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ON SOME ASPECTS OF GRAIN MARKET LOGISTICS IN RUSSIA AND THE ASIA-PACIFIC

Sergei M. Smirnov

In the spring of 2022, at the initiative of the leading UN agencies FAO and WFP, the topic of the threat of a food disaster in the world due to the events around Ukraine began to unwind. WFP Executive Director David Beasley spoke about this with particular emotional anguish: Right now, Ukraine’s grain silos are full. At the same time, 44 million people around the world are marching towards starvation. We have to open up these ports so that food can move in and out of Ukraine. The world demands it because hundreds of millions of people globally depend on these supplies. We’re running out of time and the cost of inaction will be higher than anyone can imagine. I urge all parties involved to allow this food to get out of Ukraine to where it’s desperately needed so we can avert the looming threat of famine”.

I apologize for such a long quote. However, it is important for understanding how destructively political decisions can affect the economy, and what do the activities of respected international organizations look like at present. A little over two years ago, the WHO “distinguished itself” by rushing to declare a deadly COVID-19 pandemic and after that essentially withdrew itself from  coordinating efforts in the fight against the disease, not to mention leading the process. The genie has been released from the bottle. Chaotic lockdowns, quarantines, the war of vaccines, etc., dealt a powerful blow to global supply chains, led to a general imbalance in the global economy, shortages and precipitous price increases in a number of its key areas.

The global agricultural market looked quite decent and stable against this background. A good harvest in 2021 and optimistic forecasts for 2022 did not give any reason to worry about the fate of the world population. If it were not for the consequences of the logistics crisis – a shortage of containers, disruptions in the schedules of liner carriers, as well as echoes of the fight against a new coronavirus infection. However, the indiscriminate anti-Russian sanctions of unprecedented scale – the de-facto blockade of seaports, restrictions on transport insurance, the impossibility of making financial transactions within the banking system, etc. happened to become the main destabilizing factor for the agrarian market – 2022.

Russia ranks first in terms of wheat exports in the world, Ukraine is in the top five. The share of these countries in the export of oilseeds and vegetable oil is even higher. The main volume (up to 80-90%) of grain exports from both countries falls on the deep-water ports of the Black and Azov Seas.

The crisis around Ukraine, which escalated after 02/24/2022, of course, organizationally complicated the situation with the export of agricultural products from the Black Sea region, especially grain. Nevertheless, it would be a big mistake to evaluate this situation in a simplified “black and white” pattern, in particular, to believe that the transportation of “Ukrainian” grain is being hampered solely because of the ongoing hostilities. In fact, the structure of the grain business and logistics in the region is so intertwined that it is almost impossible to establish for certain who is the owner, partner or beneficiary of a particular transaction. This business involves transnational corporations, large and medium traders, agricultural holdings, while the share of state-controlled companies is small in both Russia and Ukraine. Customs statistics and port reports also do not give a complete picture of “whose” grain is being shipped. Therefore, the imposition of Western sanctions on specific ports of shipment, specific consignments of grain exports, and specific banks through which payments are made just imitates vigorous activity, but in reality, it seriously worsens the already difficult situation in the global agricultural sector.

According to leading analytical agencies, freight rates for grain transportation have increased by 30–70% since the beginning of this year, depending on the route. Combined with the increase in purchase prices caused by negative expectations of impending grain shortages (for which there are no grounds in principle), the threat of food deficiency due to its sharp rise in prices and of subsequent famine looks quite real today, especially for developing countries in Africa and South Asia. The concern from the UN bodies is appropriate here. However, the methods proposed by the United Nations bureaucracy just highlight their ‘concern’ and imitate activity instead of really trying to solve the problem. Exactly like it was two years ago during the “crusade” against the coronavirus.

Well before the start of Russian special operation, some Ukrainian companies tended to slow down grain deliveries; perhaps they were simply not technically ready to fulfill their obligations under export contracts. For example, in May 2022 Egyptian General Directorate for the Supply of Goods terminated the contracts for the purchase of 240,000 tons of wheat from Ukrainian supplier companies Inerco[1] and Nibulon[2]. Further, it was reported that Ukraine has already exported 18 million tons of grain by mid-April 2022, which is 90% of the annual USDA estimate. It turns out that for more than three months between April publication and signing of the UN sponsored ‘Black Sea Grain Initiative’ Ukrainian companies did not export grain at all, otherwise where did the 3 million tons stored in Odessa,  Yuzhny and Chernomorsk  (seaports mentioned in the agreement), come from? The transit of Ukrainian grain and other cargo via the Dniester River and overland routes to the countries of Eastern Europe, including Romania and Bulgaria, which have sea grain terminals, has not been hindered at all. Moreover, even according to Ukrainian media reports, the grain storage and processing system (elevators, silos, dryers, transshipment terminals, etc.) was practically not damaged despite the continuing hostilities in various parts of Ukraine. All these details and inexplicable discrepancies in figures make us think about the background of the current situation with Ukrainian grain exports and, in general, about the threats and challenges in the global food sector.

The events of 2022, having created a number of serious problems for the Russian grain industry, at the same time contribute to a long overdue rethinking of the strategic vector of the industry’s development. The previous emphasis on the development of deep sea grain terminals in the Black Sea basin[3] was reasonably justified from a commercial point of view – proximity to the main areas of production of marketable grain, to primary importers, the availability of labor resources and a modestly developed transport and elevator infrastructure. The main importers of Russian wheat today are Turkey, Egypt, Iran, Saudi Arabia, Sudan, Nigeria and Bangladesh. Geographically, most of these countries are convenient for delivery from the Black Sea ports; politically today, they are also “not unfriendly“. However, the consumption markets of these countries have limitations in terms of capacity and solvency, and uncontested maritime communications through the Black Sea straits are subject to existential strategic threats. Therefore, the issue of diversifying the infrastructure serving domestic grain exports is becoming very relevant today. Especially, taking into account the trends on the global market of grain products. As of 2021, six countries in Northeast and Southeast Asia[4] were among the top 15 wheat importers in the world, with Indonesia topping the list with 6.1% of global wheat imports ($3.5 bn). At the end of 2021, Asia-Pacific countries showed the highest dynamics of growth in grain imports: Vietnam increased wheat imports by 57.1%, the Republic of Korea – by 39%, Japan – by 17.1%. At the same time, the situation with wheat exports from Russia to the Asia-Pacific countries is paradoxical: in 2021, the volume of deliveries to Indonesia (I remind you that this is the world’s main wheat importer) almost halved and amounted to less than $1 million ($825,000), which is 60 times less than that of Bulgaria, and 1000 times less than Ukraine. China bought $13.8 million worth of Russian wheat last year, which is 60 times less than imported from the US and 1.27 times less than purchases from Lithuania. The only exception is Vietnam, where the volume of Russian wheat exports increased, but in absolute terms, it was insignificant.

Such an obvious bias in the geography of grain exports is explained by both domestic infrastructural restrictions and underestimation of market tendencies, incl. determined by non-economic factors. In fact, these two aspects are interrelated.

As mentioned above, the main volumes of domestic transportation of grain fall on the railroad. However, the volume of grain exports to the Asia-Pacific countries by rail does not at all correspond to the geopolitical and economic realities of 2022. The Eastern range of “Russian Railways” faces serious problems with throughput capacity restrictions, mainly because of the overload with coal transportation. The problem is further complicated by the lack of specialized grain terminals in the Far Eastern seaports, which makes the logistics of large ship grain shipments unprofitable. Talks about the need to build such a terminal on the part of the “United Grain Company” and the administration of the Primorsky Territory have been going on for more than 10 years, but even the site for the future export terminal has not been determined so far.

In view of the foregoing, the following aspects and ways of the “Turn to the East” concept in the sphere of production and export of grain products should be assessed.

A radical increase in the throughput capacity of land export terminals in the Far Eastern Federal District. Successful progress in this area today is associated with the implementation of the project “New Land Grain Corridor” (NLGC), which was approved by the leaders of the Russian Federation and China in 2016. The work is carried out within the framework of the Federal project “International Trade Logistics” of the National project “International Cooperation and Export”.

The Zabaikalsky Grain Terminal that is a key NLGC component will become the world’s first specialized full-cycle land-based grain terminal. It will comply with the requirements of the “Rosselkhoznadzor” and meet the level of biosafety and the requirements of the of the PRC Customs in terms of traceability, safety, separate storage and transshipment of up to 8 million tons per year of grains, legumes and oilseeds. The launch of the terminal will remove infrastructural restrictions on the access of domestic (primarily Far Eastern and Siberian) manufacturers and exporters to the world’s largest market, China, and will stimulate production growth in these regions.

All ongoing investments in the project are private, their volume will amount to 9.5 billion rubles, more than 8 billion rubles of which have already been invested in the project. The investor is the NLGC group of companies. To this day, the project has created 305 highly paid jobs.

Allocated funds, as you can see, do not correspond to ambitious goals declared by project initiators. The new terminal will be able to perform at full capacity only with a radical increase in the capabilities of the entire complex serving the project – access and main roads, storage areas and transfer elevators with a capacity of hundreds of thousand tons of grain, introduction of digitalization in all components and subsystems, expansion of the geography of cultivation and processing of agricultural crops, use of zoned seeds, vocational training of employees in modern agricultural methods, etc.

Understanding the discrepancy between the declared goals and allocated investments, an “Agreement on strategic cooperation and expansion of mutual trade” was signed between the Russian NLGC Group of Companies and the Chinese state corporation “China Chengtong International Investment” on June 17, 2022, at the 25th anniversary St. Petersburg International Economic Forum (SPIEF). In accordance with the document, the Russian and Chinese sides agreed to develop infrastructure and increase the production and supply of grains, legumes and oilseeds in the territory from the South Urals to the Far East, in the amount of 1.9 trillion rubles with settlements in national currencies. In addition, the parties plan to organize deliveries with subsequent localization of production of technological equipment and agricultural machinery in the Russian Federation in the amount of 150 billion rubles, as well as promote joint investments in the amount of 50 billion rubles.

In addition to changing structure of the diet of Chinese with an increase in the share of consumption of wheat and other-than-rice grains and oilseeds, Beijing authorities probably took the decision on such a serious investment project in view of latest developments in strategic environment. The aggravation of confrontation with the United States at all levels, the creation by Washington of the alliances AUKUS, QUAD, Blue Pacific aimed at countering and strangulating PRC, their open support for separatism in Taiwan logically leads China to the need to get rid of its serious dependence on imports of American wheat and food in general. Moreover, the alternative source for its replacement is geographically and ideologically very close.

For Russia, this project today is undoubtedly important and beneficial. However, it should be borne in mind that the promises of investments and the conditions for their provision can vary greatly. In addition, focusing only on China may have a negative impact on the development of economic ties with other Asia-Pacific countries.

Increasing the productivity of the agricultural sector of the Far Eastern territories and developing its export potential through the diversification of partners and introduction of modern transport and logistics technologies.

In the Far East of Russia, there are several fairly successful projects for the development of cooperation in the agricultural sector at the regional and local levels.

China has previously been in no hurry to seriously invest in the agricultural sector of Russia, including in the border areas of the Far East. According to Mr. Vladislav Novoselov, managing director of the BEFL consulting company, “there are many Chinese entrepreneurs who rent land in the Far East, mainly in the Amur Region, Khabarovsk Territory, Primorye, they grow soybeans and corn. There is more free land in Russia and it is much cheaper than in China. As a rule, these are small Chinese entrepreneurs from provinces close to Russia; there are no large well-known agricultural holdings among them. Such enterprises employ Chinese personnel, use Chinese technology, and most of the products are sold to China.”

Cooperation reached a new, higher level in 2018, when the Chinese Joyvio Beidahuang Agricultural Holdings (JBA), together with Russian partners, established JSC “Legendagro Holding“ and announced its intention to invest about 8 billion rubles in Russian agriculture. The Corporation for the Development of the Far East (KRDV) promised to invest another 2 billion rubles in the project. JBA itself is a joint venture of Chinese investment holding “Joyvio” (a subsidiary of “Legend Holding” specializing in rural projects), “Beidahuang” whichis one of the largest Chinese agricultural group (its land bank exceeds 6 million hectares) and the Chinese state-owned company “Jiusan Grain and Oil Industry Group”, specializing in the processing of soybeans.

“Legendagro” has already leased 3,500 hectares of agricultural land in the Khorolsky district of Primorsky Territory, where it grows rice, soybeans and corn. In the future, the company wants to increase the land bank in the region to 50,000 hectares and build a plant for deep processing of soybeans with a capacity of up to 240,000 tons per year. Soy concentrate, soybean oil, lecithin and molasses will be produced here. The main consumers of these products, as planned, will be Asian producers of feed for farm animals, fish, and pets. The business is export-oriented to China, South Korea, Japan, etc.

Republic of Korea. Seven Korean agricultural enterprises have invested in the agriculture of Primorsky Territory Among them is the “Hyundai Khorol Agro” enterprise in the village of Voznesenka. Soybeans and corn are grown there, with plans to develop animal husbandry. The main advantage of its agricultural products is their ecological cleanliness, no GMOs.Hyundai” also has an interest in the Mikhailovsky district, where it plans to create a similar enterprise in Mikhailovka. The construction of the elevator facility was going on there.

Khorolsky district is not the only district in Primorye that has attracted Korean investors. In the Khasansky district, near the village of Kraskino, a UBICOM company grows soybeans and exports it to Korea. Another company, “Pohang Agro-Invest”, leases land in the Spassky district in the village of Zelenodolskoye and harvests hay, which it plans to export to Korea in the future.

As it turned out, one of the problems for coastal farmers and Korean investors is not a low soybean harvest and not a long time to achieve results. The problem is the absence of grain terminal in Primorye seaports to export soybean etc. from Primorye to Korea. Korean and other foreign investors at all levels have repeatedly raised the topic of grain transshipment facility. Such facility in one of the ports in Primorsky Territory could provide a capacity to transship grain from rail and road transport to ships, as well as temporary store grain, soybean meal, etc.]

However, it were the Chinese companies who firstly among the foreign participants in the Far Eastern agricultural market introduced regular sea transportation of grain products. The aforementioned “Legendagro” plans to transport its export products both by land routes and by sea. The company has acquired high-performance port grain loaders that provide loading speeds from 1,000 to 2,000 tons per day and its own fleet of 30 grain trucks. On February 29, 2020, the first transshipment of grain cargo was carried out in the seaport of Zarubino, a key section of the “Primorye-2” ITC. 2,700 tons of corn were shipped to the ship destined for the port of Matsunaga (Japan). All shipment works were carried out by the “Legendagro” personnel together with the  “Seaport in Trinity Bay LLC”, a sole stevedore in Zarubino seaport. According to Mr. Dmitrii Savenkov, General Director of “Legendagro Primorye LLC”, the company planned to export up to 40,000 tons of grain and oilseeds through the port of Zarubino to China, Japan and South Korea in the 2019-2020 grain year.

Table 1. Grain turnovers of Russian Far East ports, thousand tons

Source: ADM Nevelskoy Maritime State University

As can be seen from Table. 1, the volume of grain transportation through the port of Zarubino turned out to be less than planned, however, given the coronavirus restrictions, it should be assessed positively.

Until now, JSC “Vladivostok Commercial Sea Port” (VMTP), which is part of the FESCO group, is practically the only stevedoring company serving regular grain transportation in the Far East basin (see Table 1). A few years earlier, VMTP served the transit of grain from the United States to Mongolia, but this line closed. Due to the lack of silos or temporary grain storage sites, VMTP cargo operations are carried out in the direct “ship-wagon” variant, which significantly reduces the throughput. Therefore, it is logical that it was FESCO that launched the project to create a specialized port infrastructure for sending grain cargo from the Russian Federation to the Asia-Pacific countries on the basis of the universal terminal of the “Port Gaydamak” JSC (Vladivostok, previously the terminal was owned by a group of individuals). The terminal with a total area of ​​about 21 thousand square meters provides stevedoring and terminal services, it is linked to the “Russian Railways” network which is one of its main advantages for FESCO. At the first stage, it is planned to modernize the terminal, creating capacities for transshipment of grain using elevators by 2024. At this stage, the volume of transshipment should be 400 thousand tons per year.

However, even such relatively small in size[5]  and throughput grain terminal, will require several years for construction and large investments. It is necessary to solve the problem of export transportation today. For this, there is probably only one option left – to develop a network of transshipment hubs and sites for loading and processing grain in standard 20 ft. containers.

FESCO specialists are seriously studying this issue. According to their estimates, the global containerization of grain is about 3-4%. In Russia, this indicator for rail was only 0.3% in 2018. The reasons for this difference are quite simple: for example, in the United States, due to the excess of imports over exports, a large number of empty containers are released on the market, which can be returned empty, or grain or other cargo can be loaded into them, which is successfully done. In China, the situation is reversed – due to the large volume of empty containers returned to the country, the cost of side loading logistics is low. High containerization of grain exports is also noted in Australia, where almost 100,000 TEUs with grain are shipped annually, which is explained by a combination of factors: from the structure of exports with a bias towards higher quality and more expensive grain to the infrastructure of recipients mainly in Asian countries. In Russia, there is almost no export to countries that use grain containerization technology – China, Malaysia, Myanmar, Thailand, South Korea, where the infrastructure for working with bulk cargo is limited and vast experience has been accumulated in working with containers. The most popular scheme for the transportation of grain in a container in Russia is stuffing in bags of 25-50 kg, which allows transporting 18 tons in a twenty-foot container. At the same time, using a liner-bag packaging technology, you can load up to 23 tons. An additional 5 tons is significant given the low cost of the cargo. However, this technology in Russia is not widely used, the liner-bags are purchased from abroad, and the container is usually stuffed very slowly. It takes time and the interest of the parties to establish this mechanism.

It is significant that the issue of grain transportation in containers was seriously studied in Ukraine, where, it would seem, there are no problems of lack of specialized sea terminals. In particular, according to D. Shkarupeev, project manager for the construction of grain elevators, “the world practice of using containers for transporting grain suggests that the volume of grain transported in containers is about 10% of the total.” However, he further concludes that this method is unprofitable due to the complexity of loading and weighing at border crossing points. [13]

***

It seems that the method of transporting grain and grain products (feed, meal) in standard containers has good prospects to introduce in the Russian Far East. It is much easier and faster to set up the production of standard liner bags (essentially, large plastic bags) locally and create a network of container side-loading and weighting sites along the route of eastward container trains than to wait for the commissioning of specialized grain terminals in seaports. In addition, small and medium-sized batches of grain cargo will quickly find their buyer. Moreover, Russian logisticians and their partners from the countries of NEA and SEA have been able to work with such small-scale or even single cargoes for a long time and quite successfully, which, in particular, is shown by optimistic situation in the Russian consumer market after the introduction of massive Western sanctions.


[1] INERCO is a subsidiary of the Ukrainian agricultural holding “Kernel”, the largest supplier of sunflower and sunflower oil. From 2012 to 2020, Kernel was a co-owner of the new export grain terminal “Taman” (Russia), but sold its stake to the VTB group.  

[2] NIBULON is one of the largest agricultural holdings in Ukraine and Europe. The name of the company was originally deciphered as NIkolaev, BUdapesht, LONdon. It has its own sea terminal in Nikolaev, a transport fleet and 445 granaries throughout Ukraine. Taking into account the declared logistics potential, the company had to fulfill a relatively small contract for the supply of grain to Egypt without any problems. Aleksey Vadatursky, the founder and permanent leader of Nibulon, died under suspicious circumstances in his house in Nikolaev City on July 31, 2022.

[3] The main grain export seaports of the Russian Federation are Novorossiysk, Taman, Azov and Tuapse. The only specialized grain terminal outside the Black Sea basin, JSC “Port elevator” is located in the seaport of Kaliningrad enclave and has an incomparable throughput capacity (about 100 thousand tons of agricultural cargo per year).  

[4] In descending order: Indonesia, China, Philippines, Japan, South Korea, Vietnam.

[5] There are simply no free sites on the territory of the port of Vladivostok to construct a grain terminal comparable to the Black Sea ones.

Chinese Foreign Ministry Expresses Dissatisfaction with US Attempts to Impose Sanctions against Russian Oil Supplies to China

July 27 2022  

The Chinese authorities are categorically against attempts by the United States to impose unilateral sanctions on Russian oil supplies to China. This was announced on Wednesday by Chinese Foreign Ministry spokesman Zhao Lijian.

“China is categorically against such illegal unilateral sanctions,” he said at a briefing, answering a question from TASS about how the PRC authorities feel about such plans by the United States. “China and Russia carry out normal trade and economic cooperation on the principles of equality, mutual benefit and mutual respect “.

As the Chinese diplomat clarified, Beijing’s cooperation with Moscow is not aimed against anyone. “We will also not tolerate external interference,” Zhao Lijian stressed.

As Bloomberg reported earlier, US senators led by Marco Rubio (R-Fla.) have proposed sanctions against companies involved in the sale of Russian oil and other energy resources to China. The bill provides for penalties for any organization that insures or registers tankers that transport oil or liquefied natural gas from Russia to China.

Editorial comment. Playing with fire. It is clear that Republican Senator Marco Rubio and his colleagues are primarily pursuing the goals of the election campaign and would like to embarrass the Democratic administration by accusing it of “insufficient” toughness towards Russia and, at the same time, ignite the fire of a trade war with China, which Donald Trump failed to accomplish fully. However, the absurdity of dictating whom, from whom and for how much to buy is so obvious that the US executive branch will hardly dare to subscribe to the initiative of the Rubio group.

Source: https://portnews.ru/digest/23246/

TransContainer will launch a new multimodal service from China to Russia through the port of Vostochny

March 28 2022

PJSC TransContainer will launch a new multimodal service for cargo transportation from the Chinese ports of Taicang and Ningbo to the regions of the Russian Federation through the terminal of the Eastern Stevedoring Company. The service is focused on transportation of consumer goods from China for small, medium and large businesses in Moscow, Yekaterinburg, Novosibirsk, St. Petersburg, Krasnoyarsk and other cities of Russia. The departure of the first ship from the port of Taicang is scheduled for early April. Transit time on the sea shoulder will be 3-4 days. Four departures are planned monthly on the route Taicang / Ningbo – Vostochny. Trains from the Far East to the regions of the Russian Federation will run on a weekly basis as part of the service. In the future, sea transportation will be additionally organized from the port of Ningbo, and delivery to Taicang from the ports of Qingdao, Xingang, Shenzhen, Guangzhou and Xiamen will also be available.

Source: PortNews.ru

Russia Will Be the World First to Get Autonomous Sea Vessels

August 18, 2021  “PortNews”

The State Duma (Parliament) of Russia is to adopt amendments to the Merchant Shipping Code and several by-laws regulating the use of autonomous vessels this fall. Several agreements of intent for the construction of more than 20 vessels of three series, equipped with autonomous navigation systems, have already been signed with selected shipping companies.

Today, autonomous navigation systems are being tested in real conditions on three ships at once. We are talking about the dry cargo ship ‘Pola Anfisa’ operating in the Mediterranean and Black Seas, the ‘Rabochaya’ barge and the ‘Redut’ dredger (Black and Azov Seas) and the ‘Mikhail Ulyanov’ tanker in the Barents Sea. Most often, they work as usual, but periodically when the opportunity arises, they go to autonomous control mode.

“In the very near future, we are going to conduct demonstration voyages that will summarize these tests,” said Alexander Pinsky, “Marinet” general director.

According to the project, it is planned to complete the experiment on December 31, 2025. The tests will be carried out in 11 regions of the country, including St. Petersburg, Leningrad, Kaliningrad and Murmansk regions.

“The first route operated by such vessels will appear between Ust-Luga in the Leningrad Region and the ports of Kaliningrad and Baltiysk,” said First Deputy Prime Minister of the Russian Federation Andrei Belousov. “In the future, after 2025, autonomous vessels will enter the ports”.

This project is especially important for the Kaliningrad region, said Dmitry Lyskov, head of the press service of the Kaliningrad regional government. According to him, the most optimal way of communication between the enclave and the “mainland” is the sea route. But. the ships working on it are very old and obsolete. The railway option is also far from ideal, since foreign “neighbors” make increased demands on it. For example, for a long time they prohibited the transit of trains with more than 50 people on board through their territory. Then this limit was increased to 250 passengers.

At the moment, air traffic is the most stable, but it is not able to cover all the transport needs of the region. Autonomous ferries of “Rosmorport” will solve this problem. Now they are on the final stages of construction, and one of them is undergoing sea trials. It is assumed that they will be able to go to sea in 2022. They have a chance to officially become the world’s first autonomous vessels, if they are not overtaken by two other Russian companies involved in this project.

Similar experiments were carried out by other countries. However, Russia, unlike its foreign competitors, has managed to organize the process in such a way as to fit into international maritime conventions without the need to revise them, which could take decades for approval. In other words, any Russian vessels, including autonomous ones, will comply with all the requirements of the IMO conventions.

Autonomous ships are frequently called ‘unmanned’, but this is not an entirely correct term, emphasizes Alexander Pinsky. Autopilot systems capable to plot a route for a vessel without human intervention appeared in the 1970s – earlier than on airplanes and cars. But, autopilot systems can only guide ships along a given trajectory. If there is any danger, for example, approaching another vessel, the autopilot will not be able to do anything.

Autonomous navigation systems, unlike autopilot, are able not only to identify a dangerous situation, but also to make changes to the route, and then give a command to the rudders and engines of the vessel for the necessary maneuver, or offer such solutions to the person controlling the vessel.

The main point of introducing such systems is to minimize the risk of human errors, which are the main cause of marine accidents and disasters. In addition, it will allow maritime shipping companies to save significant amounts of money. Maritime safety costs a lot of money. This is the installation of various technical means on ships, an additional crew on board, its training and certification. Given that there is a shortage of seafarers in the world, these costs are constantly growing.

According to Alexander Pinsky, autonomous navigation is currently the only way to improve the safety of navigation. Part of the crew can be moved to the shore, and this is already a considerable savings. Some positions on board the ship will simply become unnecessary, since many routine operations will be performed not by a person, but by automation. As a result, the number of crews can be reduced by about 25-30 percent. “We do not set goals to completely get rid of ship crews”, – the expert notes. “Some functions can be handled by machines, and some still require a human. For example, automatics will not be able to take care of passengers on board and rescue them in case of an accident. It also makes no sense to automate a number of technical functions, since it will be more expensive than the work of a person on board – we are talking, for example, about mooring or pilotage in the port. Yet at least one shift can be removed from the crew of the vessel.

Source: https://portnews.ru/digest/22628/