Two technologies gave us globalization, and the shipping container is one of them.
People seem to prepare to be facinated when I begin telling them about my Silk Road project. I have a good book publisher, I have been publishing many articles about it in big media — pretty impressive, right? Then I start talking about shipping containers and, well, that’s the end of that.
The shipping container could be called the camel of the New Silk Road. It’s what makes this entire network of multimodal trade routes between China and Europe possible. It’s what allowed globalization to happen in the first place, making transportation vastly more efficient and drastically cheaper, making it economically viable to manufacture products in places like China and shipping them to markets in Europe and the USA. The Economist once called the shipping container more important to globalization than all the trade pacts by all the governments combined.
Without the shipping container our world would look very, very different. The gulf between developed and under-developed countries more than likely would have continued growing, and we’d now be looking at a few rich countries floating upon a sea that’s economically and infrastructurally “off the grid.”
Globalization same-paged the world, and it was two technologies, the shipping container and the internet, which allowed this to happen.
It is easy to look at a shipping container — a steel box that’s of a standardized size and has standardized corners that it can be picked up by — and think that they’ve always been around, that’s it’s something so mundane and basic that we certainly always must have been using them. But it’s not true. The shipping container is a relatively recent invention.
In fact, the shipping container didn’t appear until the 1950s and wasn’t widely implemented until the late 1960s. The story goes that a man who ran a trucking company named Malcom McLean got so angry over the amount of time that his trucks would have to spend waiting for cargo to be loaded in seaports that he vowed to change how shipping itself was done.
After the Second World War there was a global explosion in shipping, and the ports of the world simply couldn’t keep up with the volumes anymore, and ships and trucks were finding themselves waiting in long lines, stuck in ports sometimes for days. The method of loading and unloading ships in those days were similar how it had been done for thousands of years: miscellaneous cargo of all sizes and shapes would be packed in and unloaded by longshoremen. A system that proved no longer efficient enough for the rapidly modernizing economies of the US and Europe.
McClean then came up with the miltimodal shipping container: a steel box that could be loaded with cargo and shipped by sea, rain, and truck — oftentimes being passed between all three during the course of a single journey. This meant that McClean’s trucks could pull into a port and have cargo loaded almost directly onto their trucks straight from the ships without any packing or unpacking. It was a one size fits all approach and the entire planet essentially had to buy into.
This is really what’s really incredible about this story: without standardization the multimodal shipping container is just another steel box. What makes this invention significant is that shipping, trucking, and rail companies, along with the ports of the world, all needed to upgrade the types of equipment they used and completely reconfigure how they did things.
It was a revolution that has impacted all phases of our lives, a revolution that allowed for a global division of labor, a revolution that has allowed countries to transition from backwaters to global economic hubs, a revolution that made China a superpower, a revolution which sparked hundreds of millions of new middle class individuals, a revolution that made it possible for use to have fresh vegetables year round, a revolution that made that bottle of New Zealand, French, or Portuguese wine that you may be drinking so cheap — a revolution that lead to my father being laid off from his job and my city being sent into a downward economic spiral.
Along with the internet, the shipping container is for sure the greatest invention of the past century.
An example of how cheap shipping now is was pointed out by Bart Kuipers, a professor at Erasmus University in Rotterdam and an advisor to the port there:
One shipping container can hold 18,000 bottles of wine. Right now, the cost of ocean shipping is lower than it’s ever been, and the price to ship a container around the world is hovering around $800. That means it costs roughly four and a half cents to ship each bottle, which is hardly half a percent of the value of even cheap wine.
“The emergence of a new stable prosperous middle class of many hundreds of millions of world citizens is one of the economic miracles of the past century, and has largely been made possible because of the container,” Kuipers said.
The shipping container changed everything.