As the ice continues to melt at the top of the world, climate change is altering more than global weather patterns.
The opening up of Arctic waters as summer sea ice continues a thirty-year retreat trend could cut a third off distances between North-West Europe and the Far East. With the UN Panel on climate change predicting a nearly ice-free Arctic Ocean in September before 2050, there is an expectation that the patterns of world trade are poised to go polar.
But, in a region where favorable market conditions, good weather guarantees, and non-linear climate shifts are all uncertain, it is too early to quantify the effects of Arctic sea routes on global shipping trade.
A rapidly warming Arctic is making three passages more accessible for trade in the High North: The Northeast or Northern Passage connecting the Atlantic to the Pacific through Russian waters; the Northwest Passage running through the Canadian archipelago; and the Transpolar Passage, passing through international high seas of the Central Arctic Ocean.
Long stretches of time that are free of sea ice are needed in order for any one of these passages to become the future “Suez of the north.” In current conditions, trade ships require an icebreaker escort, priced at roughly 400,000 USD, to make the journey. While it might seem that a warmer Arctic means less need for icebreaking, more traffic and shifting climate conditions will cause seas to freeze irregularly. Unpredictable ice conditions increase hazards for commercial ships and intensify the Arctic’s complex risk environment, making the need for icebreakers all the more important.
Russia has 40 active ice breaking ships. The United States has two heavy ships in active operation, Canada holds six medium and small-sized icebreakers, and China, Japan and South Korea each own one. While a number of countries are currently building or are planning to build more, ships capable of breaking through multi-year ice are not cheap. Each heavy icebreaking ship comes at a price tag of roughly one billion USD and can take up to a decade to build. Even with icebreakers, irregular ice floes and inconsistent weather may keep Arctic navigation too unpredictable for the tight delivery schedule of container shipping.
Beyond ice, port infrastructure is critically underdeveloped to support circumpolar shipping. Although Russia has begun to reopen dormant research stations and Arctic ports, Canada has not yet made basic investments to augment its scant trade infrastructure. This translates to minimal search and rescue capabilities in emergencies and increased insurance rates, offsetting some of the route’s potential savings.
These on and off shore restraints on trans-Arctic trade are not trivial. Last year, over 17,000 ships traversed the Suez Canal in Egypt. In contrast, only 31 ships used the Northeast Passage – the preferred passage by most economic analysts – in full to make the journey from Europe to Asia.
Still, if operating in reliable conditions, all three shipping lanes significantly reduce transit time. In the long-term, routes like the Northeast Passage may prove a viable alternative for bulk cargo shipping of Arctic hydrocarbon resources. Using the Passage, a 2012 tanker transporting over 100,000 cubic meters of liquefied natural gas from Norway to Japan saved 20 days, and about 1,000 tons of fuel, compared to the traditional Suez Canal route.
The “Polar Code,” a framework developed by the International Maritime Organization (IMO) and adopted by the UN in May 2015 will legally guide the prospective uptick of more tankers following the 2012 Norway-Japan journey. Taking effect in January 2017, the code set rules on safety to protect ships, crew, and the Arctic’s fragile ecosystem.
However, enforcement of the Code has yet to be determined, and important issues like heavy fuel oils, the introduction of invasive species, and an action plan for oil spills have not been developed. While the macro effects of Arctic shipping routes on the patterns of global trade are still to be seen, even one additional trans-Arctic trip increases the potential for a devastating human or environmental accident. It is now, in the early days of Arctic trade expansion, that polar maritime law like the Polar Code must be strengthened to prepare for the potential of long-term increased marine traffic.
