TT Talk - The strength of the tank container supply chain
UN portable tanks (tank containers) have been used in the international supply chain to distribute bulk cargoes for many years. Having such a deep heritage in the insurance of the maritime containers, naturally TT Club has intimate understanding of the tank container sector, with a current insurable interest in around 53% of the global tank container fleet.
March 2020, the International Tank Container Organisation (ITCO) released their 2020 Global tank container fleet survey. This annual survey has become a valuable publication for the industry. It provides a breakdown of the current global fleet, coupled with an overview of both the historic and future trends and developments of the tank container industry. TT Club is proud to continue its Associate Membership of ITCO, supporting the work the organisation undertakes. In profiling the survey, this article seeks to recognise ITCO’s continuing high investment in the industry.
While, of course, covering a period prior to the COVID-19 pandemic – the 2020 survey highlights a slowdown in the growth of the global fleet in 2019 (7.88%) versus 2018 (10.81%), partially reflected by the fall in global trading conditions experienced by many sectors of the container shipping industry. Positively, the global tank container fleet continues to expand, attributed to shippers recognising the benefits of shipping their cargoes in tank containers (in favour of drums or parcel tankers). The survey reports strong growth for Chinese domestic bulk liquid movement as well as intra-Asia trade.
“the global tank container fleet continues to expand, attributed to shippers recognising the benefits of shipping their cargoes in tank containers, in favour of drums or parcel tankers”
The report notes that the number of tank containers produced in 2019 was lower than in 2018, further suggesting that there will be challenges ahead for manufacturers unless the market sees a significant turnaround. The survey shows that, in 2019, a total of 54,650 tank containers were built (predominantly in China), compared to 59,700 in 2018 – a decrease of some 5,000 units.As in previous editions, this ITCO fleet survey is broken down to illustrate ownership facts and trends. The industry is divided between those owner/operators and lessors – lessors accounting for the largest proportion of units globally.
The 2020 ITCO survey identifies a total of 218 operators. The top 10 operators account for over 235,000 tanks representing over 56% of the global operators’ fleet; the market thereafter is fragmented. The proportion of the global fleet owned by operators showed a slight increase through 2019.
The survey identifies 37 leasing companies marshalling 305,615 tanks. The top ten lessors dominate with about 79.5% of the total leasing fleet, while the top three companies account for 154,500 tanks of the total fleet (50.5%) – a 3.5% reduction on last year.
The report notes that the majority of new tanks in 2019 were purchased by leasing companies, primarily to service the operator requirements. One consequence of more lessor-owned tank containers being available is that it facilitates growth in the number of 3PLs and 4PLs entering the market. Worryingly, the survey notes that such companies “often have little – or no – accredited infrastructure to support their growing fleet of tanks”.
Unsurprisingly, the survey states that tank container manufacturing is concentrated in China; the only significant exception being based in South Africa. The top seven leading tank container manufacturers represent 93% of global manufacture. The report observes an active and growing specialised tank sector, while noting that the majority of production goes to industry standard tanks.
In recognition of the importance in investing in the future of the industry, both promoting the use of tank containers and also educating current and future stakeholders, ITCO has developed an industry specific e-learning course, in conjunction with EXIS Technologies, focused on all aspects of the tank container and its safe operation. TT Club commends this as a valuable resource for those working in or seeking to enter the industry.
“TT Club commends this as a valuable resource for those working in or seeking to enter the industry”
Continuing their future perspective, in November 2019, ITCO donated a 20ft ISO tank container to the Shanghai Maritime University, China’s leading academic institution for the shipping, ports and logistics industry. The tank will be used for training and education purposes. It was provided by ITCO member Exsif Worldwide, with the fittings supplied by Fort Vale Engineering. The tank’s manufacturer, CIMC, prepared the tank for the University and additionally built the access ladder and walkway. Technical expertise and logistics were supplied by Stolt Tank Depots.
New TT Club guidance
Similarly, building on the success of TT Club’s tank container seminar in the latter part of 2019, which was referenced in previous TT Talk coverage, and in order to provide greater understanding for those businesses entering or on the periphery of the industry, TT Club has collaborated with a number of experts to produce new guidance focused on managing risks in the tank container supply chain.
This latest addition to the StopLoss series is intended to be a practitioner’s good practice guide covering all stakeholders through the tank container transport chain whether operating, filling, discharging, cleaning or handling tanks. Informed by typical incidents, the document is structured in such a way that it follows the natural chronology of the transport chain in order to provide ease of access. The publication incorporates several pieces of valuable operational reference material, with references to the applicable regulations, concluding with a 13-point checklist aimed at supporting consistent and successful outcomes for the tank container supply chain.
“StopLoss is intended to be a practitioner’s good practice guide covering all stakeholders through the tank container transport chain whether operating, filling, discharging, cleaning or handling tanks”
We hope that you have found the above interesting. If you would like further information, or have any comments, please email us, or take this opportunity to forward to any colleagues who you may feel would be interested.
We look forward to hearing from you.
Risk Management Director, TT Club