimisation problems related to geometrical studies. After the invention of calculus, mathematicians were then able to address more complex optimisation problems. Following the start of the World War II and the advent of the operations research field, the concept and practice of optimisation began to develop and received significant academic and industrial focus. Mr J. Von Neumann, a leading individual behind the development of operations research, contributed substantially to the field of algorithmic research. And in the 60s and 70s, complexity analysis began to further support the use of optimisation. Then, in the 80s and 90s as computers became more efficient, algorithms for global optimisation with the purpose of solving large-scale problems began to gain momentum and credibility.
Considering the present
The continual advancements in technology with respect to computing power along with significant research in applied mathematics and computer science have solidified the value of optimisation to the industry and the end user. This has enabled advanced theory to be applied in a way that has sometimes invisibly improved our lives during last 20 years. The progress is amazing. Today, companies such as UPS and Federal Express utilise complex routing algorithms for resource allocation and supply chain distribution to deliver an item to our door with seamless efficiency. Their results have in turn changed the way millions of us find information, shop, and even do our jobs.
Today, many industries use optimisation as a more general term that covers areas from manufacturing process efficiency to improved distribution techniques. The core objective of optimisation is improving and controlling the process – whatever it may be – and allowing people with responsibilities in those areas to make better decisions. Operations research, for example, is a discipline that deals with the application of advanced analytical methods to help make better decisions at the right time and within the time constraints of a live operation.
As with other industries, the shipping and container space is currently going through its own step change to achieve new levels of operational productivity in response to mega-trends, such as globalisation and sustainable operations. To compete, ports and terminals have decided they need to adapt to their changing demands by optimising their activities in areas such as berthing allocation, vessel planning, fleet size optimisation, shift resource planning and equipment scheduling. All of these areas are critical for minimising the cost per move factors and maximising overall terminal performance and throughput.
Optimisation also provides the intelligence and the tools to support this changing industry, but it is not meant to be a black box. A container terminal is a very complex system with many unpredictable variables. Those focused on achieving optimisation will need to be able to control, monitor and configure the behaviour of this intelligence behind the machine and systems, filling any critical gaps between the planning and execution.
Containerised cargo makes up about 60 percent of all dry cargo trade in the world; since the advent of the cargo container more than 50 years ago, this number continues to grow. The appeal of containerised cargo is well known – cargo can be seamlessly transported from origin to destination via a variety of modes without the need to unload and reload its contents. The marine container terminal is at the junction of water, rail and truck transport modes. And as a consequence, marine container terminals are some of the most essential, yet challenging, links in the global supply chain. Source: Port Technology International
Currently an estimated 25 percent of all containers shipped by road, rail or inland shipping are empty. Empty containers are returned to the owners and subsequently shipped directly back empty into the hinterland.
This results in extra costs, inefficient and unnecessary transport and also affects the environment. InlandLinks claims to have achieved a breakthrough in terms of efficiency and sustainability for the entire logistical chain.
The new online application to reduce the transport of empty containers, called ’empty depot tool,’ inland terminals where shippers and logistical service providers can pick up and deposit empty containers, and later reuse these containers for a new load. The new method allows containers to remain on the inland terminal to be reused for export cargo, instead of being returned empty.
“It is not mandatory to bring containers back immediately but the owners of the containers, the shipping companies, normally want to reuse them as soon as possible,” said Sjaak Poppe, spokesman of the Port of Rotterdam.
“Currently oweners let containers return empty if they stay in the hinterland too long. The longer containers remain unused, the larger the needed amount of containers for shipping companies will be.”
With the new tool leads to lower costs and lower CO2 emissions. A large number of shipping companies have already joined the platform, Poppe added. Source: news.xinhuanet.com
The following piece suggests that the realisation of AEO obligations on shippers is real and will be augmented by support systems that may marginalise the highly competitive freight forwarding industry. While there is a suggestion of cost savings due to non-reliance of shippers on traditional forwarding agents, I believe this is a short-sited view as the ‘real challenge’ lies in whether or not shippers are up to the task in meeting these obligations given their unfamiliarity with customs and transport requirements. I see many shippers having to recruit experienced customs and forwarding experts to maximise their compliance given the burgeoning obligations materializing in international shipping!
In October 2011, Aircargoshop an online booking portal provided shippers the possibility to book their own airfreight without involvement of the traditional shipping agent via the online portal Aircargoshop. This is a development that might have important consequences for the closed airfreight industry. As a consequence the online booking portal offers a lower-priced, more efficient and more transparent process for aircargo booking.
Founder Paul Parramore of Rhenus Logistics suggests that this system will bring down the cost of airfreight by as much as 50%. The Dutch Shipping Council EVO, gave the system the thumbs up and said that it will revolutionise the manner in which the freight business is currently being conducted.
Joost van Doesburg, a consultant with EVO said that in the long run restructuring of the industry is necessary in order to meet the challenges of the 21st century. Many of the forwarders will lose out, but the system is geared towards cost effectiveness and being competitive. He also added that if the forwarder is to add value to the supply chain, then he has to comply to adapting to the system rather than working against it.
On the home front, a recent article featured on the website Freight into Africa reports that the South African Cross Border Transporters Association (SACBTA) will be introducing a similar system which is currently under development for the cross border road freight industry. It will be called “ROAFEonline” or shortened form of Road Freight online which will allow the customer to book directly his freight with accredited SACBTA members hence cutting out the middleman and brokers.
All payments can and will be done online and this system will integrate with SARS EDI (Would like to hear more on this!). The consignor will only have to ensure that his goods are loaded onto the truck, the rest will be done by the system. The cost per transaction to the customer will be a paltry R100.00 in relation to a few thousand Rands normally swallowed up by the middlemen.
Based on our estimations a regular consignor can save up to R3-5 million Rands per annum which hopefully will be passed onto the consumer. With the looming integration of the SADC countries towards one stop clearing, it makes sense to further integrate the system. So whether you are in Dar es Salaam or Lubumbashi, you can now book your freight from Cape Town without having to go through a string of brokers. You also have the assurance that your cargo will be loaded by an accredited SACBTA transporter who complies to the standards set out by SACBTA. It will facilitate consolidations as any accredited transporter will at any given time be able to see what cargo is available. If Transporter A has only 20 tons, he can check which other transporter on the system has another 8 tons to Dar es Salaam for example. The transporters can then consolidate a load on the system which will happen in a shorter period of time than say for instance waiting a month to fill a tri axle.
This system will have many other functionalities that have been incorporated like online tracking, bar coding, which will give the consignor and consignee piece of mind knowing at any given time where their cargo is. It will also be accessible to border agents and customs officials who will be in a position to extract vital information on any consignment long before it actually gets to a border.
The system will go into testing around March of this year and if all goes well should be ready for implementation by the latter part of 2012 or early 2013. We hope that this will go a long way towards restructuring the industry for the better. It has long been the desire of SACBTA to allow industry players to come on board to create a better industry. However, there has been very little interest shown in transforming the industry and we feel this system will by virtue of its nature, transform the industry whether industry players are willing participants or not. Source: Freight into Africa and various own sources.
The International Association of Ports and Harbours (IAPH) has joined the World Shipping Council (WSC) and International Chamber of Shipping (ICS) in urging the International Maritime Organization (IMO) to establish an international legal requirement that all loaded containers be weighed at the marine port facility before they are stowed aboard a vessel for export. In what has been a much publicized issue since 2008 in the maritime industry, much the same view is taken by customs administrations. Like many other changes in the supply chain, it is a lot easier said than done. Modern ports are designed and developed taking into account requirements for weight bridges, radiation portal monitors, networks to monitor vehicle and container movements in and around port precincts, and inland transportation routes. While the expense and budget for these are usually borne by the relevant port authority, would it not indeed be good if those responsible for the packing/stuffing of containers took it upon themselves to ensure the correct weight, quantity and content are properly declared?
Refer to the joint WSC/ICS paper on “Solving the Problem of Overweight Containers” as well as the ICS’s “Safe Transport of Containers by Sea”. Both are self explanatory and short enough so as not to be considered laborious. In the South African context the question of who packed the box is often unanswered given that a variety of entities could be involved in this activity. In some instances it could be a container depot operator or a freight forwarding and consolidation agent; depending on how ‘safety and compliant conscious’ the shipper wants to be. While it will still take some time before the entire supply chain becomes properly regulated and monitored, now’s the time for ‘operators’ to take stock of what might in future be a new standard. New standards mean more capital outlay with pass-on costs for which the shipper ultimately carries the can.