Nearly everything we buy is made overseas.No matter where you live, it’s likely that the majority of products you use on a dailybasis are made outside your own country’s borders. Even at the supermarket it’s commonto see fresh food that was grown or caught on the other side of the world. Not long ago,this would have been unheard of.
Everything had to be produced close to the consumer.It just wasn’t profitable to ship goods over long distances. Only luxury and specialtyitems were shipped from overseas. Very few commonplace items were produced more thana couple hundred miles away from the final market. That all changed on April 26, 1956,when the Ideal-X, a converted World War Two tanker left Newark, New Jersey on its maidenjourney. What was so special about this journey was that it was the first time in historythat a ship had its cargo packed into containers, rather than just loosely placed throughoutits holds. This seems like a simple and uninfluential concept, but this idea changed our world.
Before the Ideal-X, cargo was brought to port in trucks and loaded onto ships piece-by-piece.Whisky and rice and hammers and everything was packed tightly in the hold, and the wholeloading process took more than a week. This technique, known as break bulk cargo, datedback to the time of the Phoenicians. It was said that the dock workers wages were “twentydollars a day and all the Scotch you could carry home,” because theft of goods wasso rampant. This needed to change. Malcolm McLean, a trucking company owner, sold everythinghe owned to buy a ship and develop the system of containerization. Unbearably simple, hedesigned a corrugated steel box and created some trucks and a ship that would seamlesslyhold these boxes. This connected the manufacturer straight to the consumer.
Manufacturers wouldload these boxes, then no hands would touch the merchandise until the container was deliveredto the vendor, distributor, or consumer. One of the most amazing aspects of this systemof this system it became universal. We can’t even agree on currency, plug type, DVD standard,or even which side of the road to drive on but we can agree, across the world, on theone size of shipping container. A container loaded in Kansas will fit on the train thattakes it to the dock, then fit on the boat that takes it to China, then fit on the truckthat will take it up to Russia. Even some planes are now being designed to fit intermodalcontainers. Theres no need for logistics, no need for calculations, no need for worryingif the container will work in faraway countries.
But what really changed our world was howquick this system made the loading process of a ship. What used to take more than a weekcould now be done in a matter of hours. Shipping costs plummeted after the introductionof this system. Whole cities, such as Newark and Oakland were put on the map because oftheir new, larger ports that were needed in response to the shipping boom. This systemalso helped create the global economy that we have today, one where one car has elementsfrom dozens of countries across the world. Its now cheaper to manufacture many goodson the other side of the world because shipping is so inexpensive. Containerization was thegreatest driver of the development of a global economy and trade network. The intermodalcontainer cut shipping time from Europe to Australia down from 70 to 34 days withoutincreasing the speed of the travel.
We are still witnessing the aftermath of this innovationtoday. Between 1993 and 2002, the average distance of a cargo shipment grew by 40%.This means that goods are still being manufactured farther and farther away from their market.The value per ton of cargo is also dropping. More and more cheap items are being shippedfrom far away to be sold. However, many believe that containerization could have been thelast great innovation in shipping. Boats can’t really go any faster while stillbeing profitable. 15 knots is the average speed today for cargo ships and it’s unlikelythat this speed will increase in the near future.
To make shipping faster and cheaper,one needs to find other ways to speed up the process. There are some small changes beingdeveloped, such as the automatization of ports and the further specialization of ships, howeverthe greatest innovation for shipping may come from the greatest threat to mankind. Globalwarming is opening new routes for shipping. The once frozen Northeast passage north ofScandinavia and Russia now can be sailed on for a few months of the year. In 2009, a Germancargo ship became the first commercial vessel to sail this route, and today multiple shipsuse this route every year.
The route shortens the shipping time between Europe and Asiaby days, avoid the pirate infested waters of the Red Sea and Gulf of Aden, and saveson average $300,000 in fuel per vessel per voyage.So there you have it. Thats how a metal box changed our world. Without that box we wouldn’thave our phones from China, our clothes from Bangladesh, or even our oranges from Florida.Freight shipping is the behind the scenes process that has made our world what it istoday. Our economy and our lives would not be the same without this innovation. Containerizationmay be little known, but its affects are more evident than almost any other invention ofthe 20th century.