The business of moving perishables is innately unbalanced. The cargo carried by Ro-Ro ships is also frequently head haul heavy. Can a Reefer Ro-Ro vessel balance the two legs?
The Reefer Ro-Ro stands as one of the most original, intriguing and cost effective concepts in vessel hybrids. Now, if only it can be built.
“The savings are such that it should not take anyone long to design and build it, but with the present shipping industry in somewhat of a turmoil, people are hesitant,” said Ole Schack Petersen, chair of Reefer Intel AG, one of three companies that collaborated on the ship’s design and development. The others are Knud E. Hansen A/S and Stena RoRo AG.
The developers claim their new ship carrying bananas or pineapples one way and cars or project cargo the other would save operators anywhere from $15 million to $44 million a year over conventional container ships and reefers. The developers estimate a Reefer Ro-Ro ship would cost $45 million plus another $8 million for the reefer plant.
Overcoming a huge logistical flaw in trade flows is at the heart of the Reefer Ro-Ro: Many conventional reefers move cargo in only one direction and then have to return empty. That’s especially true with the Latin American banana and pineapple trade. At the same time, Ro-Ros moving cars to Latin America are either returning empty or taking a circuitous route back to where they can be loaded again. A Reefer Ro-Ro would marry the two, transporting fruit from Latin America to Europe and the US and then carrying vehicles on the return leg.
“It would hugely optimize the way that Ro-Ro cargos are moved from Europe and the US to Latin America,” Petersen claimed.
Developers believe the same pattern can be applied to ships traveling between Japan and Korea and Southeast Asian nations such as the Philippines, a major source of fresh fruit.
These days, containerized vessels move an increasing percentage of fresh fruit. That overcomes the basic cargo flow imbalance. But many ports in Latin America can’t accommodate the newer and bigger Panmax ships, so are at the mercy of feeders and then transshipped. This adds to the cost. Likewise, many Latin American ports can’t handle larger car carriers.
Developers believe that their new ship will be able to efficiently call on small ports.
For the Reefer Ro-Ro, the designers have devised what they call a moveable cassette that would hold fruit pallets and move to and from the ship by mafi-trucks. This would greatly accelerate loading and unloading time, the developers believe. The ship is designed to have hoistable decks, which allow 4.5 meters clearance. When only vehicles are loaded, the decks can be lowered to accommodate two layers of cars.
The Reefer Ro-Ro also offers space for refrigerated containers on deck.
This new design is also environmentally advanced and complies with new IMO regulations, in contrast to the world’s aging reefer fleet. The developers offer for the ship’s main engine a fully LNG fuel source as well as a hybrid heavy fuel oil and LNG.
Since the end of the 1990s, very few conventional reefer ships have been built, in part because shipping rates for their cargo dipped below operating costs. (That was in part the result of aggressive competition from container ships.) The world’s reefer fleet is now 26 years old and ship operators are reluctant to invest in updating reefer plants, lessening operating efficiencies. What’s more, by 2025, in many parts of the world, environmental regulations will require alternative propulsion. That will render the current fleet obsolete, Petersen believes, because the $5-6 million cost of a new LNG engine far exceeds the value of the ship itself.
The banana trade is booming, in part thanks to increased demand from China. In 2016, vessels moved some 18 million tons of bananas, representing half of the world’s refrigerated sea-borne fruit trade. The Reefer Ro-Ro developers are pitching their new ship design to multinational banana producers. The savings are obvious, said Petersen.
One answer, Petersen said, is a private equity fund, many of which have already invested in the maritime trade, although some have been burned by the prolonged downturn. “This is an opportunity for them to diversify their portfolio into another segment of shipping,” said Petersen.