News / South Korea breaks the ice with new vision for Arctic box shipping

South Korea is to test box shipping routes through the Arctic Ocean next year, ending the country’s decade-long hiatus on the Northern Sea Route (NSR), as it seeks to counter China’s presence in the region.

Minister for oceans and fisheries Jeon Jae-so said last week he would set up an organisation to develop Arctic shipping, “in line with President Lee Jae-myung’s vision of tapping into the NSR to develop more revenue streams for South Korean shipping companies and shipbuilders”.

After Arctic shipping launched in the 2010s, South Korea experimented using the NSR, but this ended after only five voyages by ice-breaking tankers. But in the past decade, global warming has made Arctic shipping a reality as the ice meltis sufficiently in summer.

Mr Jeon said with the US and China eyeing Arctic dominance, South Korea could not afford to be left behind and Busan would compete with Shanghai as a key port of the NSR.

Acknowledging the higher costs, particularly for operating icebreakers and insurance, Mr Jeon said: “Financial support will be provided to the shipping companies. Research suggests (that with global warming), the NSR could open all year round by 2027 or 2030. Busan will have an advantage over Shanghai in international dynamics, as other countries seek to contain China’s expansion.”

China however, has become the first mover, with Yangpu Newnew Shipping the most active NSR user, even working with Russian government agency Rosatom to invest in ports and ice-class vessels.

Mr Jeon said his ministry would relocate to Busan and “become the ‘ice-breaker ministry’ and the ‘Northern Sea Route evangelist’ that breaks through the Arctic ice”.

Mr Jeon envisions an NSR economic zone, starting in Yeosu-Gwangyang, passing through Busan, Ulsan, and Pohang.

However, he did not say which South Korean container line would participate. Flagship carrier HMM last month noted that the seasonality and draught restrictions made it impossible to operate Arctic routes profitably.

A likely candidate could be Sinokor, the only South Korean line still operating routes to Russia.

Today, officials in South Gyeongsang province, held a seminar to discuss how to develop its port city of Busan as the core of the nation’s maritime economy and NSR base port.

Busan’s Jinhae New Port is believed to be the most suitable starting point in the NSR, with its 21 berths that can accommodate large containerships, and it is near the new Gadeokdo Airport, set to open in 2030.