Freight News, Sea

Shippers want clearer data on fuel

[ October 23, 2014   //   ]

The Global Shippers’ Forum (GSF) is calling for more information on the impact of maritime Emission Control Areas from 1 January 2015.
With new requirements lowering the maximum allowed content of sulphur in the Baltic, North Sea, English Channel and within 200 miles of North America, only a
few shipping lines have yet provided information to their customers on their low sulphur fuel strategies and the extra cost to be passed on to shippers via increased rates or bunker surcharges, says GSF secretary general Chris Welsh. “With shippers under pressure to finalise freight budgets for 2015 this information is urgently required by customers,” he said.
The GSF recognises the challenges to the shipping industry including marine gas oil which meets the 0.15 sulphur content, use of alternative fuels such as LNG and methanol or abatement technology such as scrubbers. However:
“The fact that there are a range of options for managing the new low sulphur limits means that the impact on costs will be very different from one shipping line to another. For example, fuel costs for new-built vessels capable of using alternative fuels will be substantially different to a carrier using abatement equipment or higher grade marine gas oil.”
GSF has stated that as the low sulphur requirements are limited to specific geographical areas, and as there are various options for managing the new sulphur requirements, shippers will require greater transparency from carriers in order to substantiate extra freight charges and bunker surcharges levied by shipping lines to recover additional costs.
The GSF has developed a series of questions for shippers to use in their negotiations with carriers.

Welsh concluded: “It is extremely important that individual carriers are open and transparent with their customers about the additional costs incurred resulting from the new sulphur limits, and they fully justify the additional freight charges and surcharges being levied. Broad industry surcharge guidelines set by some carrier groups are wholly inappropriate to recover additional low sulphur fuel costs because of the significant differences in energy efficiency of vessels, management of fuel and the different options available to carriers in implementing the new low sulphur limits.  It’s clear, however, that information on additional costs is needed now rather later as shippers set their freight budgets for 2015.”