Maersk to sail first container ship over top of Russia

Northern Sea Route touted as potential rival to Suez Canal for trade as Arctic ice melts

Melting Arctic ice has made the Northern Sea Route a more feasible option for large-scale trade. Photograph: Reuters

Melting Arctic ice has made the Northern Sea Route a more feasible option for large-scale trade. Photograph: Reuters

 

Maersk Line will this week launch the first container ship on an Arctic route over the top of Russia as the world’s biggest carrier of seaborne freight experiments with an alternative to the Suez Canal.

The Venta Maersk, a 3,600-container new ice-class ship belonging to the Danish group, will leave Vladivostok in the next few days bound for St Petersburg, which it will reach by the end of September.

The Northern Sea Route, which stretches from the Bering Strait between Russia and the US along the far north of Russia to its exit close to Norway, has been touted as a potential long-term rival to the Suez Canal for Asia-Europe trade as ice in the Arctic continues to melt.

This summer temperatures in the Arctic Circle have been unusually high, soaring above 30C in some parts.

The Northern Sea Route can cut the journey time between Asia and Europe by one to two weeks depending on the destination but is more costly, still requires nuclear icebreakers to accompany vessels and can only take smaller vessels than the Suez Canal.

Confirming a story by High North News, Maersk said in a statement: “The trial passage will enable us to explore the operational feasibility of container shipping through the Northern Sea Route and to collect data.”

It added: “Currently, we do not see the Northern Sea Route as a commercial alternative to our existing network, which is defined by our customers’ demand, trading patterns and population centres.”

The Danish group had tried to keep the maiden voyage, which will transport frozen fish, general cargo and some refrigerated produce along the route, low-key to avoid confusing customers. Its new ice-class vessels are set for service in the Baltic Sea.

Maersk’s former chief executive told the Financial Times five years ago it would be at least two decades before Arctic shipping routes would be a commercial option.

Many limitations

Arild Moe, senior research fellow at Fridtjof Nansen Institute in Oslo, said: “There are many limitations to large-scale container shipping through the Arctic. There is a lack of markets along the route; you cannot use it the whole year; and limitations on size, which is crucial for economies of scale.”

Russia has increasingly seen the NSR as a strategic asset for trade and geopolitical reasons, and has stepped up spending on Arctic defence to reopen mothballed bases or revamp others.

Novatek, Russia’s largest private gas company, last month shipped its first ever liquid natural gas cargo on a special LNG tanker through the NSR to China, a voyage that its owner Leonid Mikhelson said would begin a “new era” for trade routes.

Novatek believes that all-round shipments through the NSR will soon be possible using a new fleet of ice-breaking LNG tankers that will not require icebreaker convoys being developed by the company.

Cosco, the Chinese shipping company, has stepped up its use of the route in recent years using multi-purpose vessels to transport the likes of wind turbine parts and other heavy components, in a move that may have piqued Maersk’s interest.

Mr Moe said destination shipping such as transporting oil and gas produced in the Arctic was well suited to the NSR but that cross-Arctic traffic was a long way off. – Copyright The Financial Times Limited 2018