World Maritime News (59)

Topics on the container shipping market

Expectations of a “stabilization” of container shipping have been overplayed, and the market is now as good as it gets, according to Vespucci Maritime chief executive Lars Jensen. “This market was never stable, and it was never normal,” he told an audience at the TOC Conference in Rotterdam. “If you look at spot rate variations in the decade before the pandemic, it was not uncommon for them to change by a factor of three. We also regularly have port strikes on the US west coast. All the things we are grappling with that we see as issues in the market right now are issues but a normal part of the market.” He warned that the most important thing to do in the market right now was not to wait to stabilize.

Transpacific spot freight rates took another tumble this week, with figures from the Shanghai Containerised Freight Index showing a 13% fall on the Asia-US west coast and Asia-US east coast trade lanes. Neither the now-settled west coast labor dispute nor the draught restrictions on the Panama Canal stopped rates from falling again, largely due to the available capacity.

While blank sailings have prevailed in Asia to Northern Europe liner trades, there have been almost none on routes from the Far East to the Mediterranean. Container shippers on the Asia-Mediterranean trades are said to be paying up to $1,150 more for spot rates for a 40-foot box than exporters moving their cargo from Asia to North Europe services.


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HHLA and Cosco finalize stake buy in Hamburg terminal

Cosco Shipping Ports (CSP) said it had signed a revised agreement to acquire a minority stake in a container terminal at Germany’s Hamburg port, ending years-long debate over the deal’s national security risks. The agreement with Hamburger Hafen und Logistik allows the Hong Kong-listed subsidiary of state conglomerate China Cosco Shipping Corp to buy a 24.99% stake in HHLA’s Container Terminal Tollerort for €46.4m ($50.7m), according to a stock exchange filing. CSP said the revision also prohibits it from having veto rights about the terminal’s strategic business decisions, including a budget, business plans, and personnel decisions.


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ILWU and PMA announce long-awaited tentative agreement on new west coast labor contract

Dockworkers and their employers on the US west coast have reached a tentative six-year labor contract, more than a year after the sides began negotiating and almost a year after the previous contract expired. The parties agreed not to release details of the agreement, which would need to be ratified by the 22,000 dockworkers represented by the ILWU and PMA members.


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Port cooperation can reduce infrastructure investment

Port authorities should look at regional cooperation rather than outright competition to balance shipping needs against infrastructure investments more effectively, according to Hercules Haralambides, professor of maritime economics and logistics at Erasmus University in Rotterdam. “I used to think that competition was important and that a port could only do well if it was in a position to compete,” he said. “But they should not compete on infrastructure and not duplicate infrastructure to attract businesses from their neighbors, particularly in the European Union.” Instead, ports should coordinate on infrastructure, then have the private sector come in and compete in the operation by offering operating licenses in a way that promotes competition between them. The port of Antwerp-Bruges, which involved two competing ports coming together under one authority, was an example of how this could work.


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Delaying IMO action will increase decarbonization costs and fragmented risk regulation, UN warns

The UN Conference on Trade and Development (UNCTAD) has published its expert review on proposed measures to tackle shipping’s decarbonization under the auspices of the IMO, outlining proposals including the emissions cap and trade system by Norway and Japan’s zero-emission shipping incentive scheme as well as others. Delaying action by the IMO will generate more costs for shipping’s decarbonization, and it could also lead to the emergence of different tiers of overlapping regional regulations, according to the UNCTAD. UNCTAD’s review will inform discussions at next month’s Marine Environment Protection Committee 80, when the IMO will review its GHG strategy and discuss market-based and technical measures.


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EU needs €13bn if it is to achieve 5% renewable marine fuels by 2030, environment lobby says

The EU had set an aim for up to 2% of renewable hydrogen-derived marine fuels from 2034 as part of the FuelEU Maritime Package. The EU requires the funding of €13bn ($14bn) to kickstart hydrogen-derived bunker fuels by 2030 for them to account for 5% of total marine fuels by that date, according to lobby group Transport & Environment. “We have always pushed uptake of 5% or 6% renewable fuels of non-biological origin to ensure shipping’s energy transition is on a path feasible with the Paris Agreement. The point is to hit a critical mass of uptake so that the sector weans itself off fossil fuels and non-scalable biofuels as soon as possible,” Jacob Armstrong, sustainable shipping officer at T&E, told Lloyd’s List.


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EU to set obligations for fuel suppliers to produce renewable fuels

The Council of the EU has voted to approve the revision of the Renewable Energy Directive that includes a sub-target for advanced biofuels and renewable hydrogen-derived fuels supplied to the transport sector and obligations for fuel suppliers to meet demand. The revision sets a binding 5.5% sub-target for renewable fuels of non-biological origin (RFNBOs) and advanced biofuels supplied to the transport sector. Within the same target, there is a minimum requirement of 1% of RFNBOs in the share of renewable energies supplied to the transport sector in 2030. The EU has agreed to increase the share of renewable energy in the EU’s overall consumption to 42.5% by 2030 from 32% previously to achieve 45%.


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Speed reduction, wind propulsion and green fuels could halve shipping emissions by 2030

Shipping emissions could fall by 28%-47% by 2030 due to a 5%-10% uptake of zero-emission fuels, speed reduction of 20% or 30%, and wind propulsion measures with the highest efficiency, according to a new study by consultancy CE Delft. The report said about half the emission reductions result from lower speeds and other operational measures, wind-assisted propulsion, and zero and near-zero greenhouse gas fuels each account for a quarter. The study, commissioned by environmental groups Transport & Environment, Seas at Risk, Ocean Conservancy, and Pacific Environment, calls for member states to agree on halving shipping emissions by 2030 at the IMO’s critical meeting next week. Environmental groups’ 50% emissions reduction target for 2030 is much more ambitious than most progressive targets by IMO member states. The US, the UK, and Canada called for a 37% target by 2030, while EU countries target 29% by the same date.


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Topics on shipping lines’ decarbonization

Mediterranean Shipping Co. (MSC), the world’s largest containership operator, plans to order new series of methanol-fuel boxships with a capacity of 8,000 teu. Meanwhile, Taiwan’s Evergreen is close to finalizing multiple deals for a series of dual-fuel methanol, neo-panamax containerships with a capacity of 16,000 teu.

MAN PrimeServ, the after-sales division of MAN Energy Solutions, is set to retrofit a series of 15,000 teu boxships delivered to Maersk between 2017 and 2019. It has confirmed that it will retrofit 11 existing containerships to methanol propulsion for Maersk from 2024. The neo-panamax dimensioned vessels which can load 15,226 teu, are presently deployed in the Asia-Mediterranean trades.


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Maersk’s bio-methanol supplier expects rising demand from shipping

Dutch fuel supplier OCI Global has seen greater demand from the shipping industry for bio and green methanol, and the company was confident in the industry’s ability to pay for expensive alternative fuels, Ahmed el-Hoshy, chief executive of the company, told Lloyd’s List. OCI has agreed to supply bio-methanol to Maersk’s first dual-fuel vessel that will make its first voyage from South Korea’s Ulsan to the Danish port of Copenhagen in September. OCI’s bio-methanol is certified by the International Sustainability and Carbon Certification following the European Union’s Renewable Energy Directive.


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Shippers wary of carbon tax being the ‘mother of all bafs’

Carrier customers fear being charged money for carbon abatement without clear evidence of how it will help. Shippers want to decarbonize but need greater clarity on establishing extra costs. A carbon tax should not just be passed on to customers. The carbon tax could prove to be “the mother of all bafs (Bunker Adjustment Factor)” if imposed without sufficient detailing of how the cash collected would be used, according to Global Shippers’ Forum director James Hookham.


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Shipping’s carbon revenues must be distributed beyond maritime for equitable transition, World Bank says

The World Bank has published a report to propose measures to spend revenues from a potential carbon pricing mechanism for the maritime sector ahead of the International Maritime Organization’s revision of its greenhouse gas strategy at next month’s Marine Environment Protection Committee 80. The bank suggests revenues should be prioritized for developing countries facing disproportionately negative climate change impacts.


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