Home / Shipping News / International Shipping News / Baltimore port impact felt on cars and consumer goods/shut down this year

Baltimore port impact felt on cars and consumer goods/shut down this year

Commenting on the impact of the Baltimore bridge collapse, Mr. John Kartsonas, a well-known shipping analyst and investor for over 20 years, said that “this is a horrific event. There are numerous factors into play when it comes to the accident, as the safety standards and procedures for ships sailing through such tight waterways globally are quite high. However, a potential mechanical failure seem the most likely scenario at first and similar to other high profile shipping accidents (Evergrande Suez Canal blockage the other recent one) it will create disruptions in global trade, some that will be felt in the US market, given the importance of the Baltimore port when it comes to importing cars and consumer goods through containers, with a long time expected for the ports terminals to be essentially closed for business.

From a shipping perspective the first thing you have to do as a shipping company is obviously find what went wrong. These are state of the art ships especially this one involved in this accident which is a brand new ship which is less than 10 years old and built in Korea. These are high quality ships so it’s a very it’s a very unlikely phenomenon that you get something like this situation. The other thing is obviously you have to look at the human error, but when the ships approach boards or tight waterways or areas that they don’t know very well, you have experienced personnel that gets on board from the port called pilots. They are the ones who can steer the ship through the waterway. There are a lot of elements here: One is obviously the human element and the other is the mechanical failure, which seems to be the case here.

There are not very few incidents events of this type globally where it impacts ordinary citizens. This will take a very long time and it will have multiple agencies and organizations involved especially given the magnitude of this situation.

Given this is state of the art equipment on board and very experienced pilots and captains that are going to steer the ship to go towards the ocean it’s clear given the videos there’s a blackout happening just moments before the collision. We don’t know what was happening at that point on the bridge of the ship but it seems that a blackout where basically everything stops, the engine stops there. On this kind of shop with no power there is no way you can steer the boat away from either currents or if possibly the rudder got stuck. But it seems like a mechanical failure is the most likely scenario here.

Baltimore is very significant in terms of specially of consumer goods, cars and other things the US imports from abroad. This is not as significant in the commodities business. They do export coal from the Baltimore area, but probably what’s going to be affected most is deliveries of new cars, for example, or consumer goods. There is a lot of other areas that can pick up the slack like the new New York Harbor and all the way down to Savannah, Georgia so there are alternative destinations. It will take a while for the situation to resolve and to begin operating normally again. So definitely there will be delays in deliveries of goods. Hard to say when Baltimore will come back on line but it wont’ be this year.

Why ships aren’t built in the US? It’s cheaper and more efficient to build it abroad. The US maritime business was thriving 150 years but this has changed over the years. Right now Asia and some European countries are dominating the global shipping space because of cost. You can build a ship in the US but it’s going to cost two or three times more because of like the protectionism that the shipping industry is enjoying the US”, Mr. Kartsonas concluded.

Mr. Kartsonas is a managing partner of Breakwave Advisors, as well as the BDRY and BWET ETFs which are investment products investing in shipping rates.
Source: John Kartsonas, Breakwave Advisors

Recent Videos

Hellenic Shipping News Worldwide Online Daily Newspaper on Hellenic and International Shipping
error: Content is protected !!
×