December 26, 2013

Sleight of tongue

Lloyd’s List has rolled out a list. Recently published, the ‘Hundred most influential people in shipping 2013’ ranks the global maritime elite. Listed, in descending order, are shipowners and executives, energy czars and mining billionaires, crude oil exporters and shipping financiers, Walmart and Cosco, Indian Mukesh Ambani and Norway’s John Fredriksen, aggressive Greek magnates and risk-taking European mavericks, terminal managers and charterers, IMO’s Kozi Sekimizu and VShips’ Roberto Giorgi, vetting group Rightship and salvage company Titan- amongst many, many others. There is even- as has been since 2010- a Somali pirate on this list, although there is a new representative of that ilk this time and the ‘pirate’ spot has been demoted to number 90.

And in what appears to be a cruel joke, but is probably well meant, is that at number one, topping the list of the ‘Hundred most influential people in shipping, 2013’ is ‘The Seafarer.’

Now one could stretch imagination and insist that a seafarer is most influential because she or he is at the front line and, so, the final executor of whatever is planned. I don’t buy this, because the same reasoning applies to any industry (but, for example, we don’t go around saying that the bricklayer is the most influential person in the real-estate industry, do we?)

Besides, influence implies power. To therefore pretend that seamen- the most powerless group in shipping bar none- are influential is almost breathtaking in its inaccuracy.

“Seafarers ultimately must be applauded for their service to society,” says Lloyds’ List, with reference to the top ‘influential’ spot. I respectfully disagree again. Seafarers are professionals working in a job for money. Nobody goes out to sea to serve society and even seamen don’t expect this kind of hypocritical applause. In any case, I haven’t seen a single seaman shedding a single tear because society is not applauding him.

The whole treatment of seafarer issue has been badly warped and mutilated. I have seen the industry carrying on with its ill treatment, abusive neglect, abandonment and disrespect of seamen for almost four decades. Little has changed except for the worse. The additional sword of criminalisation that hangs over many seagoing heads today does not make a seaman feel powerful and trite phrases like ‘seafarers are our best assets’ that spew out of the mouths of the truly influential people in shipping do not fool a seafarer an iota. In fact, they make a laughingstock of those who speak that tosh.

This industry behaviour is widespread and schizophrenic. It is deeply patronising and an insult to every seafarer’s intelligence when we say that she or he is the most influential person in shipping.

In case the truly influential are listening, let me say this. Seamen usually have very good bullshit detectors; it goes with the territory. They may be the least influential, but they know crap when they smell it. They don’t give a rat’s behind about being applauded by society or being acclaimed as your ‘best assets,’ as if they were silicone implants.

Most seafarers would like to be treated as valued human beings by the industry. Not the most valuable, just valued. Treated with dignity. They know- even without the truly influential telling them repeatedly, and how many times have we heard this, too- that working on a ship is not rocket science. They know, too, that most rocket scientists- and many of those who try to belittle them for their own piddling and puny agendas- would not be able to do what they, the seamen, do.

The flip side of all this is that seafarers have become thickened to industry behaviour, and, in turn, don’t really care for shipping’s long term welfare. They care enough to want to see their next few contracts secured, of course, but not much beyond that. They have been here long enough; they know the game and the way it is played. They know that only fools get taken in by sleight of tongue.

Those who sail do not have enough influence to even guarantee that their wages will be eventually paid. They risk, as Thomas Brown of Seacurus says, becoming cash flow casualties of their employers' insolvencies. Yeah, yeah, the MLC addresses this. Or not, as the truly influential say, claiming that abandonment repatriation is covered but wages are not. Or wait… we will have tripartite talks (unions, owners and governments) in April next year to see what we can do about this annoying thing. We will do what we have always done: use delay and obfuscation to try to avoid giving seafarers what is their basic right.

Seafarers the most influential people in shipping? Horse manure. Not surprising, then, that every time somebody says ‘best assets’ or every time somebody refers to this year’s Lloyds’ List’s top 100 ‘influential’ rankings, I hear, in my mind, a reverberation – a booming and collective roar.  

That eruption sounds angry, but it isn’t. It is just the sound of the collective peal of laughter of the one point three million seafarers out there. 


December 19, 2013

Brewing boxship bloodbath

The P3 alliance is in the news again- another step forward towards the likely eventual cartelisation of large segments of shipping. What is happening in the box trade today- massive ships, player consortiums et al- will be replicated elsewhere pretty soon, I think. These alliances will threaten to destroy operators lower down the food chain.

Starting mid-2014, the P3 Alliance- between the top three container giants Maersk Line, CMA-CGM and MSC- will together start operating well over 250 vessels (a seventh of global capacity) with the ability to move a staggering 2.6 million TEUs. The Alliance will then control 42% each of the Asia-Europe and the trans-Atlantic box trade and a quarter of the trans-Pacific container trade. Many of the largest ships in the world will be positioned on these runs; the Alliance will also share extensive port facilities that each member has access to, or has a stake in. 

On the eastern side of the world, members of what we know as the G6 Alliance– Hapag-Lloyd, OOCL, NYK, APL, Hyundai and MOL- are planning to take the P3 guys on with a total of 118 ships of their own, either on the Asia- US West Coast run or on five transatlantic loops. 

Although the P3 Alliance has raised some hackles and resulted in the U.S. Federal Maritime Commission calling for a meeting with European and Chinese regulators to discuss cartelisation and unfair advantage, I doubt that this is going to stop them. For one, the EU seems to be behind the alliance as they see it as a deal made by European firms. Interestingly, each of the three P3 member companies has been under investigation, at one time or another, for price fixing by the European Commission, judging from reports.

My oft-stated opinion that the near future is going to see a consolidation in shipping that will kill smaller players will probably be tested by the slaughter that I think we will see, over the next few years, in the box trade. 

Leaving cartelisation aside for a moment, the biggest risk to trade is the possibility that another global recession is going to hit us soon. Market pundits like Jim Rogers and Marc Faber are repeatedly saying that the next economic collapse is a certainty. That it is a question of when and not if; that the profligate policies of countries across the world spearheaded by the US’ Quantitative Easing have made the next collapse inevitable. 

Even if that view is alarmist, the fact is that container shipping is in a bad place today anyway. The order book is severely bloated - 55 large ships will be delivered this year, 40 are due next year and another 45 the year after that. Each is in the 8000-10,000 TEU range. Do the math and you will begin to see some alarming capacity numbers.

 Not just that, but shipowners continue to order these large boxships; even smaller players, squeezed by the scale advantages the bigger shipowners presently enjoy (and perhaps looking at the fact that Maersk and CMA CGM have outperformed other boxship owners) continue to order these behemoths. 

Then there is the problem of what I call hidden capacity. Earlier recessions used to result in ships laid up- ‘cold’ or ‘hot.’ With slow steaming, that has changed this time around. There is, today, massive container tonnage sailing at slow speeds around the world. And huge boxships- all relatively new- are operating at considerably less than full capacity. All the time.

Whenever trade picks up significantly, there will be this large ‘hidden capacity’ ready out there- ready to increase speed whenever faster voyages become worthwhile. This will mean, effectively, that hundreds of thousands of additional container slots will become available to the market. The direct and indirect impact of the release of this hidden- and readily available- capacity can well be the final nail on the already hammered coffin of an industry that is struggling to remain profitable. 

All of the above- overcapacity, hidden capacity and present near-reckless pursuit of large new builds included- were going to end up in an oversupply nightmare even without the P3 Alliance or the G6’s retaliatory moves. With those in the pipeline, things can well become much worse. Forget small container shipowners, even second rung ones will be squeezed extremely badly. 

How extemely? I dunno exactly, but the word bloodbath comes to mind.


December 12, 2013

The Icarus Agenda

About two weeks ago and not long after the next generation of broad-based economic reforms were announced in China, Beijing’s Ministry of Transport said that it had submitted a proposal to make development of that country’s shipping industry a ‘national strategy.’  Some Indians will probably say, in response, that their Ministry of Shipping launched the ‘Maritime Agenda 2020’- a 450 page comprehensive document for the growth of the maritime sector- almost three years ago, so what the hell is special about the Chinese statement?

The difference is that history tells us that the Chinese- if their MoT’s proposal is approved- will probably deliver on the ground with their proposed plan. India, on the other hand, will probably fail to do so with its Maritime Agenda 2020, an apprehension that the three years since its promulgation have done little to dispel.

On the other side of the world, the United States is struggling with aging infrastructure on its water transport routes and is finalising a new waterways bill to, amongst other things, find resources to overhaul its 12,000 mile long inland waterways, many with expansive (and expensive to maintain) lock systems.  Critics say that the legislation has been delayed; the U.S. traditionally passes water resource legislation every two years. That level of review is unthinkable in India, where a key file may not move to the adjacent clerk’s in-box in that much time. Unless, of course.

History reassures us that the US system will probably deliver, too.

The Indian Maritime Agenda 2020 had declared grandiose intentions, including an investment of Rupees 1,650,000 million in the sector. Our ports to be on par with the best in the world. Increased Indian tonnage and share of Indian ships in the country’s trade to rise significantly, with State owned ship owner SCI spearheading new acquisitions. Promotion of coastal shipping and inland waterways. Indian global shipbuilding market share to jump to 5 per cent. A new dredging policy. Shifting of transhipment of Indian containers from foreign ports to Indian ports. Establishment of an Indian P&I club and freight exchange. Collaboration of the Indian Maritime University (IMU) with top global academic institutions in the maritime sector. New legislation and a slew of amendments to existing legislation. And an increase of Indian seafarer market share to 9 per cent from the then estimated seven, and this one by 2015. This is almost next year.

The stunning lack of progress after the official publication of highfalutin policy documents is nothing new in India, so nobody will be really surprised that the progress made since the proclamation of the Maritime Agenda has been piddling, at best. Worse, nobody seems to care than 2020 is just six years away.

Not that absolutely nothing has been done, but, overall, all of it is too little and too late. Baby steps have been taken in, for example, a national waterway that will transport coal to Farakka from Sandheads in the Bay of Bengal. Some port investments have been made that make sense (amongst many that don’t). Tinkering with the Cabotage law is on once again to try to support Indian tonnage. But nothing that I have seen points to any concerted action that has more than a snowflake’s chance in hell in meeting even a third of the Maritime Agenda’s aims.

All in all, the Agenda is failing on most counts. In contrast to its aims and claims, the idea of Vallarpadam- that was to take on Colombo for Indian transhipment cargo- has failed thus far; there are few takers for the Indian terminal. Then, there is little to cheer the languishing Indian shipbuilding sector. Also, though some private ports are doing well, how many Indian ports are really world class?

There is no chance that India is going to dramatically increase global seafarer market share in the next two years; in fact, a  decrease seems more likely in future.

SCI is in no position to spearhead anything; it is, in fact, fighting to keep its Navratna status. It would have been fighting to survive bankruptcy if it was a private entity.

Our dredging is in disarray- and let’s not even talk about the Sethusamudaram project, please, which is an abject lesson in how a fortune can be flushed away in India for all the wrong reasons.

And the IMU is mired in allegations of corruption, infighting and worse.

Critics will say that Indians are good planners but poor executors. I don’t buy that argument; we seem to execute well enough when we are outside the country. Others may point to the lack of democracy in China as a reason why policy can be backed up by action easily there; I don’t buy that either, because they are enough democracies out there that implement, more or less, what they plan.

I think, instead, that we fail because we are particular victims of corruption and its incidental fallout. Particular, because although corruption exists across the globe, it is special in India simply because it is overarching and, like God, it is everywhere. Indian corruption is particular since it paralyses every plan and promotes  third rate execution because competence is invariably slaughtered at the altar of greed. Only inefficiency and helplessness survive, with their convenient and ready excuses for failure. We declare pompous agenda’s with the foreknowledge of how deep the rot is and the inner surety that we are going to fail.

Declarations of intent must have teeth behind them. Clean teeth. Navigable waterways are a country’s geographic resource and shipping its lifeblood. India fails to realise that shipping is vital to its economic well-being. Jingoists will claim that the Indian Ocean is the only ocean named after a country; that it hosts 100,000 transiting ships annually. That two-thirds of the world’s oil, one-third of all bulk cargo and half the world’s container traffic pass through these waters.

All that is fine, but that false feel good sermon is not a panacea. It is not even a placebo, actually, because it does not even give the impression that it is working.

To accomplish anything- anything at all- one has to execute. If one cannot do that, or if a nation’s ability to execute is crippled by a complete absence of a moral or ethical compass, then what happens is that any national agenda is just another overblown statement that disintegrates when it collides with reality. 


December 06, 2013

Song and Dance

Published somewhere in November

The maritime press is going the way of the tabloids. 

One widely circulated ‘news’ piece- that Britney Spears’ music is being used off East Africa to ward off pirates- is to me flippant, mildly titillating and largely obfuscatory all at once. It appears that Somali pirates hate the lady’s music, seeing it no doubt as symptomatic of Western decadent culture. Or so say some members of the British merchant navy, who are blasting the eardrums of those aboard approaching pirate boats with Britney’s music. “As soon as the pirates get a blast of Britney, they move on as quickly as they can,” says widely quoted Rachel Owens, a merchant marine officer. Ms Owens does not say what effect Britney’s screams have had on her shipmates and their presumably Western eardrums, or, indeed, on the schools of fish in the Indian Ocean that are being tortured by Spears’ music as surely as the detainees in Guantanamo were (are, still?) tortured with Metallica’s rough rock and Bruce Springsteen’s ‘Born in the USA’.

What is largely unreported in all this tamasha is the fact that each one of the ships that are blasting ‘Baby one more time’ have armed security teams aboard. So, even as the tabloids and mainstream newspapers in the UK and the copy and paste journalists everywhere else go to town with little content but wildly inaccurate headlines (Spears harpoons pirates, anybody?), security teams aboard ships will shrug off the hoohaa and concentrate on keeping their powder dry. Britney Spears is probably a pirate irritant at best and an overrated singer at worst; she can screech loudly, but those who sail must carry a big stick. 

The other piece of titillating news from last week is actually more serious. At the trial of Costa Concordia’s Capt. Schettino in Tuscany, twenty-six year old Moldovan dancer Domnica Cemortan broke down under cross examination- and, after being warned three times by the judge against perjury- admitted that the two had been lovers aboard the ill-fated ship. 

Domnica had denied the affair for two years, presumably in a bid to protect the married Schettino or to save her and her young child embarrassment. Her ‘revelation’ went semi-viral too, with many adding a mean aside -talking to a translator, Domnica had brushed off the fact that she didn’t have a ticket for the ill-fated Concordia cruise- “When you are somebody’s lover, they don’t ask to see your ticket,” she had said. That aside became public after the judge insisted it be translated in open court.

What went under-reported was her dismaying testimony that Schettino was dining with her at a ship’s restaurant just fifteen minutes before the Concordia hit the rocks. This, combined with the fact that Domnica was on the bridge with the good Captain when the Concordia actually ran aground, is pretty damning for Schettino. The allegations that he was cavalier in his navigation and unmindful of safety will resurface with a vengeance now. 

Many cargo ship Captains ban families (including their own) from the bridge during sensitive manoeuvring times; they do not want the bridge team distracted. I have called Civitavecchia (the Concordia’s port of departure) often, and, without second guessing the events of that fateful night, I will only say this: I would not be dining with a Moldovan dancer fifteen minutes before I planned a dangerous ‘sail past’ close to an island off that coast. Hell, I wouldn’t be even dining with my wife. I would not tolerate, in darkness when situational awareness is always a bigger issue, any unnecessary personnel on the bridge. And I would not be comfortable below deck so close to a potentially dangerous manoeuvre.

I am sure Captain Schettino- charged with manslaughter, causing a maritime disaster and abandoning the Concordia- will agree with me today. Regardless of the outcome of the Tuscany trial, his errors of judgement will torture him for a long time, I am afraid. Shipmasters will tell you that Britney Spears’ wails are nothing compared to the torture that the what-if’s of their rank inflict upon them. 



The following editorial was published somewhere last month, in the beginning of November. Anyway.

December 05, 2013

The map is not the territory


When Flemish cartographer Gerardus Mercator published his first world map in 1569, the reason for doing so said it all- "(A) New and augmented description of Earth corrected for the use of sailors," is how he described it. The poor guy could not have dreamt that his projection of the earth’s surface on a flat piece of paper would cause, four and a half centuries later, sporadic expressions of distress and accusations of conspiracy.

Navigators may skip this paragraph; for the others, a brief explanation of the ‘Mercator’s Projection’: Imagine the earth’s surface as the peel of the orange above, the planet’s longitudes represented by the ‘longitudes’ on the peel that converge at the North and South ‘poles.’ Now, imagine that you pressed that peel flat upon a table and made the ‘longitudes’ parallel to each other by stretching them out. You would then have a Mercator Chart (except that is actually done a lot more mathematically!). There are distortions of the parts of the earth, obviously, by virtue of the longitudes requiring to be stretched apart to make them parallel, except at the equator. This stretching automatically also stretches, on that chart, the land or water masses between longitudes. These distortions increase with latitude (since greater stretching is required away from the equator) and are maximum at the North and South Poles.

For many reasons mainly to do with courses, bearings and loxodromic curves, the Mercator Chart was ideal for sea navigation; the vast majority of navigational charts use that projection even today, as we know. The problem, if there is one, arose when Mercator’s projection began to be used widely for making maps of the earth and became incrementally commonplace; it remains the most popular projection for all maps. Its success has meant that the Mercator map is what most of us visualise when we think of the world, nations- or their size. Our mental conception of the world is based on the Mercator projection, and this is problematic. This is what is criticised.

For, amongst other things, land masses like Europe that lie in higher latitudes appear much bigger than they actually are- because they have been stretched more on the map - while nations in the lower latitudes suffer little distortion, and so appear much, much smaller. And therein lies the rub, and fodder for Mercator’s critics, who see a great European conspiracy in the fact that Africa is the same size as Greenland on a Mercator map whereas in actual fact Africa is 14 times larger. North American and European regions similarly ‘benefit’- Alaska is a fifth the size of Brazil but takes equal space on that map. These critics say that the Mercator Projection is a result of colonial influence- even conspiracy- downgrades the size (and, presumably in our size-matters mind set, also downplays the importance and culture) of countries in Asia, Africa and Latin America that lie closer to the equator, while bloating the sizes of countries in Europe and North America- and their importance.

Frankly, I think that the conspiracy theory is balderdash, mainly because the fact is that the Mercator chart was rolled out because it was the most practical projection for seagoing navigation; it still is, except near the North or South poles (where distortion is infinite).  Mercator did not formulate his projection to make a map of the world. The fact that a lazy world dominated by Europe at the time did nothing to correct the widespread use of maps using this projection (repeat maps, not nautical charts) does not make any difference to this fact. The fact that many of the countries that suffer from Mercator’s distortions are former colonies is a coincidence. The fact that many of these countries are poor and less important today is because European colonisers looted and pillaged them for centuries, not because a European guy made a damn good nautical chart.

So move along, move along; there is no conspiracy here.

Cartographers criticise Mercator’s Projection too for reasons to do with accuracy, pointing out that other projections exist that distort less. They ignore, sometimes, the fact that any projection of the surface of a spheroid on a flat piece of paper will distort some attribute or the other. There can be no ‘accurate’ map of the earth, in that sense. It is more a question of what kind of distortion is acceptable for what that piece of paper is supposed to be used for. A Mercator chart is supposed to be used for navigation. It has proven itself fit-for-purpose. It ain’t broke; don’t fix it.

It is not Mercator’s fault that the world took his projection and started teaching geography with it.