I think we should put a limit on the growth of mega ships because they require more and more investment in ports in the name of a loose-loose competition and often these investments are, at least in part, paid with public money
Its absolutely perfect statement, we should limit ourselves upto Panamax
The limitation may be done by discussing them within the "alliance" of port authorities. The alliance of port authority itself gains higher bargaining power to make deals with vessel liners. The power of these alliances may be already used by the vessel liners in order to make deals with the ports. The group of port authorities may address their limitation to receive those larger ships due to the limitations in their expansion strategies.
Of course, port authorities with great capability to enlarge their landside and terminal flow capacities may still accept the growth of these mega ships and gain more profit (after a certain benefit-cost analysis).
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The discussion on size restriction is a relevant one. We are evaluating some of these aspects in one of my latest publications:
PORT MANAGEMENT IMPLICATIONS FROM ECONOMIES OF SCALE IN THE LINER CONTAINER SHIPPING INDUSTRY
Ricardo J. SANCHEZ, Gordon WILMSMEIER in: Stephen Pettit, Anthony Beresford (Eds). 2017. Port Management- Cases in Port Geography, Operations and Policy, KoganPage.
I recently proposed a regional agreement of Latin American countries to restrict vessel size in the region to Neo-Panamax size. As such a joined agreement would give higher security for investment planning.
90% goods was be transport by shipping all the world, that is include port logistics.
I think it would be very important if US and EU countries in which there are reference ports for traffic with the Far East countries, consider the possibility / need for binding agreements to limit their expansion linked to the size of ships.
Personally I am not convinced that this will happen but I think that regulatory intervention (also in a semi-liberalizated market) would be needed to avoid competition that would waste a lot of resources for the benefit of very few shipping companies.
https://www.researchgate.net/project/The-container-markets-perspectives-a-lose-lose-game-to-be-stopped
Taking into account the need to quickly market the products, the longer, longer quay occupation time and thus longer the dwell time. It becomes a snowball where everything is delayed. The delay time in some ports is 2 days. and one waiting to dock. in faster ships even LPG and smaller the circulation of products is faster and more efficient and efficient.
Maritime sector is fueling all international trade in the globalized world. It is better to put the sector as a catalyst of all sectors irrespective of economies scale. Driven in particular, maritime sector supported the trade economics in all sector and having the role of increasing GDP and GNP of a country directly and indirectly.
Agreed with NagaLakshmi .Inland distribution will help to develop the maritime economy.
the mega ships increase the economic of scale in maritime transport and therefore in the economics of nations.
Dear Arbia,
it is not that simple, please read our publication, discussion this issue. Larger vessels are not always a good solution.
PORT MANAGEMENT IMPLICATIONS FROM ECONOMIES OF SCALE IN THE LINER CONTAINER SHIPPING INDUSTRY
Ricardo J. SANCHEZ, Gordon WILMSMEIER in: Stephen Pettit, Anthony Beresford (Eds). 2017. Port Management- Cases in Port Geography, Operations and Policy, KoganPage.
Our two recent studies show that the size of the ships does not have a positive impact on bilateral trade. In these two studies, we have used a different subset of data and applied different methodologies, but still, the results are similar.
There are two references which I consider to be important:
1.The Optimal Ship Size. Jan Owen Jansson and Dan Shneerson
Journal of Transport Economics and Policy
Vol. 16, No. 3 (Sep., 1982), pp. 217-238
2. A Theory of Optimum Ship Size. P.M.H. Kendall
Journal of Transport Economics and Policy
Vol. 6, No. 2, (May 1972), pp. 128-146.
But in other cases, they may have a positive impact. For instance, in the case of fuel consumption, the initial cost of building a ship, the labor costs in the port and in the ship. Maybe if we compare these, it will have a good return on investment in the long run. I don't know if there has been any research in this area.
It is not so simple. Depend also from the port side facilities and also considering the port city connectivity. Very interesting topic area to continue to investigate
The question on the optimal size of ships, I believe, is an academic debate. The commercial decisions of stakeholders in limiting the external barriers (e.g the Canals expansion, port capacity, technology, etc.) will ultimately determine the limits of ships economies of scale.
I think, limiting sizes of ships is a moral argument, which need further investigation before policymakers buy-in and considerations.
There should be an international body of all stakeholders that would consider all scientific evidence such as the optimal ship size and capacity; the economic, social and environmental impact of ports, and required investments to accommodate the growing size of the ships and traffic, the risks such as the accident in the Suez Canal, and all relevant factors. They could then recommend restricting the size of the ships, if it is in the best interests of al stakeholders.