Why Container Ships Got Huge

In July 2021, Evergreen Marine took possession of the world's biggest container ship: the Ever Ace.

Built for Taiwan-based Evergreen Marine, the ship is as long as the Empire State Building is tall from bottom floor to roof.

With a carrying capacity of 23,992 twenty-foot-equivalent units or TEU, these Evergreen A-class megaships take the record - set just the previous year - from HMM's Algeciras-class ships.

It can hold 10% more cargo than the infamous Ever Given, that one ship that got stuck in the Suez Canal.

These ships herald a new era of ultra-large container ships. And it is a bit of a surprising trend. What is pushing these container ships to get bigger? And is there anything keeping them from getting even bigger down the line?

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[JathuSatkunarajah]

A largely automated present-day container ship can carry more tons than the merchant fleet of an entire early modern kingdom. In 1582, the English merchant fleet had a total carrying capacity of 68, 000 tons and required about 16, 000 sailors. The container ship OOCL Hong Kong, christened in 2017, can carry some 200, 000 tons while requiring a crew of only 22.

Source: Yuval Noah Harari, Financial Times

[someonespotatohmm]

A reason why big ships keep being more efficient per volume transported is that they benefit from the square qube law. As their external surface area increases with the square power, the internal volumes scales with the qube. There is a point where this stops, because all that extra space needs to be occupied by structural reinforcements.

[GeorgeMonet]

The fact that the ports were forced to shoulder the cost of upgrading costs to handle larger ships is sufficient proof that the shipping alliances operate as an oligopoly. When you have very few buyers or sellers, the lack of competition by itself results in price control via signaling. I work with that all the time.

[bzdtemp]

Good video as always. Thank you.
I do feel you missed a couple of details.
- Maersk run their own ports and have parts in others, so it is part of what pushed the whole port business to support the big ships.
- Also on Maersk, they have a few mid-size ships being build that are meant to run green fuel as in something power-to-x based. And they have let it be know they have customers willing to help fund it, simply put those customers want to boost their green image and are willing to pay extra for shipping.

[SianaGearz]

I'm just amazed by the breadth of topics you're able to cover!

[caesarrustantomcarthur]

I look forward for you to talking about Evergreen.
I was going to Taiwan last week and I found out that this Giant have a lot of business in Taiwan.

[SoreHands]

Great to know more about where the oil / fuel comes from and how it's traded - and how the current fuel supply issues in many countries will affect costs/operations etc. Fascinating vid as always - thanks

[herbertpocket]

Semiconductor manufacturing machines are getting taller for similar reasons, their footprints can’t change, so to increase throughput they have to get taller. Just like how the ships must fit through canals, so the must get taller

[Dillyvl]

we just finished raising all container cranes, extending the boom on some of them to 65m. any wider than that and the ship would have to turn at the quaiside to get to all containers. i believe 62m width will be the max for a while and therefore 400m length.
worked on the suez canal container terminal a few years ago, it's amazing how many of these 400m ships pass by there every day. i woud say easily 15 a day

[Pax.Britannica]

KitKat's break along their length. "Bend like a Snickers Duo" would've been better.

[DesktopInventions]

Another great video from Asianometry! Keep up the good work!

[jobturner]

The assertion that the alliances don’t engage in price fixes is laughable on its face. By manipulating supply of shipping capacity and docking capacity they are effectively colluding to alter the price in there favor. I would not be surprised if they are also fixi by the price and hiding it as many large market dominators in oligopolies have done throughout history. As they become more powerful they will become more blatant about using that power manipulate price of shipping or constrain supply of shipping.

[drewwollin]

Wow. So much in one video. I wish I were an academic again and could pursue this as case studies. The decreasing cost of freight is the elephant in the room; seemingly boring, but so important as globalisation increases.

I would be interested in a video on how the American domestic transport industry works. Their trucks don't seem to have changed much in decades. In Australia, B-doubles are common, with two trailers rather than one. Even with conventional truck trailers, Australian trucks have an extra axle, so 6 vs 5. The USA trucking industry seems very fragmented with a lot of inertia to change. It doesn't seem to have changed much from the east to west shipping when Europe dominated decades ago, to the west to east shipping with most trade coming from Asia. Similarly, it seems strange there are so few big ports on the west coast of the USA and then mainly in space-constrained innercity LA. Then there is the rail system too.

[michaela]

I live by the NY harbor and sometimes I go to the beach to see the monstrous container shops coming in and out of port. They look like floating cities.

[nziejeremiah]

It requires money to make money this is the best secret I have ever heard we don’t make money we make multiple money.

[TheyForcedMyHandLE]

Besides physical constraints, it seems to me that ship size would also be limited by insurability. One mishap with 30k TEUs sinking to the bottom of the sea would bankrupt company(s).

[NikitaLab]

The Box is a fantastic book on this topic, reading it right now so yet another coincidental upload.

[AsbestosMuffins]

the dumb part about containerization is the new ports partly because of the rail line's inability to adapt, and partly again by the need to union bust, were often not built with rail in mind, so even if a container ultimately gets on a train it has to be offloaded onto a truck to be reloaded onto a train instead of just going from the yard to a train and the same thing at the other end, they can't offload trains into the container yards and while this has been a problem for decades its not changing any time soon

[patrickgono]

The discussion about the emissions and the expense of alternatives is an interesting one.

On the one hand, you have giant ships carrying oil, gas, ore, and other low price but high volume resources. Any increase in shipping costs would have a dramatic effect on the cost of, practically, everything.

On the other hand, you also have similar giant ships carrying around often valuable containers -- high cost, low volume. The cost of shipping a PS5, a diesel generator, or Nike sneakers, is relatively tiny. Increase that by even 50%, and some retailers will probably just reduce their margins. Not to mention, most of the cost of shipping is accrued in the final stages -- overland shipping and final delivery.

Personally, I wouldn't mind slightly larger shipping costs for stuff that is already expensive (tech, clothing, furniture, etc.) to fund the adoption of cleaner container ships. All the while keeping shipping costs for raw resources low, in order not to hinder international supply chains, trade, and manufacturing.

[xul]

Trains are also getting so long that if they have to stop for signal, track and car issues than there tends to be extra risk to stopping the train. Bigger ships more pressure for bigger trains.