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Issue #591

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Terminal Operators

Air Cargo Quarterly

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2014 Media Kit

Shaking up ocean transportation: How much difference will 53-foot containers make?

By: | at 07:00 PM | Breakbulk & Projects  

By Peter A. Buxbaum, AJOT

Just last month, APL announced that its first consignment of 53-foot ocean containers were rolling off the assembly lines in China and being loaded with goods for eastbound transpacific voyages. APL’s introduction of these new, oversized ocean containers raise some interesting questions.

The so-called Ocean53 boxes will almost certainly not change international ocean shipping overnight. APL is deploying only a few hundred containers, hardly enough to transform logistics right now.

What if the boxes catch on? What advantages and disadvantages do they pose? Will shippers and intermediaries be scrambling to get their hands on them?

A number of factors led APL to begin actively developing the Ocean53 containers eight months ago, according to Bob Sappio, senior vice president for the transpacific trade at APL. ‘First and foremost, we were responding to customers who want greater efficiency in containerized trade,’ he said. ‘They can now use 53-foot containers from origin to destination, eliminating the expense and delay of transloading.’

APL was also driven by the challenge of supply chain congestion, Sappio added. ‘Two Ocean53 containers hold the contents of three 40-footers, so there should be fewer containers to handle and fewer moves,’ he explained. ‘We also saw an important environmental benefit to the Ocean53. By cutting down on transloading and reducing the number of truck moves, traffic and exhaust emissions can be curtailed.’

Most industry observers see more advantages than disadvantages to APL’s innovation. At least one, however, expressed skepticism over the effect the Ocean53s will have, even on the practice of transloading.

‘As the majority of containers deployed in the international lanes are 20 and 40 feet and as the 53-foot container has mainly been used domestically, shippers had to frequently resort to transferring cargo at the U.S. ports from the ocean containers to the domestic 53-foot containers and vice versa,’ noted Joseph Abboud, director of ocean services at SEKO, a supply chain management company. ‘With the introduction of the 53 foot ocean container, the shippers will no longer need to reload cargo at ports and thus will be saving costs and shorten the total transit times.’

‘I don’t foresee any problems,’ added Ted Prince, chairman of the Intermodal Association of North America. ‘The logistics chain is completely independent of box size. That is whole point of logistics chain. We can handle 53-foot containers or charter a 747.’

If the 53 footers make it in a big way, they could pose some challenges to those who operate in the transpacific lane, others say. ‘Over time, if a significant number of these 53-foot containers are introduced into the transpacific market, they could have an impact on the economics of the trade,’ said Owen Kelly, global account executive at BD Transport, LLC. ‘Big box retailers will be attracted to the concept.’

Kelly added that a ‘barrier to the large containers becoming a dominant force is the fact that they must be stowed on deck, and most ship capacity is below deck.’

There are other advantages and disadvantages associated with the large-scale adoption of Ocean53s. For Mary Jo Muoio, senior vice president of Barthco International in Boonton, N.J., the introduction of significant volumes of 53-foot ocean containers could mean fewer container moves, or at least a reduction in the growth of container moves, thus addressing current capacity constraints.

They could pose problems in warehouses and on the highways. ‘Warehouse and highway designs with limited maneuverability and size and weight restrictions could limit the use of these larger containers,’ said Muoio. ‘Domestic warehouses may need to be altered to allow for the larger containers and inland transportation moves may need to be rerouted to legally move the containers over U.S. roads and rails.’

Muoio added that, ‘‘the steamship lines will have to purchase chassis for these containers and where limitations exist, re-design the