high productivity which yields lower unit transportation system costs in spite of the high capital investment:

1. Loading and unloading time and expense is reduced dramatically. 2. Ships utilization in line-haul service is materially increased and unproductive port time reduced.

3. Crew costs per unit of ocean shipping are drastically reduced, because high-volume equipment increases their productivity.

4. Capital and fuel inputs are relatively larger and crew costs are relatively smaller per unit of ocean shipping.

The success of the Sea-Land and Matson domestic containership operations have demonstrated the technical feasibility and economic advantages of ocean container ship service under U.S. conditions. Container service by several lines or groups of lines will be underway in the United States to North Atlantic trade by the end of 1966.

Furthermore, the development of integrated transportation system is relatively new particularly for ocean foreign trade. The fact that two unsubsidized operators are seriously considering the construction of large container ships with high speed and power requirements, 60,000 shaft horsepower and over, is significant evidence to support predicted trends for greater use of large, fast, specialized ships.

FOREIGN TRADE POTENTIAL FOR CONTAINER SHIP OPERATIONS

It is always difficult to accurately forecast potentials of a revolutionary new development in transportation because new demand potentials are opened up for which no experience is available. The advent of railroads made possible the agricultural and industrial development of the U.S. Midwest not possible with existing water transport. The introduction of jet airplanes has made possible transcontinental 1-day business conferences and 2-week European vacations. Container ship operations may well make possible the exchange in foreign trade of a wide range of commodities not heretofore possible because of high freight costs.

Analyses of world trade indicates that at the present time, over 70 percent of the break bulk cargo carried is adaptable to containerization. It seems reasonable to assume that within 10 to 15 years containerization exceeding this magnitude will take place.

Number of fast turnaround container ships possible, 1970-90

It is possible to make a rough approximation of the minimum number of giant container ships (defined as 900 to 1,000 feet long, carrying about 3 million cubic feet of container space with a speed capability of 25 to 30 knots and requiring 50,000 to 140,000 shaft horsepower) needed in the period 1970-90 by making a few assumptions about U.S. liner trade and the carrying capacity of giant container ships.

Current inputs for estimating merchant marine requirements give C-4 type break bulk ships in the liner trade about 50,000-long-ton annual capability. Averages assumed for U.S.-flag liner ships for 1970, 1985, and 1990 are:

If we assume that the giant container ship carrying 1,200 40-foot containers can do six times as much work as the C-4 average for 1990, the average annual productivity would be 300,000 long tons. If we assume that the giant or an even larger ship (or concentration on the short European run by large ships) can do eight times the work of a C-4, the average annual productivity would be about 400,000 long

tons.

The increase in general cargo foreign trade between 1970 and 1990 is estimated at 20 million long tons (table 5). At current rates of U.S.-flag fleet development, only about 1 million long tons of the increase would be carried by conventional U.S.-flag ships. If only half the remaining estimated increase (9,500,000 long tons) were to be carried in U.S.-flag giant container vessels, it would require about 32 at 300,000 long tons capability or about 25 at 400,000 long tons capability, considering the inbalances in trade patterns.

The giant container ship assumes 3 million bale cubic capacity. The number of ships required would be doubled for large container ships with only about 1,500,000 bale cubic capacity.

The figures above assume no increase in trade because of lower real costs of ocean transportation, assume no decrease in conventional type U.S.-flag vessels, and assume that U.S.-flag ships (container ship and conventional liners) still have something less than 40 percent of total U.S. liner trade by 1990.

All the above estimates may be conservative:1 (1) Total foreign trade may grow faster than the 3.5 percent per year postulated by the Maritime Administration for foreign trade projections; (2) lower real ocean transport costs may increase transoceanic trade; (3) giant container ships may displace a significant number of break bulk ships.

Thus the minimum number of giant container ships which could easily be accommodated in the U.S.-flag liner trade is 25 to 32. The number could conceivably be higher with expanding trade, fewer C4 type ships, and lower real costs of ocean transport.

1 It is assumed that the costs of operating large aircraft introduced in 1970 and beyond will remain too high to become a significant factor in transoceanic cargo weight lifted. The attraction of high value cargo to aircraft may affect ocean freight rates, however, by taking away high revenue cargo and forcing a restructuring of rates on medium and lower value cargo.

TANKERS

The most rapidly growing aspect of world trade since World War II has been the carriage of liquid petroleum. The evolution of the tanker trade is familiar to all who have been aware of ocean transportation trends. The growth and size of the ships in this trade has been dramatic. The war-built T-2 (about 16,000 deadweight tons capacity) marked the beginning of this trend by proving the advantage of the larger tanker. The increased reliance on the Middle East as a source of petroleum for Europe, Japan, and the United States, and the need for optimum vessel economy for this long movement has accelerated the development of large tankers. Thus, both the number and the size of vessels has grown since demand for oil from long-haul sources has increased more than demand for oil which can be moved overland or via shorter sea routes.

In 1954, about 61.2 percent of the world tanker fleet had a carrying capacity under 17,000 deadweight; 33.4 percent between 17,000 and 29,999 deadweight; 5.4 percent between 30,000 and 49,999 deadweight; and none were 50,000 deadweight and over.

The situation in the last decade has changed quite rapidly. In 1964, about 14.3 percent of the tanker fleet had a carrying capacity under 17,000 deadweight; 28.8 percent between 17,000 and 29,999 deadweight; 35.6 percent between 30,000 and 49,999 deadweight; and 21.3 percent 50,000 deadweight and over.

1

At the present time, there are 60 tankers over 100,000 tons deadweight in operation or under construction (16 in operation and 44 under construction). The largest of those now under construction is the Idemitsu Maru, with 205,000 deadweight. The Gulf Oil Co. has recently announced to the press 1 that they plan to operate six gigantic 300,000 ton oil tankers for the transportation of oil from the Middle East to Europe. These ships, though having the usual speed of only 1611⁄2 knots, will require 60,000 to 70,000 shaft horsepower plants. In a recent study, it was predicted that by 1980 a limited number of tankers of 500,000 deadweight would be built. This trend to large size tankers will necessitate the use of powerplants in the 60,000 and higher shaft horsepower range. Accurate predictions as to the number of vessels with power in excess of 60,000 to 70,000 shaft horsepower in various time periods is, of course, most speculative. However, if tankers such as those proposed by Gulf are built, it seems reasonable to believe that others will follow.

DRY BULK CARRIERS

Dry bulk carriers are those ships which customarily carry single types of bulk cargoes, excluding tankers. Most of the world's bulk trade consists of commodities such as grain, ore, coal, fertilizer, etc. As of January 1966, the world bulk fleet was composed of approximately 1,168 ships. The size distribution of these ships is shown in table 6:

1 Business Week, May.

81-840-67

Dry bulk ships are generally smaller than tankers with only two vessels in operation of 80,000 deadweight tons or over. The speed of these ships is also generally slower than tankers with 15 knots being the most common. Tankers are generally well below the 15 knot range. As of January 1, 1966, the size distribution of bulk carriers on order is shown in table 7:

The experience in dry bulk ships shows a trend toward larger ships but not to the extent indicated for general cargo ships and tankers. The largest bulk carrier now under construction is 144,000 deadweight tons with a speed of 1514 knots. This ship will require an estimated 20,000 shaft horsepower to meet this speed reqirement.

The size of bulk carriers is affected by the magnitude of cargo offerings as well as the limitation of port facilities. Off loading of bulk carriers is less efficient than off loading of tankers. The dramatic size growth of tankers has not been extended to the bulk carriers because of these limiting restraints.

Very little additional growth for the largest class of bulk carriers is predicted during the next 20 years.

SUMMARY

Since World War II there has been a continual increase in the size, speed, and power of all kinds of ships. The increase from 15,000 to

7,000 deadweight tons in tanker size has been the most dramatic. e increase in power requirements for ships handling general cargo 11 be equally dramatic if the increase from the 6.000 shaft horsewer of the war-built ships is carried up to the 105,000 shaft horsewer of the proposed American Export Isbrandtsen Lines 30-knot ntainer ships.

E. POTENTIAL FOR NUCLEAR POWER IN THE MARITIME FIELD

Nuclear power compares most favorably to fossil fuel power in appliions requiring high shaft-horsepower in trades where there can be h percentage utilization of the powerplant potential.

FAST TURNAROUND CONTAINER OR BARGE SHIPS

These ships most nearly satisfy the condition which favors nuclear wer because of its high speed and fast turnaround. The estimated nomic results of using nuclear power in this application are shown chapter II.

ARGE TANKERS AND DRY BULK CARRIER APPLICATIONS OF NUCLEAR POWER

Large tankers and dry bulk carriers deliver low-value-per-ton comdities on an assembly line or pipeline basis. There is no substantial mium on speed of delivery since there is a very low interest cost on se commodities in transit. Powerplants for bulk carriers will theree be built to give the most economical overall delivery cost. Larger, re costly powerplants will only be installed up to the point where revenue from the added transportation capability made possible higher speed is greater than the combined added costs of machinery ortization and fuel.

Nuclear power is most competitive in the range of high shaft horsewer output propulsion systems; that is, in excess of 50,000 shaft sepower. The increase in the size of bulk carriers (soon to be 300,000 dweight tons for tankers) is requiring larger and larger powernts. The projected 300,000 deadweight tons tankers will require an mated 60,000 to 70,000 shaft horsepower plant operating twin screws ttain the projected 16-knot speed. Dry bulk carriers are not likely to ome as large as tankers because of loading and unloading and other rictions and therefore will not require high shaft horsepower plants he foreseeable future.

here are two serious limitations on the use of nuclear powerplants tankers even after plants of 50,000 to 100,000 shaft horsepower are uired: (1) the ballast legs of tankers require less than full power therefore make poor use of the fixed charge component of nuclear 1; (2) there is very little penalty for the fuel storage space and for companies some credit for using their own products at an intrapany price. Both these factors make it doubtful that nuclear power The competitive in bulk ships with present nuclear technology.

POSSIBLE FUTURE APPLICATIONS

Experience indicates that radical new ship forms and systems will elop for many special purposes in the next 10 to 20 years. Rapidly