Commentary: A reality check is needed on Arctic shipping

NICHE COMMERCIAL ACTIVITY

Still the cold, hard fact remains that Arctic shipping is nothing more than a niche commercial activity. There is a long way, and time, to go until it becomes a viable business proposition of scale. Nonetheless, moves like Sea Legend’s are hugely interesting geopolitically.

“The commercial aspect is not there yet. For the majority of (trade) volumes, this is really far away,” Vincent Clerc, the chief executive of Danish shipping giant Maersk, told me late last year, suggesting a timeframe of decades.

The Northern Sea Route has not lived up to Russia’s expectations, not least as sanctions following the full-scale invasion of Ukraine have curbed foreign ships. That has left it mostly used for transporting Russia’s own petroleum and mineral resources from its frozen north.

But there is clear potential for China, especially as it looks for alternatives to popular trade routes that could have chokepoints controlled by the US or its allies. That is an acute concern for Beijing, something that has led it to look at building a potential Ice Silk Road.

The Northern Sea Route is not exactly problem-free here either, though. Given the entire route is under Russian control, it merely substitutes one chokepoint for another. Worse, the entrance to it is via the Bering Strait, on one side of which sits the US.