Splash<\/em> today that there were going to be very noticeable disparities between premiums sought by rival liners.<\/p>\nSeveral lines including Maersk, MSC, CMA CGM, Hapag-Lloyd and ONE have made public announcements in the last few months of 2018 advising how they will calculate bunker adjustment factors (BAF) from January 2019 and onwards. Generally these are more granular and objective by design, broken down by tradelane, actual consumption and load factors, and then multiplied by a bunker unit cost. They are intended to work both pre- and post-cap implentation, with 0.5% sulphur compliant fuel cost increments expected to have some impact around November this year, but not before, according to CTI\u2019s Lane.<\/p>\n
\u201cThere is some disparity over the suggested premiums,\u201d Lane said. As an example, he cited MSC who have suggested an Asia-North Europe headhaul BAF of $248 per teu \u2013 and $96 for backhaul – based on bunker costs of $400 per metric ton. Japan\u2019s ONE, meanwhile, has given a number of $125 per teu for the headhaul and $100 per teu for backhaul against a bunker price of $500 per metric ton.<\/p>\n
\u201cDepending upon actual consumption and utilisation assumptions, ONE\u2019s BAF does not appear to cover the full cost of fuel whereas MSC\u2019s does plus a little bit,\u201d Lane pointed out.<\/p>\n
Bunker costs per metric ton have decreased by more than 20% since October 2018, which is conspiring against the lines\u2019 new mechanisms which were designed to attain better, higher cost recovery.<\/p>\n
\u201cA total freight cost increase in January 2019 therefore is not so logical,\u201d Lane said, arguing against the Freightos prediction.<\/p>\n
\u201cFor each service contract, shippers will have their exclusively negotiated deals, presumably taking the total cost of ownership – basic freight plus BAF – into consideration when selecting carriers,\u201d Lane continued, adding: \u201cOn the spot market the total freight plus BAF which can be levied will continue to be driven by supply\/demand perceptions, and the lines will continue to need to be cost-competitive, so an overall shipping cost increase is far from given.\u201d<\/p>\n
The controversial sulphur cap surcharges introduced by the world\u2019s top lines has drawn predictable ire from shippers.<\/p>\n
Sunny Ho, executive director of the Hong Kong Shippers\u2019 Council, told Splash<\/em> last year he was not in favour of more surcharges, preferring that additional costs be factored into freight rates.<\/p>\n\u201cCarriers should make their revenue through freight rates, instead of surcharges, or other charges,\u201d Ho said in an interview last September.<\/p>\n
The British International Freight Association (BIFA) went further saying the new sulphur cap surcharges are unjustified and are blatant profiteering.<\/p>\n
\u201cWhile the shipping operators may say that the new BAFs are needed to cover the cost of switching to low sulphur fuels or fitting exhaust scrubbers, rises of this magnitude are unjustified and could be construed as blatant profiteering by shipping lines determined to exploit the situation,\u201d Robert Keen, BIFA director general, said in a release from last September.<\/p>\n","protected":false},"excerpt":{"rendered":"
This week sees the world\u2019s top containerlines start new bunker surcharges with the 2020 global sulphur cap in mind. Box platform Freightos is predicting this will result in price rises of between 5 to 10%, depending on tradelane \u201cThese increases, beginning January 1, will filter through next week with price rises in the 5%-10% range, …<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_ml_titleColor":"#000000","_ml_titleFont":"Roboto","_ml_titleFontSize":1.136,"_ml_titleFontWeight":"400","_ml_titleLineHeight":1.3,"_ml_metaColor":"#708090","_ml_metaFont":"Montserrat","_ml_metaFontSize":0.6785,"_ml_metaFontWeight":"400","_ml_metaLineHeight":0.92,"_ml_bodyColor":"#a9a9a9","_ml_bodyFont":"Open Sans","_ml_bodyFontSize":0.85,"_ml_bodyFontWeight":"400","_ml_bodyLineHeight":1.2,"_ml_wooPriceColor":"#666","_ml_wooPriceFont":"Open Sans","_ml_wooPriceFontSize":0.9,"_ml_wooPriceFontWeight":"400","_ml_wooPriceLineHeight":1.27,"_ml_headingColor":"#000","_ml_headingFont":"Merriweather","_ml_headingFontSize":2.02,"_ml_headingFontWeight":"700","_ml_headingLineHeight":1.47,"_mlglobal_userfontcolors":{"headingColorUser":[],"titleColorUser":[],"metaColorUser":[],"bodyColorUser":[],"wooPriceColorUser":[]},"_uag_custom_page_level_css":"","footnotes":""},"categories":[56,62,68],"tags":[103],"yoast_head":"\n
Shippers brace as new sulphur cap surcharges kick in - Splash247<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/splash247.com\/shippers-brace-as-new-sulphur-cap-surcharges-kick-in\/\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Shippers brace as new sulphur cap surcharges kick in - Splash247\" \/>\n<meta property=\"og:description\" content=\"This week sees the world\u2019s top containerlines start new bunker surcharges with the 2020 global sulphur cap in mind. 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