Why large TSHDs are cheaper than small ones

TSHD size comparison, Part 1.

This is Part one of a two-part series about the extreme difference in size between TSHDs. Even today new TSHDs of 2,000m3 hopper capacity or less are still being build. While on the other end of the spectrum we have TSHDs with a hopper capacity of 46,000 m3, a factor 23 larger! How is that the TSHDs on each end of the spectrum can still operate profitably?

Today we look at the large TSHDS. Why are they being build?

Large TSHDs are cheaper

Large TSHDs can produce cheaper than small TSHDs. Larger TSHD cost more to operate per week, but their higher weekly cost is countered by a much higher production. This reduces the unit rate, the cost per cubic meter, drastically. On a project where a large and small TSHD compete the small one will have no chance. In the next paragraphs we will cover some reasons as to why this is.

The largest TSHD with 46,000 m3 hopper capacity.
Source: www.shipspotting.com

Lower construction cost

Generally speaking the larger the ship, the lower the construction cost per cubic meter of hopper capacity. The construction costs determine a significant portion of the operational costs through depreciation and interest. On the other hand, a larger hopper capacity increases the production. The nett result is a lower unit rate.

Larger projects

Over time the dredging projects became larger and larger. This called for higher weekly productions, to be able to finish these projects in a reasonable time frame. Of course, a lot of small vessels could have been build, but taking the lower construction costs in account the industry moved to larger TSHDs.

Longer sailing distances

Not only did projects became larger, also the sailing distances became longer, specifically for large reclamation projects. Since the large TSHDS can carry so much load they have an added benefit on longer sailing distances.

Less crew

Although the largest TSHD carries 23 times as much as the smallest one it doesn’t have 23 times the crew. So on a per m3 hopper capacity comparison the amount of crew reduces. This reduces the operational costs.

Increased fuel efficiency

Larger TSHDs transport their cargo with less fuel per cubic meter than small vessels. This increased fuel efficiency means the fuel cost per cubic meter dredged is lower, adding to the competitiveness of the large TSHD.

These are not the only reasons why vessels are becoming bigger and bigger. If you know of any more reasons, let us know in the below comment box.

 

When there are is such a clear advantage of larger TSHDs it doesn’t seem to make any sense to still build small ones, but that is exactly what is still happening. In Part 2, we will look into the reasons why the small TSHDs are still being build.

To your long term great results,
Timon Vinke

Leave a Reply

Your email address will not be published. Required fields are marked *