News / HMM pours cold water on president's push for Arctic box shipping

The seasonality and draught restrictions of Arctic shipping means it will be unprofitable to run liner services through the Northern Sea Route, an HMM executive said this week.

Mr Lee Sang-cheol, the carrier’s head of planning (container fleet), was speaking at a South Korean parliamentary session on Friday discussing the feasibility of Arctic shipping – new president Lee Jae-Myung has pledged to rejuvenate the country’s maritime sector.

Part of his strategy is to use the Northern Sea Route to generate demand for icebreakers at the country’s shipyards, and encourage South Korean shipping companies to carry cargo through the Arctic.

However, this is viable only in the summer, when the ice melts sufficiently to facilitate shipping.

Mr Lee Sang-cheol said: “A 24,000 teu containership passing through the Suez Canal would generate $33m in yearly profit, but a 3,000 teu vessel on the Arctic route would lose $12m in a year.”

Navigational conditions in the Arctic also mean that one ship could only make one round-trip a year, he added.

Moreover, only ice-class ships can transit the Arctic, and it costs 30%-300% more to build such vessels.

At the same session, Pan Ocean’s head of project sales, Mr Lee Myung-Wook, said sanctions against Russia presented another challenge.

He said: “Most of the waters in the Northern Sea Route are located in Russian territory or exclusive economic zones. There’s an urgent need to resolve political, diplomatic, and geopolitical risks.”

Meanwhile, Chinese shipping lines are also keen on tapping into the Arctic.

Sea Legend Shipping, a Singapore-incorporated operator that emerged last year with a China-Red Sea service escorted by the Chinese navy, will launch a Far East-Europe route through the Arctic in September, with an 18-day turnaround, nearly half the time of going via the Cape of Good Hope.

Reportedly backed by Chinese forwarder Worldwide Logistics, Sea Legend will work with another Russia-focused operator, Safetrans Line, deploying the 4,843 teu Istanbul Bridge, operated by Safetrans.

Sea Legend claims its new service is already fully booked, and it is targeting fast-moving consumer goods, including lithium batteries.

A presentation by Sea Legend claims that the low-temperature environment in the Arctic will naturally suppress the thermal runaway risks of transporting lithium batteries.