New risks in the new normal
The shipping industry has proven its value to the global economy during the Coronavirus pandemic in a way not seen since the Second World War, but as the long term challenges from the virus become clearer, it must address new and consequential risks.
Despite the short term shock to the supply chain, the industry has largely proved resilient in keeping essential supplies moving; the problem is there is always a cost and in this case it is seafarers who have paid the price.
Relief of crew is essential to ensuring the safety, health and welfare of seafarers and so far, despite all assurances and hot air expended, there is no end in sight to the impasse. Extended periods onboard ship can result not only in mentally and physical fatigued crew but in accidents. Human error is a causal factor in 75% to 96% of marine incidents, according to marine insurer Allianz.
The sustained economic downturn that most economists expect to follow the virus will also have implications for shipping risk, as vessels are laid-up and companies take steps to manage costs, Allianz predicts. Past downturns have shown that crew and maintenance budgets are often among the first areas to be cut, with obvious implications for safety.
The pandemic has made it difficult for vessels to obtain essential spares and consumables, such as oils and lubricants as well as carry out maintenance and repairs. This could have a detrimental effect on the safe operation of engines and machinery, potentially causing damage or breakdown, which in worst-case scenarios can lead to groundings or collisions.
But while seafarers have had little choice but to keep working, an increasing portion of the world fleet is not moving at all.
The cruise industry, which generates more than $150bn in global economic activity and supports over one million jobs worldwide, effectively went into hibernation when the pandemic struck. With the biggest cruise ships worth in excess of a billion dollars, accumulations of risk are a potential issue while restrictions are still in place.
By April, some 95% of the global cruise fleet was in lay-up, with many vessels anchored in hurricane-exposed areas in North America and typhoon-exposed areas in Asia. Emerging from lay-up poses another challenge. The monthly cost of cruise ship lay-up can be in the millions of dollars and the extent of upkeep and crewing will affect the speed with which a vessel can be brought back into service.
As the price of oil plummeted amid concerns for the coronavirus economy, demand for floating storage hit record levels. Many tankers have been idling around major oil ports and terminals in the US, Europe and Africa, with potential exposures to extreme weather, piracy and political risks. Tankers have also been chartered for use as floating storage, which will need to be subject to maintenance and contractual requirements.
Existential threats are growing too, Allianz reports. As vessels become more connected to shore-based systems, so the cyber threat is ever-evolving; from crippling ports and terminals to spoofing attacks on ships. The Coronavirus outbreak has impacted here too, with reports of companies having faced a 400% increase in attempted cyber-attacks since the pandemic began.
As modern vessels become increasingly dependent on computer and software, and with heightened geopolitical risks, the threat of cyber to the shipping industry is significant. The way in which vessels and crew are interacting with technology has become a significant factor in collisions and groundings.
Last year, the US Navy announced it would replace touch screens with manual controls after an investigation into an incident involving one of its vessels in 2017 which resulted in fatalities. As any ECDIS user knows, technology can improve safety and better training can result in better situational awareness, but there are often serious gaps between this assertion and reality.
Allianz suggests the industry needs to start learning from successful journeys, not just accidents. Such insights can be used to develop new technology, improve training, crew experience and safety culture.
Increased use of industrial control systems to monitor and maintain engines could lead to a significant reduction in machinery breakdown incidents in future, it reckons. Over the years, the shipping industry has moved from time-based maintenance to condition-based maintenance, and with digitalization, it will shift towards predictive or preventative maintenance. In time, the move to preventative maintenance could improve the reliability of engines and ultimately improve safety.
Human error remains a key factor in breakdown losses and even a well-trained crew can make mistakes it points out. Real-time monitoring from onshore by managers in consultation with manufacturers, moving towards preventative maintenance could reduce such risk and also remove the burden from seafarers.
In the current climate it makes sense to explore every opportunity to eliminate the repetitive manual tasks that dog seafarers’ lives, increase risk and don’t add any value. It is only a shame that it took a crisis of this proportion to bring such advantages to the forefront.