How Will Technology Shape The Shipping Industry in 2023

Intro

About 90% of the traded goods are transported through ocean freight shipping globally. It has been integral to the growth and prosperity of commerce since the middle ages. And technology has been integral to the growth and prosperity of the shipping industry.

Each year, new technologies help make ships bigger, faster, and more efficient. Below are the innovations that will dictate the global shipping market in 2023.

Artificial Intelligence will improve the Efficiency of Operations

The shipping industry is gradually adopting artificial intelligence (AI) to improve efficiency.. AI will help create predictive schedules, organize containers, plan voyages, optimize fuel consumption, and more.

Artificial Intelligence is also making the shipping industry safer. Human error caused 75% of maritime collisions between 2014-2019. Many ships are shifting to AI-assisted navigation to avoid accidents. Major shipping companies, such as Stena Line and OOCL, have already adopted AI solutions in different capacities for their vessels.

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The applications of AI are not limited to ships. Even major ports are also using AI to manage operations. They are also using AI to handle different parts of the infrastructure autonomously.

The Port of Valencia study showed that machine learning and AI can manage ships and truck visits quite well. They used AI to create flexible hours for different vessels. The outcome showed how AI can help reduce congestion at ports.

Many ports around the world are also using AI in different capacities. The ports of Singapore, Los Angeles, and Rotterdam are great examples of AI-powered operations management. This will be very useful in tackling recent port congestion. About 66% of container ships were delayed in 2022. The average delay for container ships also rose from 4 days in 2019 to a week in 2022.

Artificial intelligence can also identify areas to save costs. It can also help reduce the wastage of resources. As AI optimizes ships and ports, businesses around the world may enjoy the cheapest international shipping rates and faster delivery.

Robotics will further reduce Dependence on Labour

Robots are already replacing humans in several shipping operations. For instance, Hyundai Merchant Marine (HMM) is using underwater robots to clean the hulls of their ships. Such robots can work in difficult conditions.

Robots can function more efficiently underwater than humans. They also help reduce environmental damage while cleaning. These robots can control toxic materials while cleaning and protecting the ocean from pollution.

Similarly, several companies have developed robots to clean oil spills. This is again a dangerous job for humans. It involves dealing with fumes, toxic chemicals, and fire explosions. A robot can clean up the mess in the ocean without putting human life in danger.

Robots are also replacing people in several other areas such as ship inspections and repairs. It is challenging for humans to detect damage or corrosion on a ship’s body. Robots can use a variety of sensors to inspect ships. These sensors help identify minor cracks and corrosion on a vessel. They can also predict the severity of such damages. Unlike humans, these robots can easily travel underwater for inspection.

Aside from cleaning, robots have a variety of applications on ships and docks. Many docks employ robots to load and unload cargo from ships. As the scope of application increases, we will see more robots employed in the shipping industry in 2023.

The Internet of Things will help Centralize Operations

The Internet of Things (IoT) will help connect different machines and equipment on the ship to help centralize operations. IoT helps control different machines remotely. Hence, it diminishes the requirement for human intervention at each stage.

The captain of the ship can remotely operate different parts of the ship. It can also allow the onshore crew to take control of the vessel when needed. IoT also offers more flexibility over manual control.

For instance, if the captain wants to shut down several operations simultaneously. They can do so with the click of a button. On the other hand, if the ship is completely manual. The captain will need to send someone to different parts of the ship to shut down different machines.

The IoT network also generates a lot of data. This data can help ship captains make better navigation decisions. Incorporating enterprise IoT solutions can further enhance this data-driven approach, offering more sophisticated analytics and operational control for shipping companies. It also helps improve the operational efficiency of the ship. The data can identify areas for improvement and waste reduction. The real-time data will also keep the operators abreast of the ship’s condition.

A simulation experiment deployed several IoT technologies on a container ship. These results showed how IoT can assist the ship’s crew. The IoT network could detect vulnerabilities in the ship, generate insights for performance optimisation, and even identify the optimum cargo weight to maximize the utility of the ship.

Autonomous Vehicles will run Alongside Manual Vessels.

Autonomous ships require no human intervention. They can navigate the oceans, decide their own routes, control the cargo during transit, and dock at ports.

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In 2016, Kongsberg launched the first fully autonomous ship. This ship could handle long-distance shipping with little to no crew. Then in May 2022, the first autonomous commercial cargo ship completed a 500-mile journey with only 1% human intervention. During this journey, the 750-gross-ton ship managed to avoid hundreds of collisions.

With the help of sensors and AI navigation, ships are rapidly moving towards automation. Soon, fully autonomous vehicles will cruise through the oceans. The autonomous vehicle industry stood at $35 million in 2022 and will rise to $92 million by 2038.

In 2023, many shipping companies will include autonomous vehicles in their fleets. Though these ships will still be under human supervision.

Innovations in Green Technology will reduce environmental impact.

The shipping industry accounts for 3% of global greenhouse gas emissions. Fortunately, international regulatory authorities are planning to reduce this damage. The International Maritime Organisation (IMO) intends to cut down their carbon emissions in half by 2050.

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Fossil fuels are one of the biggest contributors to environmental damage. The shipping industry accounts for about 300 million tons of fuel consumption each year. This accounts for about 5% of global fossil fuel production. Many ships are shifting to environmentally friendly fuels to reduce greenhouse gas emissions.

The shipping industry is gradually adopting low sulfur oil and liquified natural gas (LNG) as their primary fuel. Some ships are also using Sail & Kite propulsion systems to reduce the burden on the ship’s engine.

Many new ships combine several power sources for propulsion. These include solar cells, fuel cells, and battery systems. Shipping companies are also implementing green technology for the construction of vessels. Instead of metal, many ships are built using eco-friendly materials.

Collectively these technologies will significantly cut down the environmental impact of the shipping industry.

Outlook of the Shipping Industry in 2023

Since 2020, the shipping industry has experienced additional pressure owing to the sudden surge in the eCommerce industry. This is further compounded by the Amazon effect, which is focus of companies on fast and cheap delivery. The brands that offer such deals rank high in popularity among customers.

Fast shipping is one of the biggest influences on customer purchasing decisions. About 62% of shoppers expect the products to arrive within three days, even when they choose the free shipping. You can also see the influence of fast shipping on audience search behaviour. The below graph shows the rise in the popularity of the fast shipping keyword over the years.

According to a study by Shopify, 39% of brands are heavily focusing on minimizing shipping delays. Furthermore, Freightos Baltic Index shows a drop in container shipping rates. In 2021, the global average for container shipping was $10,396. This average dropped to $3,429 at the beginning of 2023.

This will have a direct impact on several industries. Additionally the consumers can enjoy faster shipping at lower charges.

The Shipping Industry will Become More Efficient in the Future

Technology will have a tremendous impact on the shipping industry. It will help make the shipping industry more efficient and less resource intensive. Artificial intelligence will assist shipping companies in operational decisions. It will help optimize the resources to reduce wastage.

With the help of Robotics and IoT, the shipping industry will move towards automation. Beginning with parts of the ships, automation will take over the entire vessel. Autonomous ships are already proving to be a success. In 2023, they will add new achievements to their portfolio.

Alongside progress, technology will also help reduce environmental damage. Green technology will help make the overall industry more cost-effective and energy efficient.