SMM conference report: the future of shipping is how it deals with labour

IPhoto: © Denys Yelmanov | Dreamstime.com

The great and the good of the shipping industry recently congregated in Hamburg for the bi-annual SMM exhibition, and The Loadstar understands freight forwarders need not be concerned with how shipping is working, so long as it does.

But given its lamentable recent track record in that respect, we took the temperature at maritime’s biggest trade show.

The inaugural panel opened with recorded messages from the German federal government to say that shipyard Meyer Werft would be bailed out, lending an uncharacteristically human angle to what is traditionally a fairly dry discussion about hulls.

Talks centred on awful labour conditions squeezing out talent in shipbuilding and ship crewing: 240,000 people would “age-out” of shipbuilding in the next decade, said Magda Kopczynska, EC director general for movement & transport, bringing a gasp from the audience.

Alberto Maestrini, chairman of Italian shipbuilder Fincantieri, said it was time Europe revisited its attitude to shipbuilding, a synecdoche of manufacturing and supply chains in general. “In some countries, manufacturing is considered low-tech,” he said.

“You do the engineering and design and then build in Asia. If we follow that path, shipyards will soon die in Europe. The component manufacturers will follow – they go where the shipbuilders are.”

Meanwhile, who on Earth would sign up to be a seafarer? wondered the IMO’s new secretary general, Arsenio Dominguez, highlighting that while many on land now work remotely, crews still scrape together internet access to Skype with their loved ones by paying their employers in company scrip.

“I mean come on,” the IMO chief said. “We need to actually treat people onboard vessels the way we treat people ashore.”

That’s when they are not being shot at: “Seafarers have died, vessels have sunk,” added Gaby Bornheim, president of the German Shipowners’ Association (VDR). “We need security and safety for our maritime and trade lanes.”

And, of course, the gender imbalance in shipping still has a long way to go, judging by the 7.1% of German seafarers who identify as women – remarkable progress in itself. Quizzed on the gender balanced panel, Mr Dominguez insisted that if it were not, he wouldn’t have been there, raising a cheer from the audience. Unusually forthright from an IMO chief, but hardly before time.

AI dawns

An embarrassing silence set in when a question was put to panellists about automation, that which just years ago was going to revolutionise shipping and put all seafarers out of jobs. No one wanted to answer that one.

AI, on the other hand, is ‘going to change everything’. The next generation of crews, who would need to be familiar with myriad new propulsion and fuel types, would be trained by AI, explained MAN CEO Uwe Lauber.

Later in the week, a weather-routing expert alluded to “what used to be called data optimisation, but is now called AI”, while confirming to me later that the substance of the activity had not changed.

On the sidelines, a Japanese ship captain confided that he resented the presumptuousness of AI in navigation. “It used to be called ‘decision support’,” he said. “Now I don’t feel like the one making the decision.”

Some AI-generated voyage plans would be deadly, if followed, he explained, and over-reliance on AI would claim lives, if it came at the expense of human judgement. But the technology shows promise in other areas.

“If I’m coming into port in fog… not all those boats and barges have an AIS transponder,” he said. “AI is very helpful for that.”

The prestigious SMM “AI for the oceans” award was handed to Tom Redd, ocean governance manager at HUB Ocean, a company which tracks the outcome of human activities like shipping on marine habitats like reefs, mangroves and mud flats. Generative AI was important for providing “trust” in the data collected, he said. “We wouldn’t be in 2024 if it wasn’t AI. Having good data as a foundation for your models is essential.”

Beyond the horizon

Shipyards are completely booked up, and a vessel ordered today will be unlikely to reach the water by 2030. And ten years into their lifetimes, FuelEU will demand a 31% emissions reduction. But this demand is also expected of existing ships, which cannot all be scrapped and replaced in the next decade. Without enough new efficient ships to come to the rescue, shipowners will have to readjust, The Loadstar heard, by re-engineering existing fleets and re-evaluating the ‘investment horizon’ of existing ships.

At a global maritime environmental congress conference, Suraj Bhatra, fleet technical manager at tanker company Ardmore Shipping, told audience members that “most owners are sitting on a chunk of cash. It’s a good time to invest”. Mr Bhatra was discussing tankers, but the story is similar in container shipping, following the Red Sea crisis.

Later, Captain Silke Lehmkoester, Hapag-Lloyd’s fleet manager, confirmed this, describing how the carrier’s customers have assisted in funding its latest retrofits, which, she said, would buy them a better service.

But the human angle struck again, as another veteran seafarer, Harriet Hunnisett Johnson, Signol consultant product manager, said greater investment in people, and a better understanding of behavioural science, would be necessary. Unless owners could convince their crews ‘to go above and beyond’ to save their employer fuel, neither digitalisation nor highly efficient retrofits would matter much, she said.

How best, then, to motivate a worker to do more and better work? The mystery endures.

“It used to be that the primary motivating factor was serving under an authoritarian captain,” Ms Hunnisett Johnson told The Loadstar. “But there are far fewer seafarers now, and you can’t just sack them – we have to think about how to motivate them in other ways.”