Shipping: navigating towards a greener future
Nine out of ten goods traded globally are transported by ship. Without shipping, we would not live in a globalised world. The problem with ships, though, is that they mainly run on fossil fuels and are a massive contributor to global CO2 emissions. The challenge is now on to plot a greener and, ultimately, carbon-free course. Once upon a time, a ship would spend more time in the port being loaded and unloaded than it did at sea. But thanks to the ingenious invention of the standard container in 1954, today’s vessels hold larger quantities of goods in stackable boxes that can be quickly unloaded directly onto trains and trucks at the port.
China’s crude oil imports retreated during 2022
Crude oil imports into China were down 4.6 percent year-on-year during the first 11 months of 2022. In its latest weekly report, shipbroker said that “2022 has turned out to be a very positive year for crude oil trade, despite the surging oil prices and risks of economic recession. In the first 11 months of 2022, global crude oil loadings were up +8.6 percent yo-y at 1,866.8 mln tonnes, excluding all cabotage trade, according to vessels tracking data from Refinitiv. This was well above the 1,718.3 mln tonnes in Jan-Nov 2021, but slightly below the 1,926.9 mln tonnes in the same period of 2019″. According to the shipbroker, “exports from Saudi Arabia are up +17.3 percent y-o-y to 331.1 mln t in JanNov 2022, above pre-Covid levels.
From coal to renewables – lessons to learn from a total transformation
Since the end of 2020, Scorpio Bulkers has been gradually disposing of its dry bulk vessels. In the world of entertainment, this would have been classed an extreme makeover. Why did your company reinvent itself as Eneti? There were several factors that led to this decision: the lower barriers to entry and standards of competition in the dry bulk market and, in 2018 and 2019, the pressure on the transportation of coal, especially from financial institutions in the United States. In parallel, amongst the various research and development projects we habitually appraise, we evaluated the fundamentals of the offshore wind turbine installation vessels and renewables market.
Ship recycling starts 2023 looking for more activity
The ship recycling market has had a challenging 2022, with a general lack of activity. In its latest weekly report, GMS (www.gmsinc.net), the world’s leading cash buyer of ships said that “as we close out another year, sub-continent markets remain suspended at their weakest point for some time now. Pricing remains firm (given the historical price average has been around USD 350/LDT or so), but sentiments and conditions on the ground across all locations remain somewhat precarious. While Bangladesh has been the main proponent of such concern – given the ongoing financial crisis that has resulted in the Bangladeshi government restricting the sanctioning of new Letters of Credit (L/Cs) for even the smallest purchases of USD 1 million and below – this week, the Pakistani government threw its hat in the ring as well, restricting a bevy of L/Cs being sanctioned on recent local purchases.
5 key ocean freight procurement considerations in a falling market
With world inflation widely anticipated to have reached 8.8 percent in the closing weeks of 2022, senior executives within global manufacturers and retailers will be eagerly awaiting ocean transport savings as reports of plummeting containerised freight rates continue to make headline news. With Drewry’s composite World Container Index down a remarkable 75 percent year-on-year, such an expectation is understandable, however, as is so often the case, the devil is in the detail; while rates on Asian export retail-driven routes may have fallen by up to 85 percent, driven by utilisation figures below 80 percent, back haul trade lanes have seen only modest single digit falls with Transatlantic headhaul rates remaining stubbornly above the $7,000USD / 40ft mark. Much as it started, the unwinding of the extreme global freight rate inflation of the pandemic period will be staggered, as easing congestion, cancelled loops and new vessel arrivals see capacity cascade across trade routes.
Maritime and data: seven predictions for the year ahead
As the worst stages of the COVID-19 pandemic receded in 2022, maritime businesses may have expected a return to normality. That smooth ride failed to emerge. The Russian war in Ukraine and unravelling global economies conspired to create another tumultuous year for supply chains and shipping markets. Will 2023 be any better? In some ways perhaps.
Global fleet growth points towards different fortunes for various shipping markets
The global fleet has grown this year, but at various speeds for different ship markets, while the main differentiating factor moving forward is expected to be the rate of renewal, via the orderbook. In its latest weekly report, shipbrokers said that “while Santa Claus has come down the chimney for some, the Chinese authorities have made an early gift to the global economy. China will no longer subject inbound travellers to quarantine from January 8th 2023, putting the country on track to emerge from three years of self-imposed global isolation under a zero COVID policy that battered the economy and stoked historic public discontent.
CII is not the answer – what do we do now?
IMO’s new Carbon Intensity Indicator (CII) regulations (MARPOL Annex VI, Regulation 28) will not help the environment and may in many cases actually lead to higher rather than lower emissions. We have developed and herewith share a detailed presentation on this complex topic. This overview is intended to be both informal and educational. It serves to help our staff and partners understand the likely yet unintended consequences of the regulations and the difficulties with related contractual clauses.