Environmental costs in container shipping
On average, the CO2 emission per container handled from China to Europe amounts to 1.913 kg. Combining these numbers with the fact that every third container is shipped empty on the seas, it becomes evident that the environment is experiencing excessive and unnecessary pollution. There is room for improvements in these numbers and carriers can decrease their environmental footprint significantly. This would not only apply to carbon dioxide but also other greenhouse gases dangerous to marine – and bird life.
The root of the problem: Why are containers shipped empty?
Containers are methods of moving goods globally from exporting countries to importing. After unloading the full container, a new return transport stretch has to be found, as moving an empty container costs almost the same as moving a full. A large number of containers are repositioned empty every year because of failed attempts to find a new transport stretch. This is at an industrywide cost of $15-$20bn annually, according to BCG. Not to mention the unnecessary pollution associated.
Empty container moves caused by trade imbalances
Arising from a mixture of structural trade imbalances and liner and network inefficiency, a lot is to be done about the latter, but not much to do with trade imbalances. Being the most important source of global empty container accumulation, trade imbalances happens when countries’ trade balances are either in significant surpluses or deficits. Systematic accumulation of containers will take place when a region imports more than it exports, while regions that export more than they import will face container shortages.
As seen in the above graph, one of the prime imbalance examples is the trade between Asia and North America, where the container flow systematically has increased from China the past years. 1.9 times more containers are moving from Asia to North America, corresponding to 13.3 million TEUs in 2012. The result of this is that more than half of the container slots departing North America are filled by empty containers – at a huge unnecessary cost for the environment.
The Impact of empty containers is huge
It is estimated that more than 6.4 million TEUs are repositioned every year. With the aforementioned amount of emission per container, this amounts to 12,243,200 kg of CO2 every year, just to reposition empty containers.
How xChange decreases the amount of empty containers being moved empty
By improving network efficiency, the ultimate goal of the xChange platform is to match the empty container with a partner in need of the container – providing economic and environmental savings potential for both partners. The supplier saves the repositioning cost and the user leasing costs, a win-win for businesses? We would argue so.
The goal? To make sure that the CO2 released is not just wasted on empty containers and is put into actual use. And as Christian Roeloffs expresses: “..to supply a mutually beneficial system that has the potential to save $20m a year.” By facilitating communication between partners, we are working towards avoiding empty boxes on the seas. It is estimated that avoiding all movement of empty boxes would help the industry reducing CO2 emissions by more than 6 million tons annually.
At the same time, other greenhouse gasses would significantly decrease, as well.