China has opened a Belt and Road route in the Arctic after land and sea, securing a third path linking Asia and Europe. The Financial Times (FT) reported on the 13th that Chinese shipping company Sea Legend launched the first regular container service through the Arctic. A scheduled Arctic route with weekly departures is the first of its kind in the world.
Sea Legend will dispatch its first Arctic-bound container ship on the 15th from Ningbo-Zhoushan Port in Zhejiang province. Starting with this vessel, a total of eight ships will head to Felixstowe in the United Kingdom, one per week, through Oct. 3.
The Arctic sea route is navigable by merchant ships only from August to October as the ice melts. After October, the sea refreezes and ships cannot enter. Sea Legend has limited its operating period from the 15th to Oct. 3 and has not announced winter operations. Experts predicted that, for the time being, this route will be a seasonal lane that opens in summer and early fall each year and then closes.
Sea Legend conducted a trial run with one container ship last year and decided to deploy a total of seven this year. The company began consolidating cargo from six major eastern Chinese ports, including Dalian and Shanghai, at Ningbo-Zhoushan, and started receiving cargo on the 12th. Logistics experts said that using the new Arctic route, cargo can reach Northern Europe from eastern China in 20 to 22 days. Sending the same cargo via the Suez Canal takes 30 to 40 days, and routing around the Cape of Good Hope in Africa takes up to 50 days.
Chinese exports bound for Europe by sea have had to pass through narrow chokepoints: the Strait of Malacca off the Malay Peninsula, the Bab el-Mandeb near the Red Sea, and Egypt's Suez Canal. Since the start of the Iran war in February this year, Houthi rebels in Yemen have blocked the Red Sea, forcing ships to Europe to choose the ultra-long route around the Cape of Good Hope. When routes lengthen, carriers must pay higher fuel and charter expenses proportional to the added distance. By contrast, the Arctic route skips all three logistics chokepoints at once. Sea Legend said it will use this advantage to prioritize loading products that require speed, such as electric vehicles and batteries, solar equipment, and e-commerce shipments, on the new service.
In its 2018 Arctic policy white paper, the Chinese government defined itself as a "near-Arctic state" and set the development of an Ice Silk Road as a goal. China championed a land-based Silk Road and laid railways and roads through Central Asia to Europe. For the Maritime Silk Road, it acquired a network of ports across the Indian Ocean and the Suez Canal. With the Arctic route now secured as well, China has expanded to three gateways to Europe.
Control of the Arctic route, however, rests with Russia, not China. The Northern Sea Route (NSR) through the Arctic follows Russia's northern coast, passing through Russian territorial waters and its exclusive economic zone. Russia designates this section as under its jurisdiction and requires foreign vessels to file advance notices, obtain transit permits, and use icebreakers. Russia's state nuclear corporation Rosatom handles route operations and permits. The seven Sea Legend vessels assigned to the new service finalized operations only after securing Rosatom's approval. In return, Russia deploys its icebreakers to maintain the route and support smooth navigation. Escort expense and Arctic segment insurance premiums are billed separately and are expected to be reflected in Chinese freight rates.
Russia plans to use this route to ship Russian crude oil and liquefied natural gas (LNG) to China. After losing the European market due to Western sanctions, Russia needed shippers to move resources extracted in the Arctic. China, in return for buying Russian resources, can use the same route to sell its manufactured goods in Europe. It is a division of labor in which Russia provides the route and icebreakers, and China provides the cargo and market.
In the Arctic, shippers cannot set sail immediately just because they have vessels and crews. They must know when and where seas freeze and which waters are shallow to plan routes and schedules. China has built up data on ice, depths, and currents through 16 Arctic scientific expeditions using an icebreaking research vessel. Experts said China is expected to use this data as the basis for deciding which ships its carriers will deploy on the route and when.
Rahul Khanna, global head of Allianz Marine Risk Consulting, told the shipping trade outlet Marine Insight that "shipowners are noticeably increasing transits in the Arctic and along the Northern Sea Route to save time and expense by avoiding geopolitical chokepoints and conflict zones."