Proposing a common platform of shipping cost analysis of the Northern Sea Route and the Suez Canal Route
Maritime trade between East Asia and Northwest Europe using the Northern Sea Route (NSR) has been recently increasing, because ship operators may take advantage of the shorter sailing distance of NSR whose navigable season has become longer because of retreating Arctic sea ice. As Arctic sea ice con...
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ftrepec:oai:RePEc:pal:marecl:v:17:y:2015:i:1:p:9-31 2024-04-14T08:07:10+00:00 Proposing a common platform of shipping cost analysis of the Northern Sea Route and the Suez Canal Route Masahiko Furuichi Natsuhiko Otsuka http://www.palgrave-journals.com/mel/journal/v17/n1/pdf/mel201429a.pdf http://www.palgrave-journals.com/mel/journal/v17/n1/full/mel201429a.html unknown http://www.palgrave-journals.com/mel/journal/v17/n1/pdf/mel201429a.pdf http://www.palgrave-journals.com/mel/journal/v17/n1/full/mel201429a.html article ftrepec 2024-03-19T10:25:42Z Maritime trade between East Asia and Northwest Europe using the Northern Sea Route (NSR) has been recently increasing, because ship operators may take advantage of the shorter sailing distance of NSR whose navigable season has become longer because of retreating Arctic sea ice. As Arctic sea ice continues to retreat because of global warming, the NSR is now approximately 40 per cent shorter than the Suez Canal Route (SCR) for such trade. In 2013, shipping on the NSR marked a record 10 year-high volume of 1.36 million tons with 71 voyages. Accordingly, comparative analyses of estimated shipping cost via the NSR and the alternative conventional routes, especially the SCR, have been carried out. Furthermore, NSR/SCR-combined shipping, that is, when a vessel transits the NSR during the warmer months and the SCR in the colder months, has already been proposed as a realistic scenario for Arctic shipping in the previous studies. Since assumptions used in the cost estimations vary among the studies, as discussed by Lasserre, there remain some difficulties when comparing estimated shipping costs. This study aims at establishing a common platform of a wide range of cost estimation assumptions, through clarifying and analysing the cost components contained in the current literature. In addition, interviews with NSR shipping professionals were conducted concerning the NSR fee on an unofficial basis, since typically such fees are determined based on negotiations between ice breaker escort service provider and shipping company. An empirical analysis revealed that NSR/SCR-combined shipping of container cargo between East Asia and Northwest Europe can be commercially feasible. Article in Journal/Newspaper Arctic Global warming Northern Sea Route Sea ice RePEc (Research Papers in Economics) Arctic Breaker ENVELOPE(-67.257,-67.257,-67.874,-67.874) Lasserre ENVELOPE(-58.421,-58.421,-62.107,-62.107) |
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RePEc (Research Papers in Economics) |
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description |
Maritime trade between East Asia and Northwest Europe using the Northern Sea Route (NSR) has been recently increasing, because ship operators may take advantage of the shorter sailing distance of NSR whose navigable season has become longer because of retreating Arctic sea ice. As Arctic sea ice continues to retreat because of global warming, the NSR is now approximately 40 per cent shorter than the Suez Canal Route (SCR) for such trade. In 2013, shipping on the NSR marked a record 10 year-high volume of 1.36 million tons with 71 voyages. Accordingly, comparative analyses of estimated shipping cost via the NSR and the alternative conventional routes, especially the SCR, have been carried out. Furthermore, NSR/SCR-combined shipping, that is, when a vessel transits the NSR during the warmer months and the SCR in the colder months, has already been proposed as a realistic scenario for Arctic shipping in the previous studies. Since assumptions used in the cost estimations vary among the studies, as discussed by Lasserre, there remain some difficulties when comparing estimated shipping costs. This study aims at establishing a common platform of a wide range of cost estimation assumptions, through clarifying and analysing the cost components contained in the current literature. In addition, interviews with NSR shipping professionals were conducted concerning the NSR fee on an unofficial basis, since typically such fees are determined based on negotiations between ice breaker escort service provider and shipping company. An empirical analysis revealed that NSR/SCR-combined shipping of container cargo between East Asia and Northwest Europe can be commercially feasible. |
format |
Article in Journal/Newspaper |
author |
Masahiko Furuichi Natsuhiko Otsuka |
spellingShingle |
Masahiko Furuichi Natsuhiko Otsuka Proposing a common platform of shipping cost analysis of the Northern Sea Route and the Suez Canal Route |
author_facet |
Masahiko Furuichi Natsuhiko Otsuka |
author_sort |
Masahiko Furuichi |
title |
Proposing a common platform of shipping cost analysis of the Northern Sea Route and the Suez Canal Route |
title_short |
Proposing a common platform of shipping cost analysis of the Northern Sea Route and the Suez Canal Route |
title_full |
Proposing a common platform of shipping cost analysis of the Northern Sea Route and the Suez Canal Route |
title_fullStr |
Proposing a common platform of shipping cost analysis of the Northern Sea Route and the Suez Canal Route |
title_full_unstemmed |
Proposing a common platform of shipping cost analysis of the Northern Sea Route and the Suez Canal Route |
title_sort |
proposing a common platform of shipping cost analysis of the northern sea route and the suez canal route |
url |
http://www.palgrave-journals.com/mel/journal/v17/n1/pdf/mel201429a.pdf http://www.palgrave-journals.com/mel/journal/v17/n1/full/mel201429a.html |
long_lat |
ENVELOPE(-67.257,-67.257,-67.874,-67.874) ENVELOPE(-58.421,-58.421,-62.107,-62.107) |
geographic |
Arctic Breaker Lasserre |
geographic_facet |
Arctic Breaker Lasserre |
genre |
Arctic Global warming Northern Sea Route Sea ice |
genre_facet |
Arctic Global warming Northern Sea Route Sea ice |
op_relation |
http://www.palgrave-journals.com/mel/journal/v17/n1/pdf/mel201429a.pdf http://www.palgrave-journals.com/mel/journal/v17/n1/full/mel201429a.html |
_version_ |
1796304429340688384 |