Newsletter. Line Port. Front page news page news. New Regulations on Emission Control: Implications for Short Sea Shipping.

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1 0 JanuaryJune 0 Newsletter F Front page news page news New Regulations on Emission Control: Implications for Short Sea Shipping On this edition, the front page of the Newsletter provides an opinion piece written by Alfredo Pardo de Santayana on an undoubtedly topical issue: the implications of the new emission control regulations for. This article aims to provide an overview of the problem of air pollution caused by ships, firstly by going over the basic aspects of the problem and then by referring to the reaction of the maritime community to the measures taken by the International Maritime Organization (IMO) and the European Union to control such emissions. Unfortunately, the measures are not uniform and have not been well coordinated by the aforementioned organisations either. The IMO, through Annex VI of the MARPOL convention (overhauled in 008) and the EU, by means of various Directives (999/00) and the latest proposal on behalf of the European Commission of th July, 00 to adapt the convention to European regulations, do not agree on either the specifications of the fuels and the roadmap for applying them or the socalled equivalent measures that protect shipowners if the types of fuels demanded are not available. Just to cite an example, authorities are attempting to enforce a limit of 0.% sulphur content on the fuel used by passenger ships on regular lines between European ports, not only in the ports themselves, but also in territorial waters and economic areas exclusive to the EU, regardless of whether or not they are in Emission Control Areas (ECAs). However, the current amended roadmap consists only of the obligations detailed in Table. As is known, the gases considered damaging are basically sulphur oxides (SOx), together with nitrogen oxides (NOx) and particulate matter (PM), which have a considerably less harmful impact. As regards SOx, their presence in the gases resulting from combustion is closely related to the sulphur content of the fossil fuels (heavy fueloil and gasoil) used in propulsion and marine electricity generation. The combustion of each tonne of gasoil containing % of sulphur produces 0kg of SO. ECAs in the European Union include the Baltic Sea, the North Sea and the English Channel. Table. Sulphur Content Limit in Fuel for Vessels Date a Source: MARPOL Annex VI Gasoil Sulphur Limit %m/m S0 x ECA,%,0% 0,% Global,%,% 0,% a alternative date 0, to be reconsidered in 08 These gases affect areas near the coast and, therefore, controlling them is of the utmost importance for vessels that provide services. They are responsible for causing the socalled acid rain, which seriously harms the environment when it falls on already acidic soil, such as that found in Northern Europe (and, albeit to a much lesser extent, in Southern Europe and Spain, where soils are calcareous). This is why different levels of regulation exist and geographical emission control areas have been created. Having already referred to the international regulations in Table, the only thing worth adding is that the IMO, aware of the fact that the best system for reducing emissions is to decrease fuel consumption as much as possible (a practice that shipowners are already applying), has incorporated a new aspect into its legislation that establishes criteria regarding ship Energy Efficiency, setting levels for new vessels and defining Management Plans for existing ones. In order to comply with conventions, there is no other alternative but to begin eliminating sulphur, which is a very costly process in refineries. Indeed, they are incapable even today of supplying fuel that meets the required specifications. However, it can be eliminated onboard Copyright. 009 Fundación Valenciaport. F U N D A C I Ó N valenciaport

2 0 Front page news the vessel, along with PMs, by cleaning exhaust fumes using air scrubbers. This method is also expensive and difficult to install on existing ships. As regards eliminating NOx, a rather more complex operation is required. However, this does not affect ocean carriers directly, but rather marine engine manufacturers. Fortunately, there are two solutions on the horizon that would practically solve the problem of NOx and SOx emissions. The first consists of ships using Liquefied Natural Gas (LNG) for fuel and is the most promising option for the vessels that provide services to comply with the new regulations. Natural gas does not contain sulphur and, therefore, combustion does not produce SOx. Furthermore, it has the additional advantage of reducing the CO in exhaust fumes by %. This system has been approved, is safe and viable and has been used for years by methane tankers. Using LNG also yields improved economic prospects for shipowners, as the price of gas ( to 0 $/million btu) is lower than the price of oil ( $/million btu), which at the same time dictates the price of marine fuels. Although a suitable framework for gas to be sold and supplied at ports is currently lacking, facilities are currently operating in Norway, several projects have been set in motion, shiptoship solutions have been approved and 0 ships fuelled by natural gas are currently operating. The second solution to reducing SOx consists of using shore power when ships call at port. This is another measure that is highly suited to vessels devoted to. If such vessels arrive at port, switch off their generators and connect to shore power, the problem would be solved. Installing this solution would be expensive for existing vessels, but not for new ships. For this reason, ports should invest in power plants and supply grids and the system would of course have to be extended to the main terminals in the world. Apart from the polluting gases already described, combustion also produces carbon dioxide (CO ) and water vapour. The effects of these gases are felt in the upper layers of the atmosphere, not near the coast. Considered Greenhouse Gases (GHG), they can, to a greater or lesser extent, cause global warming. the atmosphere has experienced an increase in recent years, rising from 80 ppm in the preindustrial era to some 90 ppm in 009, ecologist movements believe this gas to be the primary cause of global warming (note that the carbon cycle in nature, which is known to produce and absorb enormous amounts of CO during its biological and geochemical stages, is not taken into account). New scientific data and the sensible approach taken by the IMO in regard to this issue lead me to accept the new regulations recommending a decrease in CO output. Moreover, this coincides with the strategy of the maritime industry, working in parallel to enhance energy efficiency and seek alternative sources of energy. Finally, I would like to highlight the positive work done by the IMO in relation to maritime transport, which despite only being responsible for % of worldwide CO pollution, should also make an effort to reduce it. In fact, the industry has been doing so by implementing technologies both in the design stage and in operating vessels, all of which will result in compliance with the energy efficiency levels recently implemented by the IMO. It is also worth highlighting that the IMO has no intention as yet to adopt a system like Emissions Trading for maritime transport, as occurred in the EU at one stage, and is only studying the possibility of implementing a surcharge on the price of fuels that would accumulate in an International Fund to finance programs aimed at reducing emissions in the maritime transport industry itself. If these measures, together with those aimed at reducing sulphur are not implemented sensibly and in coordination with those of the EU, in Europe could be penalised, resulting once again in a modal shift to the road with the undesirable result of a net increase in emissions. Finally, the Maritime Sector must bear in mind that there will be changes in regulations over the next few years that will have a huge impact on the future of services in Europe, changes that should be taken into account when considering future business projects, particularly the upgrading of fleets. Alfredo Pardo de Santayana President of the Instituto Marítimo Español I am grateful to the Fundación Valenciaport for the opportunity to publish an article about the implications that the new regulations on emission control will have for (Alfredo Pardo de Santayana). Depending on the terms of the chemical reaction, every tonne of fuel burned produces between. and. tonnes of CO, which means huge quantities of this gas are being emitted into the atmosphere (more than,000 million tonnes a year). As the concentration of CO in

3 0 G Global indicators lobal indicators Global indicators s No. lines No. of shared lines No. of ocean carriers Average frequency weekly departures s No. of destination ports No. of ports with direct connections Average no. of ports connected per line 8 8 Vessels No. of vessels Capacity offered Average speed Roro Roro GT GT Total Adjusted Total Adjusted 696 6,89,790,9,98 79,6, 7,06, TEUS Lane metres/ Swap bodies 0 knots 0.7 knots Total Adjusted Total Adjusted,68,99,0,8,9,79/ 7,700,6,80/,77 Indicator calculations are detailed in the section entitled 'Methodological Notes'

4 0 s L ines Global indicators TOTAL LINES BY PORT OF ORIGIN TYPE OF FREIGHT Barcelona Valencia Algeciras Vigo Castellón Las Palmas G.C. Bilbao Tarragona Santander S.C. Tenerife Cádiz Alicante Sagunto Cartagena Gijón Almería A Coruña Melilla Pasajes Málaga Arrecife Motril Huelva Ferrol Sevilla Ceuta CONTAINERSHIP PORT OF ORIGIN INTEROCEANIC TOTAL Barcelona 6 Valencia Algeciras Vigo Castellón Las Palmas G. C. 8 Bilbao 0 Tarragona 8 S. C. Tenerife 8 Santander 7 Alicante Cádiz Cartagena Gijón Sagunto Almería A Coruña Málaga Melilla Pasajes Arrecife Ceuta Ferrol Huelva Motril Sevilla

5 0 Capacity C apacity Global indicators TOTAL CAPACITY OFFERED BY PORT OF ORIGIN TYPE OF FREIGHT GT Algeciras Barcelona Valencia Las Palmas G.C. Almería Vigo Bilbao Santander Tarragona Castellón Cádiz Gijón Pasajes Sagunto Alicante S.C. Tenerife Málaga Cartagena Ferrol Motril A Coruña Sevilla Arrecife Ceuta Melilla Huelva CONTAINERSHIP TOTAL CAPACITY OFFERED IN TEUs CONTAINER TOTAL CAPACITY OFFERED IN LANE METRES RORO Valencia Barcelona Algeciras Las Palmas G.C. Bilbao Algeciras Barcelona Valencia Santander Bilbao Almería Tarragona Castellón Vigo Cádiz S.C. Tenerife Gijón Cartagena Motril A Coruña Alicante Sevilla Arrecife Ceuta Melilla Huelva Málaga Gijón Cádiz Vigo Alicante Las Palmas G.C. S.C. Tenerife Pasajes Ferrol Cartagena Castellón Tarragona CONTAINERSHIP

6 0 Zones Z ones Global indicators TOTAL LINES BY PORT OF ORIGIN TYPE OF FREIGHT DESTINATION ZONE Valencia Barcelona Bilbao Castellón Algeciras Cartagena Gijón Las Palmas G.C. S.C. Tenerife Santander Tarragona A Coruña Alicante Cádiz Ferrol Pasajes Vigo Almería Arrecife Ceuta Huelva Málaga Melilla Motril Sevilla RoRo RoRo RoRo RoRo RoRo RoRo RoRo RoRo RoRo RoRo RoRo RoRo RoRo RoRo RoRo RoRo RoRo ADRIATIC SEA BALTIC SEA NORTH SEA AEGEAN SEA MEDITERRANEAN SEA BLACK SEA ATLANTIC OCEAN LINES BY DESTINATION ZONE ATLANTIC COASTLINE ORIGIN LINES BY DESTINATION ZONE MEDITERRANEAN COASTLINE ORIGIN ATLANTIC OCEAN MEDITERRANEAN SEA NORTH SEA ATLANTIC OCEAN NORTH SEA MEDITERRANEAN SEA AEGEAN SEA BALTIC SEA BLACK SEA AEGEAN SEA BALTIC SEA BLACK SEA ADRIATIC SEA INTEROCEANIC INTEROCEANIC 6

7 0 Global indicators Atlantic Coastline Mediterranean Coastline s s No. of lines: No. of shared lines: No. of ocean carriers: Average frequency (weekly departures):. No. of lines: No. of shared lines: No. of ocean carriers: Average frequency (weekly departures): 77. s s No. of destination ports: No. of ports with direct connections: Average no. of ports connected per line: 69 No. of destination ports: No. of ports with direct connections: Average no. of ports connected per line: 88 6 Vessels Vessels RoRo RoRo No. of vessels: Capacity offered Total GT: TEUs: Lane metres: Swap bodies: Adjusted: GT: TEUs: Lane metres: Swap bodies: Average length (metres): Average beam (metres): Average draught (metres): Average speed (Knots): Average age (years): 0,,60,0,7,,7 8, ,70,9,0,9 7,0 0,80,7 89,87 6, No. of vessels: Capacity offered Total GT: TEUs: Lane metres: Swap bodies: Adjusted: GT: TEUs: Lane metres: Swap bodies: Average length (metres): Average beam (metres): Average draught (metres): Average speed (knots): Average age (years):,9,0,70,80 9,,60 87, ,9,0,8,00 0, 6,69,9,78,98 70, / 8/ 9/7 0/7 6/6 98/ /RoRo /RoRo 7

8 0 alternative to road transport s Vessels RoRo No. of lines: No. of shared lines: No. of ocean carriers: Average frequency (weekly departures): s No. of destination ports: No. of ports with direct connections: Average no. of ports connected per line: No. of vessels: Capacity offered Total GT: TEUs: Lane metres: Swap bodies: Adjusted: GT: TEUs: Lane metres: Swap bodies: Average length (metres): Average beam (metres): Average draught (metres): Average speed (knots): Average age (years): 8,7,,,9,0,08 8, ,,,,67 68,87,,00,787,0 7, Atlantic Coastline Mediterranean Coastline s s No. of lines: No. of shared lines: No. of ocean carriers: Average frequency (weekly departures):. No. of lines: No. of shared lines: No. of ocean carriers: Average frequency (weekly departures): 6 0. s Puertos No. of destination ports: No. of ports with direct connections: Average no. of ports connected per line: 9 No. of destination ports: No. of ports with direct connections: Average no. of ports connected per line: 6 8 Vessels RoRo Buques RoRo No. of vessels: Capacity offered Total GT: TEUs: Lane metres: Swap bodies: Adjusted: GT: TEUs: Lane metres: Swap bodies: Average length (metres): Average beam (metres): Average draught (metres): Average speed (knots): Average age (years): 7,8,06,9,777,700 6, ,9,77 8,979 9,6 9,,8 7,6 0, No. of vessels: Capacity offered Total GT: TEUs: Lane metres: Swap bodies: Adjusted: GT: TEUs: Lane metres: Swap bodies: Average length (metres): Average beam (metres): Average draught (metres): Average speed (knots): Average age (years): 8 9,,66 8,,90,80 0, ,69,797,9,68 08,6 6,07,66,076,6 76,

9 0 Motorways of the Sea (MoS) Western MoS SouthWest MoS ROUTE OCEAN CARRIER TRAFFIC FREQUENCY TRANSIT TIME Nº VESSELS BARCELONAGENOA GRANDI NAVI ROPAX xweek 8h BARCELONALEGHORN GRIMALDI SUARDIAZ ROPAX xweek 0h BARCELONAPORTO TORRESCIVITAVECCHIA GRIMALDI TRASMEDITERRÁNEA ROPAX xweek /0h BILBAOZEEBRUGGE TRANSFENNICA RORO xweek 0h GIJÓNSAINT NAZAIRE LD ATLANTIQUE ROPAX xweek h VALENCIACAGLIARISALERNO GRIMALDI RORO xweek 6/6h ROUTE GT LANE METRES SWAP BODIES CAP. TEUS CAP. PASSENGER CAP. BARCELONAGENOA,9,98,68 BARCELONALEGHORN 7,67,90 89,089 BARCELONAPORTO TORRESCIVITAVECCHIA,9,96 8,8 BILBAOZEEBRUGGE 6,00,6 7 GIJÓNSAINT NAZAIRE,99, VALENCIACAGLIARISALERNO 6,869,96,0 YEAR BUILT SPEED (Knots) LENGTH (metres) BEARN (metres) BARCELONAGENOA BARCELONALEGHORN BARCELONAPORTO TORRESCIVITAVECCHIA BILBAOZEEBRUGGE GIJÓNSAINT NAZAIRE VALENCIACAGLIARISALERNO ROUTE SUARDIAZ DRAUGHT (metres) 9

10 0 Markets Services between Spain and Turkey Outstanding geostrategic location and ever closer ties with the European Union (EU) make Turkey an interesting case study for Short Sea Shipping () services. Foreign trade with Turkey is becoming increasingly significant and has grown particularly as a result of the creation of the Customs Union with the EU in 99, the objective of which is to foster economic and trade relations between the two regions. This agreement mainly affects industrial goods, while agricultural goods, services and public tenders do not enjoy the same degree of trade freedom. In order to begin to describe the services on offer from Spain, it is worth mentioning at least the most significant figures in regard to bilateral trade. According to foreign trade data provided by the Agencia Tributaria, export growth has displayed a generally upward trend over the last two decades, registering clear declines during periods of economic instability. Spanish exports to Turkey amounted to more than,700 million euros in 00, while in terms of weight the figure was in excess of million tonnes. Exports to Turkey accounted for.6% of total Spanish exports and the country was ranked th on Spain's list of most important trading partners. sea to Turkey in tonnes and the number of effective connections between Spanish and Turkish ports during the period dating from 009 to 0. While growth halted in 009 in the case of both indicators (and was negative in the case of connections), the situation clearly turned around in 00, when maritime exports picked up and this trend was emulated, albeit to a lesser extent, by the growth in the number of regular services. Figure : Spanish maritime exports to Turkey and number of maritime connections: 0090,00,000,600,00,000,000,00 800,000,000 TN 600, , , JanJun 009 JulDec 009 JanJun 00 JulDec 00 JanJun 0 Maritime Exports Nº of connections Source: AEAT and Foreign trade databases As regards the modal split, maritime transport is the main mode used to ship freight between the two countries. The maritime mode was responsible for shipping 9.% of all Spanish exports to Turkey in 00. There are several reasons for this large share, including the great distance that separates the two countries or the nature of the main goods that Spain exports to Turkey. Such goods include those under Chapters 7 (iron and steel) and 87 (Vehicles other than railway or tramway rolling stock, and parts and accessories thereof) of the combined nomenclature, which cannot be transported competitively by other modes. If we combine the foregoing information regarding trade flows with that in the database on short sea shipping services, it is obvious that both variables are significantly correlated. The graph in the opposite column compares the half yearly trend in Spanish exports by If we focus on the data provided by for the first half of 0, there were a total of 6 short sea shipping lines between Spain and Turkey, of which only one is interoceanic, while the rest fall under the definition of pure lines as established by. There are nine container lines, four lines for car carriers and two lines for roro cargo. As regards the pure connections, 9 Spanish ports are connected to Turkish ports. Average transit time between the two countries is 0 days, including an average of four calls per journey. Table displays the lines bound for Turkey from each Spanish port disaggregated by type of cargo. As can be observed, supply is significantly concentrated in geographical terms and the five main ports in terms of connections with Turkey are located on the Mediterranean coast. As regards the type of freight transported, and 0

11 0 Markets putting this into context in terms of the total lines mentioned previously, it is worth highlighting the number of Spanish ports that connect with Turkey for vehicular transport, which is in keeping with the significant share of bilateral trade between the two countries that the car industry enjoys, as mentioned previously, and which has resulted in Turkey having the largest supply of cargo for car carriers in Spain. Likewise, ports have evidently specialised in specific types of traffic, as in the case of Vigo, Sagunto and Tarragona in transporting cars. Furthermore, Valencia and Barcelona are the only ports that simultaneously offer lines for container and roro transport, although the latter concentrates exclusively on vehicle transport. In addition to this, the table details the percentage of regular services bound for Turkey in relation to total services from Spanish ports. This indicator once again clearly reveals how important Turkey is for the Spanish maritime industry, particularly in the case of carcarrier traffic. Table : Number of lines by port of origin and Ttype of cargo PORT OF ORIGIN Barcelona Source: CONTAINER CARCARRIER Valencia Tarragona Castellón Sagunto Vigo Algeciras Bilbao Málaga 7 RO RO TOTAL As regards the ports of destination in Turkey that Spain is connected to, it is worth highlighting the fact that none of the three ports with the most maritime lines are in the vicinity of Istanbul, the capital and most populated city in the country, as can be observed in Table. This is due to a large number of ports being located in the region of Marmara, precisely in the province of Istanbul, the competition between ports preventing any of them from growing markedly. In contrast, the ports in Mersin, Yenikoy and Izmir, despite being in less populated regions, have developed a larger hinterland as a result of not having any direct competitors. 0 9 TURKEY SHARE,06% 0,8%,0%,9% 7,7% 7,% 0,8%,07% 9,7% Furthermore, the s of Izmir and Mersin, which are the largest Turkish ports in terms of containerised traffic, are also confirmed to have the most container carrier lines for trade with Spain. Table : Number of lines by port of destination in Turkey and type of cargo PORT OF DESTINATION Mersin Izmir Yenikoy Borusan Evyap Estambul Gemlik Derince Haydarpasa Ambarli Tekirdag Iskenderun Source: Concentrating now on the business share of the maritime cargo market between both countries, Table presents the ranking of the top five ocean carriers to offer services from Spanish ports to Turkey according to frequency of service. Note that only the ocean carriers that operate these lines and own the vessels on them have been taken into account, cooperation contracts they may have with other carriers being excluded. Table : Ranking of ocean carriers that offer services from spanish ports to Turkey Source: CONTAINER CARCARRIER RORO As can be observed, and despite the significant market share of vehicles, the ocean carriers that offer the most frequent departures are actually transporting containers. In fact, the first two ocean carriers offer as many as four weekly departures bound for Turkey between them. 6 Gebze OCEAN CARRIER MSC BORCHARD LINES LTD ARKAS LINE GRIMALDI NEPTUNE LINES DEPARTURE FREQUENCY,06,97,9,,0 CONNECTIONS OFFERED TOTAL 6 TYPE OF LINE RoRo CarCarrier

12 0 Markets This trend is in line with the maritime transport market where ocean carriers specialised in containers try to ensure high departure frequency. Moving on, the ocean carriers that offer carcarrier services work more closely with vehicle manufacturers and distributors, clients that transport large volumes and allow them to achieve the critical mass to make a call profitable. This leads to more direct services with larger vessels, less calls and shorter transit time than container lines. Table summarises the main features of the lines that connect Spain and Turkey by type of service. to continue facilitating trade exchanges and economic development. Alejandro Lafarga Jacqueline Pérez Delia Valle Fundación Valenciaport Table : Average features of lines between Spain and Turkey by type of Service TYPE OF SERVICE CarCarrier Roro Nº OF CALLS TRANSIT TIME,0,, 9,0 0, 8, SPEED 9,7 8,9 9, AVERAGE AGE MAX. GT CAPACITY Source: Finally, Table also shows the various port of originport of destination connections that each ocean carrier has run during the first half of 0. The data reveal a clear disparity, with ocean carriers such as Grimaldi concentrating its operations in only three connections, while at the other end of the scale, Arkas and Neptune s offered almost twenty porttoport services. The fact that Turkey has a large number of ports for freight traffic implies an extensive supply and a wide range of possibilities for exporters and ocean carriers, which is clearly visible in the distribution of the market analysed. Despite the uncertainty that surrounds the economic environment in forthcoming months, and taking into account the fact that Turkey is an emerging nation and is strengthening its political and trade relations with the EU, it seems obvious to state that Turkey will continue to be an enormously important destination for Spanish industry and, in turn, maritime transport, which despite having a sound and consolidated structure as analysed, must respond to the future needs of demand in order

13 0 Recent developments R Recent develpments ecent developments in in Spain (January June 0) February February Grimaldi includes new ports in its service from the Mediterranean to Western Africa, linking Valencia to Casablanca. March Ocean carrier Brittany Ferries begins a new ropax line that connects the port of Bilbao to the British port of smouth with two departures a week. Boluda s and D'Amico Società di Navegazione restructure the services that connected the Canary Islands to Leghorn, adding new destinations such as Genoa, Casablanca and Rades (Tunisia). March April Ocean carriers China Shipping and United Arab Shipping Company (UASC) add the of Barcelona to the route that links the enclaves in the Far East and the Mediterranean, enabling a connection between Barcelona and the Said (Egypt). April Ocean carrier Wec s launches a new regular container service that links the port of Gijon to Antwerp on a weekly basis. Grimaldi sets in motion a new ropax service between the of Barcelona and the African of TangerMed that departs on a weekly basis. The consortium comprising Grimaldi and Suardiaz s reinforces the connections between the s of Barcelona and Leghorn for passenger and cargo transport by increasing the number of weekly departures to four. Ocean carrier XPress s offers a shared weekly service between the ports of Algeciras, Leixoes, Lisbon and TangerMed. May Maersk inaugurates a new weekly service that connects the of Barcelona to Genoa and Fos. Ocean carrier MEL Shipping launches a new maritime connection for containerised cargo that links the ports of Huelva and Rotterdam on a weekly basis. May Balearia includes a ropax vessel in the service that connects the ports of Algeciras and TangerMed, allowing exports to be shipped from the Spanish port. June 0 June Ocean carrier Maersk adds the port of Setubal to the route that links Algeciras to the Canary Islands.

14 0 MMethodological notes notes Methodological notes This section details the methodology used to calculate the indicators published in this Newsletter and is structured as follows: Classifications defined in the database Calculation of indicators Abbreviations used Information updating and validation CLASSIFICATIONS DEFINED IN THE LINEPORT DATABASE s studied Origin The map below shows the Spanish ports studied by the database: Spanish ports studied Source: Own elaboration

15 0 Methodological notes The following classification is obtained using the location of the Spanish ports as a basis: Atlantic Coastline: Includes the Spanish ports on the coast of the Atlantic Ocean and the Cantabrian Sea along with the Canary Islands. Mediterranean Coastline: Includes the port of Algeciras Bay, the Spanish ports on the coast of the Mediterranean Sea and the Balearic Islands. Atlantic Coastline Mediterranean Coastline Source: Own elaboration Destination The ports included in the database are located in geographical Europe or in non European countries having a coastline on the enclosed seas bordering Europe. The map below shows the countries considered by geographical region according to the following classification: Countries studied Adriatic Sea Baltic Sea North Sea Aegean Sea Mediterranean Sea Black Sea Atlantic Ocean Source: Own elaboration

16 0 Methodological notes Classification of lines Type of line The classification below was undertaken according to the route followed by the maritime services studied:. INTEROCEANIC: maritime transport services that accept freight bound for destination countries studied by the database.. : Commodity and passenger transport services by sea between ports in geographical Europe or between those countries and others situated in non European countries having a coastline on the enclosed seas bordering Europe in keeping with the definition of by the European Short Sea Network (ESN). ESN Definition of Source: Own elaboration alternative to road transport.. alternative to road transport: this category includes maritime container or roro services that we believe represent an alternative to overland transport. The traffic between Spain and countries or islands not accessible over land* (except Ireland) have therefore been excluded from this classification, along with bulk and vehicle freight and interoceanic services, as they are considered to have a series of logistical features that make road transport unfeasible or uncompetitive and can consequently be considered, to a certain extent, a captive market of maritime transport. *The routes with ports in Malta, Cyprus, Iceland, Corsica, Sardinia, the Balearic Islands, the Canary Islands, Ceuta and Melilla are therefore excluded. Source: Own elaboration 6

17 0 Methodological notes... Motorways of the Sea: Western MoS SouthWest MoS Source: Own elaboration Source: Own elaboration Western MoS: services competitive with road haulage established in the Western European corridor connecting the ports on Spain's Atlantic coastline with the North Sea and the Irish Sea, considering the port of Hamburg as the Eastern boundary of the motorway. SouthWest MoS: services competitive with road haulage established in the SouthWest European corridor connecting ports along the Spanish Mediterranean coastline to the Mediterranean coast of France, Italy and Malta. *The criteria used to select the MoS services are as follows: Minimum frequency: departures per week Maximum number of calls: *The port of Algeciras is deemed capable of offering MoS services in both the Western and SouthWest corridors. Type of line The type of line was decided on the basis of the freight transported by each service and the characteristics of the vessels used. Adhering to these criteria, lines can be classified as: : includes pure maritime container services and general freight services that accept containerised cargo. Reefer: includes maritime services that exclusively transport containers with refrigerated products. If the vessel operating on the route of a given line transports both reefers and containers with non refrigerated goods, the line will be classified as a container service. RoRo RoPax Roro Freight RoLo Car carrier General Freight Dry Bulk Oil Tanker LNG Carrier Rest of liquid bulk 7

18 0 Methodological notes CALCULATION OF INDICATORS Indicators have been calculated on a halfyearly basis, coinciding with the issue of the newsletter. For example, the sample period for the first issue of the newsletter dates from January to June, 009. In light of the fact that not all the lines included in have been operative throughout the entire period, calculations have been made taking into account the period each line has been operative. For example, a line may have provided services from January to March, but not been operative since then. The average indicators for this line will be calculated over the period the line was operative ( months). The methodology employed to calculate the indicators in this newsletter is explained below. s Total no. of lines: total number of lines in the database during the sample period, including both and interoceanic services. No. of shared lines: total number of lines operated by more than one ocean carrier. No. of ocean carriers: total number of ocean carriers that provide services over the sample period. Average frequency: average frequency of all lines, calculated as the number of departures per week offered by the lines during the period they are operative. Total lines by port of origin and type of freight: total number of operative lines during the sample period broken down into Spanish load ports, grouped according to type of line ( or interoceanic) and the type of freight defined previously. The aggregate of this classification differs from Total s as one same line is accounted for in all the Spanish ports it calls at where goods can be loaded. Total lines by port of origin, type of freight and destination zone: total number of operative lines in the sample period considered for each Spanish load port, grouped according to type of freight (container or roro) and destination zone (Adriatic Sea, Baltic Sea, North Sea, Aegean Sea, Mediterranean Sea, Black Sea or Atlantic Ocean). The referred graph indicates that the top ranked port of origin will be connected with the highest number of destination zones. This does not mean the port in question offers the largest number of maritime connections. As in the previous case, the aggregate of this classification differs from Total s and Total s by of Origin grouped according to type and freight. s No. of destination ports: total number of foreign ports of destination connected with Spanish ports. No. of ports with a direct connection: total number of foreign ports of destination connected with Spanish ports without calls at other ports en route. Average no. of ports connected per line: average number of calls for all lines, considering all Spanish and foreign ports where the vessel calls. Vessels No. of vessels: total number of vessels deployed for all the lines that are operative during the period under consideration. 8

19 0 Methodological notes Average speed: average maximum speed of the vessels that operate on each line in knots, distinguishing between maritime services for containerised transport and lines for roro freight. Effective speed: average real speed of the vessels that operate on each line in knots, calculated using the real average distance covered and average transit time as a basis and distinguishing between maritime container and roro services. Real distance in nautical mile specifies the distance actually covered by a vessel between the port of origin and the port of destination that the freight is bound for. This calculation therefore includes the distance covered by the vessel throughout the entire voyage, including any calls made at ports en route. Total and adjusted capacity: calculated bearing in mind the frequency of the line and the characteristics of the vessels that operate on the route. Due to the fact that the load capacity allocated to a port does not coincide with the maximum capacity of the vessel on certain routes, the concept of adjusted capacity has been used. This figure is the result of applying a weighting factor to the total capacity of the vessel. The factor will only be applied to the maritime services that make more than two calls in total. Total capacity offered in GT: total GT offered by each line. Total capacity offered in TEUs: total TEUs that can be transported by container and reefer carrier lines. Total capacity offered in LANE METRES: total lane metres of capacity that roro lines can offer. Total capacity offered in SWAP BODIES: estimate of the total number of swap bodies that can be transported by the vessels that operate on all roro lines. The estimate was calculated by dividing lane metres by a conversion ratio of. Adjusted capacity offered (GT, TEUs, LANE METRES and SWAP BODIES): calculated using total capacity offered as a basis and applying an adjustment factor: s: the adjustment factor is calculated on the basis of the Spanish ports that intervene on the route of the vessel for a given maritime connection and the total number of calls. Adjusted capacity = Total capacity * (No. of Spanish ports/total no. of calls) lines: as the ultimate purpose of these lines is to transport freight between large geographical regions (e.g. Far EastMediterranean line), a correction factor of 0. is added to the foregoing adjustment ratio to calculate adjusted capacity. The correction factor stems from the hypothesis that only 0% of freight will be bound for the ports studied by. Adjusted INTEROCEANIC capacity = [Total capacity * (No. of Spanish ports/total no. of calls)]*0. GT capacity by port of origin: sum of total capacity offered by each Spanish port of origin according to the type of line and freight. Once again, the aggregate of this classification will differ from the general total. TEUs by port of origin: sum of total capacity in TEUs, broken down into Spanish ports of origin that offer maritime container and reefer services. LANE METRES by port of origin: sum of total capacity in lane metres broken down into Spanish ports of origin that offer maritime roro services. Average length, beam and draught: average characteristic dimensions of the vessels in metres, distinguishing between vessels used for container cargoes transport and those used for roro freight. Average age: average age of vessels that operate on each line in years. This figure is obtained by subtracting the year the vessel was built from the current year. 9

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21 F U N D A C I Ó N valenciaport LEGAL DEPOSIT: V60009 ISSN: 770 Fundación Valenciaport Nueva Sede APV (Fase III), Avda. del Muelle del Turia, s/n 60 Valencia Tel Fax: info@fundacion.valenciaport.com