Russia to set up Arctic container shipping line

Russia is looking to set up a state-run containership operator to support its efforts to develop the northern sea route in the Arctic region, Bloomberg reports.

Russia’s Deputy Minister of the Far East and Arctic Development Alexander Krutikov said in an interview that the ministry, together with Russian think-tank Skolkovo, is working on a project to create a state-run container ship operator.

“The state pays for the Arctic exposure and the shippers cover the remaining costs themselves,” Krutikov said, adding that costs for shipping companies to use the northern sea route should eventually be lower than transiting the Suez Canal.

According to Krutikov, feeder ships from European and Asian ports could sail as far as Murmansk in the Barents Sea and Kamchatka in the Far East, bringing cargoes to transshipment points, and from there, the Russian container operator would take responsibility for the cargoes and will keep transshipment costs competitive in order to promote the route.

Krutikov believes the national container operator would have to work alongside international shippers for at least a decade before the route is commercially viable.

Currently, vessels can only use the northern sea route at certain times of the year and need icebreakers at some parts of the route.

There has been much debate on the adoption of northern sea routes in the shipping industry. In the past few months, major boxship operators including CMA CGM, Hapag-Lloyd and MSC have officially declared that they would not use the Arctic routes due to environmental concerns.

Another three shipping majors, Maersk, MOL and Cosco, have all completed trial Arctic voyages in the last couple of years.

In June, Russian state-run shipping major Sovcomflot and energy firm Novatek signed an agreement with Chinese state-run shipping conglomerate Cosco Shipping and Silk Road Fund to establish joint venture Maritime Arctic Transport.


Jason Jiang

Jason is one of the most prolific writers on the diverse China shipping & logistics industry and his access to the major maritime players with business in China has proved an invaluable source of exclusives. Having been working at Asia Shipping Media since inception, Jason is the chief correspondent of Splash and associate editor of Maritime CEO magazine. Previously he had written for a host of titles including Supply Chain Asia, Cargo Facts and Air Cargo Week.
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