Ancient Roman lessons on shipping and logistics

The Ancient Romans were fiercely proud of the network of roads they built across their empire, all of which, as we know, led to Rome. Many of them, from Britain's Fosse Way, to Greece's Via Egnatia and Italy's Appian Way, are now covered, or paralleled, by modern incarnations.

Others, in countries as far apart from each other as Algeria, Syria and Germany, carry on clinging to the surface of the earth.

A fair amount of them are still paved, while others have turned into mere dirt tracks, but all are testament to Ancient Rome's might and ingenuity.

Then there were the maritime routes that served Rome.

Even more vital to the empire's wealth and survival was its control of the Mediterranean Sea, or as the Romans called it, Mare Nostrum - "Our Sea".

Imperial Rome was the first, and only, power to have ever controlled the shores of the entire Mediterranean. With its maritime routes fully under its control - and the issue of piracy, more often than not, kept successfully at bay - Rome was able to import vast amounts of grain from North Africa, porphyry from the Red Sea, tin from Britain, wine from the Greek island of Samos and olive oil from Spain.

Reflecting Rome's huge appetite for all sorts of commodities is Monte Testaccio in Rome, a massive, artificial mound that is, essentially, a waste dump, composed entirely of discarded fragments of broken amphorae that once contained olive oil.

So it was rather apt that a conference on solid fuels - thermal coal and petroleum coke, that is - which I attended earlier this month, led me to Rome.

The event's main topic of discussion was whether the appetite of major Mediterranean countries, such as Egypt and Turkey, for these commodities will be able to support trade at what are at the moment challenging times for the construction and power industries, as well as dry bulk shipping.

Both Egypt and Turkey have booming populations, entailing a great deal of construction and a lot of electricity demand.

In Turkey's case, in recent years it has been a major importer of petcoke and scrap metal, which it needs for the production of cement and reinforcing bars.

But during a coffee break at the event, a Turkish cement producer told me there were fears that much of the construction that takes place in Turkey is for show - that behind it lies a desire to present a front of stability best reflected by constant building projects.

"The population is booming, there are many young people who need good homes, but they can't afford many of those apartments being built," he told me. "We're afraid that the housing bubble may burst, like in Ireland, at some point, which will really affect the cement industry."

Also, the Turkish cement producer told me, many of the buildings currently being built in Turkey are of substandard quality. One only has to look back to the 1999 Turkey earthquake to understand this: countless apartment blocks collapsed, leaving hundreds of thousands of people homeless. Bad construction was blamed for this but, I'm told, lessons were not learned.

Extensive building projects, often done in a rush, in order to present a front of prosperity, are not a new thing. Let's take another Roman example, from when Emperor Constantine moved his capital from Rome to Byzantium. At first known as New Rome, it was later called Constantinople, and even later it became what we know as Istanbul, Turkey's largest city.

Built in just six years leading up to AD 330, much of Constantinople was constructed in great - and very un-Roman - haste. Not long after the city's consecration, many of its buildings began to fall apart and had to be rebuilt from scratch.

Roman ingenuity was going slack.

As far as Egypt is concerned, what was back in Roman times the Mediterranean's chief exporter of grains, is now a major importer of wheat, corn and cereals.

Also, its rapidly increasing population is leading to an ever increasing appetite for petcoke and scrap metal, an Egyptian attendee of the Rome conference told me.

"Egypt wants to be self-sufficient," he told me. "It wants to make its own cement and reinforcing bar, but it is running before it can walk. It is not ready to import huge amounts of petcoke and scrap metal, logistically, or in any other way."

And here comes again the importance of roads and ports, which the Romans knew only too well.

The reason why Egypt is not ready for an increasing amount of petcoke and scrap metal imports is because it lacks the storage infrastructure to handle them, and its road network leaves a lot to be desired. Also, its cement production plants and steel mills, mostly located in the country's south, are way too far from Egypt's major ports, while the trucks used to transport all this material tend to be antiquated.

Sadly, the Egyptian gentleman told me, Egypt's tourist industry has suffered a heavy blow as a result of political instability and the threat of terrorism, resulting in a lack of hard currency that would otherwise have helped the country invest in its infrastructure and logistical links.

Ancient Rome began to suffer when its links to its empire began to be severed. It is no coincidence that the Vandal capture of Africa Proconsularis - a province comprised of what are today parts of Tunisia, Libya and Algeria - in AD 429-439, which led to Rome being cut off from a major source of grain, triggered a sharp decline in the city's population: it fell from half a million people in AD 450, to a mere 100,000 in AD 500.

Rome's "Mare" was no longer "Nostrum" and most Romans fled the city.

So when it comes to learning lessons from the past about the importance of strong shipping links and even stronger logistics - because a ship's supply chain does not end with discharge at a port - there is no doubt: all roads still lead to Rome.

Source: Platts