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Shifting trade flows – braving rough seas

Photo: UNCTAD Rebeca Grynspan, the Secretary- General of United Nations Conference on Trade and Development (UNCTAD)
Dubbed the "can do shipyard" for its shipbuilding and repair efforts in World War II, New York's Brooklyn Navy Yard hoster the plenary session on the first day of the Global Maritime Forum’s 2022 event last week; it was a venue that dovetailed with the theme of opening session “Braving Rough Seas”.

The theme of the session was highlighted by an impassioned speech by Rebeca Grynspan, Secretary-General of United Nations Conference on Trade and Development (UNCTAD), who described the international business as being on the precipice of an historic crisis, actually one component within “a cascade of crises”.

Grynspan, whose efforts were integral in opening up grain and fertilizer movements out of the Black Sea, where she noted that more than 4 million tonnes of grain have moved out of Ukraine, spoke about food and fertilizer cargo issues but also got onto the subject of LNG moves.

At a high level, she spoke about trade re-alignments, which she described as “rough, costly, and messy.” She, followed up, saying, “precisely because of that it will be a huge opportunity for the maritime business. As maritime routes become longer, whole new supply chains are built, new ports join the global trade, we will more and different ships, new ports, more terminals, bunkering stations and new capacities for businesses, crew and dock workers.”

On the subject of ongoing trade flow shifts, including longer voyages, she commented that: “A case in point is what is happening in natural gas. The seaborne LNG market has taken off this year, as a way to cope with gas pipeline disruptions. For the first time in history, this year at least half of Europe’s natural gas consumption will be brought by ships. The problem is that there might not be enough LNG to go around – we are already seeing reports of countries in Asia being priced out of LNG spot markets.”

Imploring the maritime industry to be pro-active in confronting such problems, she continued: “According to UNCTAD calculations, the LNG market is missing around 50bn cu m of gas to meet everyone’s demand, about 10% of last year’s total LNG exports. This is why your investments are so important. We need more, and not less, LNG carriers and infrastructure.”