CSCMP's Supply Chain Quarterly
October 24, 2018
Forward Thinking

More ships will traverse Arctic sea route from Europe to Asia

With warmer temperatures causing sea ice to melt in the Arctic, supply chains may shift northward.

Will global warming open up new transportation routes? If the events of the last two summers are any indication, the answer appears to be "yes."

Warmer temperatures are creating ice-free routes in the Arctic Ocean during the Arctic summer, and oceangoing vessels are beginning to take advantage of the shorter passage from Europe to Asia. In September of 2009, two German cargo ships traversed the so-called "Northern Sea Route" along the coast of Siberia to Asia, and this summer Baltica, a 100,000-ton Russian-flagged tanker, sailed from Murmansk to China, the first such voyage by a large tanker. Baltica saved itself 5,000 nautical miles of travel; the Northern Sea Route is about 7,000 nautical miles long, compared to 12,000 nautical miles for the traditional route through the Suez Canal.

Currently, the entire length of the Northern Sea Route is open to ships for less than two months in late summer, although some sections are navigable for as long as seven months out of the year. Still, decreasing sea ice in the Arctic could prompt more ocean carriers to attempt a northern passage. According to a report in The Barents Observer newsletter, by mid-November the multinational Administration of the Northern Sea Route had already received applications for five tankers and five bulk carriers to transit the route in 2011. And at a November transportation conference in Russia, Murmansk Oblast Governor Dmitry Dmitriyenko predicted that cargo transport through the Northern Sea Route would increase from just over 2 million tons in 2010 to some 19 million tons in 2020. (Much of the current tonnage travels just a portion of the total route.)

One futurist, University of California at Los Angeles professor Laurence Smith, argues in his book The World in 2050: Four Forces Shaping Civilization's Northern Future that global warming could make Canada and Scandinavia the next big economic powers. Not only will new shipping lanes lead to increased trade with northern nations, Smith predicts, but new reserves of oil and gas will be discovered and crop production will increase in those regions.

For more on the topic of Arctic sea routes, see "Northern exposure" in the "Forward Thinking" section of the Q3/2008 issue.

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