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Ports of LA, Shanghai Strike Transpacific Green Deal

When it’s deliver-or-die, supply chains become the lifeblood of a company. To that end, the fashion industry has embraced technology to navigate today’s hyper-complicated supply chain, with myriad solutions shaping the first, middle and last mile. Call it Sourcing 2.0.

An aggressive new plan to green the route between the ports of Los Angeles and Shanghai comes as the maritime and other supply chain stakeholders assess their environmental impact.

The pact, struck in late January and called the Green Shipping Corridor, aims to trim greenhouse gas emissions generated in this decade with an initial goal of eliminating fuel-powered ships by 2030 for one of the busiest cargo routes.

“International collaboration is essential to decarbonize global supply chains,” Port of Los Angeles executive director Gene Seroka said of the new pact.

Seroka went on to add, “It’s time to get started on this important work.”

The partnership involves the two ports, along with C40 Cities, an organization made up of mayors from nearly 100 major metropoles with the aim of addressing climate issues.

Los Angeles Mayor Eric Garcetti chaired the organization between 2019 and 2021, stepping into the role as the group launched its Global Green New Deal framework of climate commitments. Garcetti, during his time as chair, also established the Green Ports Forum, a group of 20 ports globally dedicated to greening the supply chain.

More specific plans and milestones for the Green Shipping Corridor are expected by the end of this year.

The plan to make the L.A.-Shanghai cargo route more mindful of the environment is not being done alone, with buy-in from shipping lines and cargo owners that include A.P. Moller-Maersk, CMG CGM, Shanghai International Ports Group, COSCO Shipping Lines, the Aspen Institute’s Shipping Decarbonisation Initiative and its Cargo Owners for Zero Emission Vessels (coZEV) and the Maritime Technology Cooperation Centre – Asia.

The Aspen Institute launched coZEV with a focus on greening the maritime industry by getting companies to make the switch to zero-carbon fuel ships by 2040. It launched in October with Amazon, Patagonia, Ikea and Unilever among the initial companies to sign on.

The conversation around decarbonization is not a new one for the shipping industry and the topic, not surprisingly, came up last week during the Maritime and Ports Symposium that kicked off the three-day Manifest logistics conference in Las Vegas.

“Prior to the pandemic, decarbonization was the focus. That didn’t go away and is still a central issue. How we do it is going to require massive R&D and CapEx,” said Chris Clott, co-founder of maritime content platform Marine Startups, during a Manifest panel on industry innovation.

Several others on the panel echoed the question of how to fund decarbonization efforts, but many cited Maersk as a leader in efforts to move the green needle.

“I guess from my perspective, you’ve just got to do it and there’s operators that are doing it and you see them over in Europe,” Sea Machines Robotics Inc. CEO and founder Michael Johnson said of decarbonization on that same panel.

Johnson, whose company is focused on technology around ship autonomy, pointed to electric and hybrid ferries in Europe, along with Maersk’s net zero emissions target and development of carbon neutral containerships powered by methanol.

Digital tools could help the industry get where it wants to go, added Nick Chubb, founder of maritime research firm Thetius.

“2020 was a massive accelerant of that and the investments made in the infrastructure,” Chubb said. “I think we’re just at the cusp where we’re going to see a huge number of not just solutions, but a huge demand for solutions.”

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