shipping
Newsletter
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Mississippi River's low water levels hurt farmers shipping grain
For the third year in a row, unusually low water levels in the Mississippi River are causing barge companies to limit their cargo, reducing farmers' profits as they ship grain to international buyers.
In short:
- Low water levels in the Mississippi River are forcing barge companies to limit their loads, especially impacting grain shipments.
- Grain freight costs from St. Louis and Memphis are sharply higher compared to last year and the three-year average.
- The U.S. Army Corps of Engineers is frequently shifting dredging operations to address the situation.
Key quote:
“When you’ve got a transportation cost increase in any industry the question is, ‘Do I pass those costs onto the customer in the form of a higher price?’”
— Mike Steenhoek, executive director of the Soy Transportation Coalition
Why this matters:
Low water levels on the Mississippi River threaten the efficient transportation of U.S. grain exports. As freight costs rise, farmers can't easily pass on these costs in global markets, impacting their livelihoods.
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New study reveals Arctic sea ice complicates shipping routes
Melting sea ice in the Canadian Arctic is paradoxically making shipping routes more hazardous due to the movement of centuries-old thick ice, according to recent research.
In short:
- Melting thinner ice is releasing thick, old ice, creating choke points in the Northwest Passage.
- The study, reflecting actual ship traffic from 2007-2021, shows increased risk on key routes, despite longer shipping seasons in some areas.
- Local coastal communities face increased food and supply costs due to shortened shipping seasons and reliance on costly airlifts.
Key quote:
"It's true that the Arctic sea ice in general is showing significant retreat and melting, and will continue to do so, but our new study shows that it's not a simple story."
— Alison Cook, Scottish Association for Marine Science
Why this matters:
Thick ice obstructing Arctic shipping routes poses economic and logistical challenges for coastal communities, increasing their dependence on expensive airlifts. Additionally, this complicates future plans for using the Northwest Passage as a reliable trade route, affecting global shipping logistics.
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Credit: Justin Wilkens/Unsplash
Biden aims to revive Mississippi River transport to reduce emissions
President Biden plans to modernize Mississippi River transport with $2.5 billion to cut emissions, but environmentalists raise concerns.
In short:
- Biden's administration has allocated $2.5 billion from the bipartisan infrastructure law to upgrade river transportation.
- Transporting goods via barge uses significantly less fossil fuel compared to trucks and trains, potentially lowering greenhouse gas emissions.
- Environmentalists warn that river infrastructure projects may harm fish and wildlife and dispute the efficiency claims of river transport over other methods.
Key quote:
“There is a lot of myth around inland navigation, a lot of romanticism, that really doesn’t bear out.”
— Olivia Dorothy, restoration director, American Rivers
Why this matters:
Transporting goods via barge offers a greener alternative to traditional methods like trucking and rail. Barges consume significantly less fossil fuel, which could lead to a substantial reduction in greenhouse gas emissions. This efficiency makes river transport a seemingly attractive option in the fight against climate change, aligning with the administration's broader environmental goals
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Uncertain weather forecasts are raising grocery costs
Predictions of extreme weather events are increasingly affecting food prices, driving up costs even before actual climate shocks occur.
In short:
- Weather forecasts can prompt food manufacturers to raise prices in anticipation of supply chain disruptions.
- Increased costs in production and transportation due to extreme weather are often passed on to consumers.
- The resilience of the food supply chain mitigates some impacts, but rising frequency of climate events threatens stability.
Key quote:
“When it comes to the climate risk on food prices, people typically look at the production side. But over the last two years, we learned that extreme weather can raise food prices, [cause] transportation disruptions, as well as production disruptions.”
— Seungki Lee, agricultural economist at Ohio State University
Why this matters:
As meteorologists warn of potential droughts, floods, or hurricanes, commodity traders react swiftly, often raising prices and premiums to mitigate perceived risks. These preemptive hikes ripple through the supply chain, ultimately reaching consumers who are already strained by rising costs.
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Shipping industry seeks sustainable fuel alternatives
The shipping sector is moving away from heavy fuel oil to greener alternatives in response to stringent global regulations.
In short:
- New regulations by the International Maritime Organization require significant emission reductions, prompting the search for sustainable fuels like methanol, hydrogen, ammonia and experimenting with electricity and nuclear power.
- Methanol shows promise due to renewable production methods, but challenges in global availability persist.
- Ammonia emerges as a strong candidate despite its toxicity, with ongoing developments to improve its combustion efficiency in maritime engines.
- However, the industry needs to look at other ways to cut down emissions, like wind-assisted technologies.
Why this matters:
Transitioning to cleaner fuels is important for the shipping industry to meet upcoming emission reduction targets, which are set to become net zero by 2050. Success in this industry could set a precedent for other sectors, pushing them towards their own environmental commitments.
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Wind-powered sails modernize cargo shipping to reduce emissions
Cargo ships are increasingly adopting advanced sail technologies to decrease fuel consumption and carbon emissions, leveraging designs inspired by airplane wings and enhanced with artificial intelligence.
In short:
- Sails resembling airplane wings and equipped with AI optimize wind usage to propel ships, minimizing reliance on traditional fuels.
- Industry adoption is slow but growing, with 39 large ships already equipped and more anticipated as manufacturers ramp up production.
- These technologies not only reduce operational costs and environmental impact but also extend the lifespan of existing vessels.
Key quote:
"We’re going to see this coming very quickly to a larger number of ships."
— Matthew Collette, professor of naval architecture and marine engineering, University of Michigan.
Why this matters:
The shipping industry generates close to 3 percent of global carbon emissions. Wind-powered sails contribute to the industry's efforts to meet international environmental standards and targets, which includes halving greenhouse gas emissions from ships by 2050 compared to 2008 levels.
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Rivers take center stage in Europe's climate strategy
In a bid to slash carbon emissions, France's Seine River emerges as a vital player in a broader European effort to leverage waterways for freight transport.
In short:
- The European Green Deal aims to revitalize river transport, cutting road freight's carbon footprint by encouraging barge use over traditional trucking.
- France's main port operator, Haropa, is spearheading more than 1 billion euros in investments to make the Seine a model for eco-friendly freight movement.
- Innovations like electric and hydrogen-powered barges are on the rise, alongside initiatives by companies such as Ikea to reduce urban pollution and congestion.
Key quote:
"We are working on a transformation to get businesses to massively shift their logistics routes."
— Stéphane Raison, president of Haropa
Why this matters:
Rivers, historically central to commerce and trade in Europe, are being re-envisioned as arteries of sustainable transport. Barges are capable of carrying much larger volumes of goods compared to trucks, thereby improving efficiency and reducing the number of trips needed to transport the same amount of cargo.
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