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doi 10.1287/trsc.1030.0036
2004 INFORMS
Kjetil Fagerholt
Department of Marine Technology, Norwegian University of Science and Technology, Trondheim, Norway, kjetil.fagerholt@pipelife.no
David Ronen
College of Business Administration, University of MissouriSt. Louis, St. Louis, Missouri, david.ronen@umsl.edu
he objective of this paper is to review the current status of ship routing and scheduling. We focus on
literature published during the last decade. Because routing and scheduling problems are closely related to
many other eet planning problems, we have divided this review into several parts. We start at the strategic
eet planning level and discuss the design of eets and sea transport systems. We continue with the tactical
and operational eet planning level and consider problems that comprise various ship routing and scheduling
aspects. Here, we separately discuss the different modes of operations: industrial, tramp, and liner shipping.
Finally, we take a glimpse at naval applications and other related problems that do not naturally fall into these
categories. The paper also presents some perspectives regarding future developments and use of optimizationbased decision-support systems for ship routing and scheduling. Several of the trends indicate both accelerating
needs for and benets from such systems and, hopefully, this paper will stimulate further research in this area.
Key words : maritime transportation; ship scheduling; eet size and mix
History : Received: July 2002; revision received: December 2002; accepted: January 2003.
2
3.5
3.5
3.0
3.0
2.5
2.5
2.0
2.0
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1.5
1.0
1.0
0.5
0.5
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9495 9596
9697
9798
9899
9900
Number
Dwt.
0
0001 '01.01 07.01
Figure 1
World Fleet Development 19942001 for Vessels of More Than 300 Gross Tons
Source. ISL (2001).
strategic to the tactical and operational levels. Typical examples are: optimal size and mix of the eet,
routing and scheduling for each ship in the eet, and
selecting the best course for a ship between two ports
subject to prevailing weather and ocean currents.
A ship involves a major capital investment (usually
millions of U.S. dollars), and the daily operating
costs of a ship can be tens of thousands of dollars. This means that improving eet utilization can
be translated into signicant improvements in nancial results. Another positive result of increasing eet
utilization can be reduced damage to the environment
because of reductions in transport operations.
It is clear from the above that there is a considerable need for, and potential benets from, decisionsupport systems in ship scheduling. The rst survey
in ship routing and scheduling dates back to 1983
(Ronen 1983). Ten years later, Ronen (1993) published
a second review on ship scheduling and related areas
for the decade 19821992. The increasing interest in
maritime transportation is reected in some recent
publications. Transportation Science recently devoted
an issue to maritime transport (Psaraftis 1999). In
a recently published book, Perakis (2002) gives an
overview of models for a few selected problems
in eet operations and deployment. Chajakis (2000)
presents six small typical case studies in marine
petroleum logistics, where the use of management
science produced benets for the marine transporter,
the shipper, or both. In addition, special aspects of
maritime operations are presented in the operations
research (OR) literature. Vis and de Koster (2003) give
a review on transshipment of containers in container
terminals where more than 50 papers are referenced.
In general, the literature has shown a positive and
signicant increase in the number of papers on ship
scheduling since the last survey in 1993, and there is
now a need to survey the more recently published
Table 1
Operational Characteristic
Fleet variety
(physical and economic)
Power unit is an
integral part of the
transportation unit
Transportation unit size
Operating around
the clock
Trip (or voyage) length
Operational uncertainty
Right of way
Pays port fees
Route tolls
Destination change
while underway
Port period spans
multiple operational
time windows
Vessel-port compatibility
depends on load
weight
Multiple products
shipped together
Returns to origin
Ship
Aircraft
Truck
Train
Large
Small
Small
Small
Yes
Yes
Often
No
Fixed
Fixed
Variable
Usually
Seldom
Usually
xed
Seldom
Usually
Days or
Hours or
Hours or
Days
weeks
Larger
Shared
Yes
Possible
Possible
days
Larger
Shared
Yes
None
No
days
Smaller
Shared
No
Possible
No
Smaller
Dedicated
No
Possible
No
Yes
No
No
Yes
Yes
Seldom
No
No
Yes
No
Yes
Yes
No
No
Yes
No
Table 2
Paper
Major Decision
Fleet size
Design of transport system
Fleet size and mix
Fleet size and mix
Design of transport system
Container eet size
Fleet mix and system design
Fleet size and logistics system design
Resource management
Fleet size
Fleet size and eet deployment
Objective
Cargo
Maximum prot
Maximum prot
Maximum probability of
winning campaign
Minimum number of tankers
Evaluate solutions
Minimum costs
Minimum costs
Evaluate solutions
Minimum costs
Minimum costs
Minimum costs
Maximum prot
Evaluate solutions
Minimum costs
Containers
Containers
MIP
SP
MIP + expert opinion
Crude oil
Passengers
Containers
General cargo
Fresh water
Containers
Sludge
Dry bulk
Containers
Solid waste
Any
LP
Simulation
IP + DP
IP + DP
Simulation
Simulation
Descriptive + heuristics
MIP
Heuristics
Simulation + heuristics
LP + DP
Method
subject to
cvr xvr
a
ivr xvr
vV r Rv
(1)
=1
xvr = 1
v V
xvr 0 1
v V
r Rv
i N
(2)
(3)
r Rv
(4)
The objective function (1) minimizes the costs. Constraints (2) ensure that all cargoes are serviced. In
some cases, we cannot guarantee that the eet manages to service all cargoes during the planning period.
In such a case, some of the cargoes can be serviced by
spot charters. We introduce a variable si that is equal
to one if cargo i is serviced by a spot charter and zero
otherwise, and an associated spot cost cSP OT i .
When we take the spot shipments into account, (1)
and (2) become
min
vV r Rv
vV r Rv
cvr xvr +
cSP OT i si
(1)
iN
aivr xvr + si = 1
si 0 1
i N
i N
(2)
(5)
Scheduling transportation of oil is a classical problem in commercial cargo shipping, and is studied by
Brown et al. (1987). We start with this work because
several papers extend it in one or more ways. A major
oil company is shipping crude oil from the Middle
East to Europe and North America. All cargoes are
full shiploads, and are specied by ports and dates
for loading and discharging. The cargoes can be taken
either by a ship in the controlled eet or by spot
charters. The problem is formulated as a SP model.
The problem is slightly modied compared to problem (1)(4) by allowing some constraints to be violated at a cost, resulting in an elastic SP model. The
solution method exploits the problem knowledge in
an elastic enumeration procedure. The problem can be
solved by generating all feasible schedules, because
it is relatively well constrained. The same problem is
studied by Perakis and Bremer (1992), and the results
of the study are presented in Bremer and Perakis
(1992). Also here a SP model is applied. The number
of feasible schedules indicates that their problem was
also well constrained.
The work of Brown et al. (1987) is extended in
Bausch et al. (1998) where each load consists of up to
ve products. They present a decision-support system
for medium-term scheduling (two to three weeks) for
a eet of coastal tankers and barges transporting liquid bulk products among plants, distribution centers,
and industrial customers. The ships may have up to
seven xed compartments, thus, allowing a cargo consisting of several products to be freighted by the same
ship. In addition to the specied set of loads that must
be shipped, there may be some optional back hauls
available. These back hauls generate income and may
be taken if they are protable. This issue introduces
a tramp operation aspect into this industrial shipping
problem. The same SP approach as in Brown et al.
(1987) is used. However, the user interface is different. Here, a simple Excel spreadsheet interface cloaks
the decision-support system and makes this system
useable via a variety of natural languages. All dispatchers communicate via the spreadsheet independent of language, and view recommended schedules
displayed in Gantt charts.
A problem similar to Bausch et al. (1998) is studied by Sherali et al. (1999). Crude oil and a number
of rened oil-related products are to be shipped from
ports in Kuwait to customers around the world. In the
problem description, the authors put some focus on
the classes of vessels considered, the company controlled vessels and the spot-chartered vessels. In addition, several routes between certain port pairs may
exist, either through the Suez Canal or around the
Cape of Good Hope. In such a case, there is a tradeoff between travel time and canal dues. An aggregate
MIP model retaining the principal features of the real
Table 3
Paper
Bausch et al. (1998)
Bremer and Perakis (1992)
Brown et al. (1987)
Cho and Perakis (2001)
Christiansen and Fagerholt (2002)
Fagerholt (2001)
Fagerholt and Christiansen (2000a, b)
Major Decision
Objective
Scheduling
Minimum costs
Minimum costs
Alternate: minimum costs,
maximum prot,
maximum customer
satisfaction
Minimum costs
Barge scheduling
Barge scheduling
Minimum costs
Minimum costs
Cargo
Method
Minimum costs
Minimum costs
Minimum costs
Minimum costs
Minimum costs
Minimum costs
Minimum costs
SP
SP
SP
IP
SP
SP
SP
Crude oil
Bulk and semibulk
Rened
oil products
SP
IP + heuristics
Lagrangian relaxation and
Benders decomposition
Paper
Chajakis (1997, 2000)
Christiansen (1999)
Christiansen and Nygreen (1998a, b, 2001)
Flatberg et al. (2000)
Fox and Herden (1999)
Kao et al. (1993)
Liu and Sherali (2000)
Mehrez et al. (1995)
Ronen (2002)
Shih (1997)
Major Decision
Objective
Cargo
Method
Minimum costs
Minimum costs
Minimum costs
Minimum costs
Minimum costs
Minimum costs
Minimum costs
Minimum costs
Minimum costs
Minimum costs
Bulk oil
Bulk ammonia
Bulk ammonia
Bulk ammonia
Ammonia products
Coal
Coal
Dry bulk minerals
Liquid bulk oil products
Coal
subject to
vV r Rv
vV r Rv
xvr = 1
v V
xvr 0 1
v V
r Rv
i si
(6)
iNC
si 0 1
i NC
i NO
(7)
(8)
(9)
r Rv
i NC
(10)
(11)
Paper
Appelgren (1969, 1971)
Bausch et al. (1998)
Christiansen (1999)
Fagerholt (2003)
Kim and Lee (1997)
Sherali et al. (1999)
Major Decision
Objective
Cargo
Method
Scheduling
Scheduling and speed
Inventory scheduling
Scheduling
Scheduling
Scheduling
Maximum prot
Minimum costs
Minimum costs
Maximum prot
Maximum prot
Minimum costs
Refrigerated cargo
Liquid bulk oil products
Bulk ammonia
Any
Bulk
Crude oil and rened oil products
DW decomposition
SP
DW decomposition
Heuristics
SP
MIP and heuristics
Paper
Jaramillo and
Perakis (1991)
Perakis and
Jaramillo (1991)
Powell and
Perakis (1997)
Major
Decision
Objective
Cargo
Method
General LP + heuristics
General LP + heuristics
General IP
Table 7
Paper
Brown et al. (1996)
Darby-Dowman et al. (1995)
Nulty and Ratliff (1991)
Psaraftis (1988)
Thompson and Psaraftis (1993)
Major Decision
Objective
Minimum costs
Meet goals
Meet goals
Meet goals
Meet goals
Cargo
Any
Any
Method
Elastic MIP
SP
Interactive and IP
Heuristics
Heuristics
Table 8
Paper
Azaron and Kianfar (2003)
Brown et al. (1997)
Brown et al. (1994)
Fagerholt et al. (2000)
Gavirneni et al. (2001)
Iakovou et al. (1999)
Kao and Lee (1996)
Lai et al. (1995)
Lo and McCord (1998)
Lo et al. (1991)
McCord et al. (1999)
Paolucci et al. (2002)
Shen and Khoong (1995)
Vis and de Koster (2003)
Wermus and Pope (1994)
Major Decision
Objective
Cargo
Method
Environmental routing
Submarine berthing
Berth scheduling
Routing
Streamer deployment
Routing
Arrival scheduling
Empty container allocation
Environmental routing
Environmental routing
Environmental routing
Load allocation
Empty container allocation
Overview paper
Pilot scheduling
Minimum time
Minimum number of berth shifts
Minimum number of berth shifts
Minimum distance
Minimum time
Minimum costs and risk
Minimum demurrage costs
Minimum costs
Minimum costs
Minimum costs
Minimum costs
Minimum time
Minimum costs
Hazmat
Containers
Crude oil
Containers
DP
IP
IP
DP
Simulation
Network model
IP
Heuristic
DP
Calculus
DP
Simulation
Network model + heuristic
Heuristic
also the eet of ships. The purpose of an industrial operation is usually to provide the required
transportation services for the organizations cargo
requests at minimum cost. Industrial shipping is practiced by vertically integrated companies, and that is
probably the explanation why many of the earlier
studies fall into this category. Many large production
companies often had their own division controlling a
number of ships for the transportation of their own
cargoes. However, in recent years, this has changed.
Many such companies are now focusing on their core
business and have outsourced other activities like
transportation to independent shipping companies.
Therefore, the emphasis has shifted somewhat from
industrial to tramp shipping. Increasing global competition results in shifting industrial shipping operations from being considered cost centers into prot
centers and compels them to become more involved
in the spot market. On top of that, marine accidents
that resulted in large liabilities cause shippers to outsource the shipping of their cargoes.
If we consider this from the shipping companies perspective, a tramp shipping company will, in
contrast to an industrial shipping company, serve a
number of different shippers. Unlike an industrial
operation, some cargo requests (spot cargoes) can be
rejected if the ships can be used for better paying cargoes. While the objective in industrial shipping is to
minimize costs while servicing all cargo requests, the
objective in tramp shipping is usually to maximize
prot per time unit. While industrial shipping is, to
a high extent, a closed system consisting of a given
number of ships and cargoes, there is much more
interaction with the market in tramp shipping.
Shifting from industrial to tramp shipping brings
new opportunities for optimization-based decisionsupport systems for ship scheduling. When minimizing costs in ship scheduling, there are most often
only the variable costs (mainly fuel and port costs)
that are considered, because the xed costs (typically capital and crew costs) will not be inuenced
by scheduling decisions. By optimizing eet scheduling, a tramp shipping company can improve eet
utilization in a manner that several additional spot
cargoes can be carried. This may signicantly increase
total income, while the variable costs often moderately increase. Therefore, while an industrial shipping company often will have limited possibilities
for improving operations (i.e., the number of cargoes to be carried is xed), a company engaged in
tramp shipping will often have much more exibility and solution space. This means that optimization
in eet scheduling will probably have greater nancial impact for tramp shipping than for industrial
shipping, indicating even more incentives for research
within this area in the future.
Industrial
- Minimization of costs
- Closed system
- No integration along the chain
Figure 2
we see an increase in the number of references compared with the previous decade. We believe that in
the future, even more shipping companies will play
the role of vendors in such logistics systems.
Not all customers or shippers currently using a formal ordering system will be willing or able to change
to a VMI system. Such a system requires remote monitoring of inventories to forecast use and determine
delivery times and quantities. Even though the technology for such monitoring exists at an affordable
price today, the nature of business is such that a customer may be unwilling to transfer this information
completely to a vendor. This can be motivated by a
variety of reasons beyond a simple lack of trust. However, even in those situations where an ordering system cannot be eliminated, the eet scheduling costs
and, hence, the supply chain costs can be signicantly
improved. This can be achieved if the shipper and
the shipping company are able to share at least some
information in a manner that unnecessarily tight time
windows and lack of exibility are avoided as discussed earlier. This has now become possible (at least
technologically) via the Internet.
During the last few years, some research has been
done to investigate how ocean shipping can be
integrated into a multimodal door-to-door supply
chain. As an example, we can refer to Saldanha and
Gray (2002), where the potential for British coastal
shipping in a multimodal chain is analyzed. A study
is undertaken to investigate the standpoint of leading
managers in such companies toward multimodal integration. The results of the study indicate that the managers are positive toward multimodal developments.
Figure 2 gives a simplied summary of important
ship scheduling features yesterday, today, and
tomor- row, though it should be emphasized that
this does not include liner shipping. From a focus
on indus- trial shipping, we have moved toward
tramp shipping with much more emphasis on
interaction with the market for the shipping
company. Even so, sea trans- port is still rarely
integrated along the supply chain, even though we
can notice an increasing number of references
indicating a progression in that direction
(see 1.2.3).
In the future, we believe that the focus on considering ship routing and scheduling in a supply
Today
Tramp
- Maximization of profits
- Interaction with market
- No integration along the chain
Tomorrow
Tramp
- Maximization of profits
- Interaction with market
- Integration along the chain
3. Summary
Ship routing and scheduling is an interesting area
with high potential for improvement by optimizing
eet utilization. The research described in the literature within maritime routing and scheduling has
lagged far behind what has been achieved in land and
air transport. Despite this, we have seen a trend indicating increased interest and focus on the topic since
the last review on ship routing and scheduling (Ronen
1993). The review presented here has almost 60 references on the subject published during the last decade,
whereas Ronens review included only about 30 references for the former decade. In addition, Vis and
de Koster (2003) present approximately 50 references
(most of which are from the last decade) on container
terminal operations. Although most of the work discussed here stemmed from real-life problems, only a
fraction of it has matured into real decision-support
systems that are used in practice. However, we are
aware of several ship scheduling systems that are
in regular use but are deemed condential by their
owners.
The rst part of this paper consists of a thorough literature review, summarizing and discussing research
on ship routing and scheduling with an emphasis on
publications during the last decade. We have divided
the reviewed papers into the following four categories (though some papers may straddle several of
them):
Strategic ship planning issues such as design of
optimal eets and maritime supply chains;
Tactical/operational ship scheduling within
industrial shipping and tramp shipping, e.g., optimal
assignment of cargoes to ships and, hence, ship
schedules;
Liner shipping, such as network design and eet
deployment; and
Other shipping issues related to routing and
scheduling.
We notice that there has been little research on liner
shipping and strategic shipping (e.g., eet size) problems during the last decade. This may be surprising,
especially when we consider the increase in container
trafc and the large number of mergers in the container shipping industry. Container shipping companies operate mostly in the liner segment, and mergers
should make the problems of network (re)design and
eet deployment more pressing. This is not reected
in the literature. However, we see an increasing number of references on operations of container terminals
(Vis and de Koster 2003). Such terminals require large
tracts of land close to the water, and a large capital
investment in infrastructure and equipment. The analysis of operations of container terminals is used to
justify such investments. The large number of new
and expanded container terminals may be the source
of this urry of research.
We can also see from the literature review, that
there has been an increased focus on supply chains
during the last decade, both with respect to design
of mar- itime supply chains (see 1.1) and to their
operation (see 1.2.3).
In the second part of this paper, we have discussed
some trends in the shipping industry indicating an
even stronger need for research, as well as pointing
to some new research directions within this area. The
trends discussed can be summarized as
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