World News
Smaller Carriers will Feel a Greater Impact from ECA Rules
Smaller, local carriers will feel the brunt of Emission Control Area (ECA) regulation compliance from rising fuel costs more than larger carriers, local Bermuda press reports.
Barry Brewer, president of Neptune Ltd, which owns Bermuda Container Line, said that the rules are expected to raise the cost of shipping from the U.S. to Bermuda by $50 to $55 per container.
"This new policy does not just affect ships in Bermuda, this has effects to the shipping industry across the globe," he said.
"For some of the bigger shipping companies that have lots of vessels these new laws will not have a major impact.
"But for smaller carriers like the ones in Bermuda, the impact is more significant."
Beginning January 1, 2015, sulfur content in marine fuel used in ECAs cannot exceed 0.10 percent by weight.
Brewer, however, assured that the extra costs wouldn't "jeopardize" the company.
As regulations take hold, companies have had the choice to switch to marine diesel oil, which has lower sulphur content, or turn to alternative solutions such as liquefied natural gas (LNG) or exhaust emission scrubbers.
Shippers all over the world have also made decisions to pass on the extra fuel costs to customers, as freight rates are expected to increase.
Last week, Danish freight operator DFDS Seaways estimated that ECAs would raise rates by 15 percent.
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 655.50 | 2.00 | 808.50 | 4.50 |
| Rotterdam | 619.00 | 0.00 | 789.00 | 8.00 |
| Houston | 628.50 | 7.50 | 812.50 | 1.50 |
| Fujairah | 653.50 | 4.50 | 900.00 | 2.50 |
| Global 20 Ports Average | 672.00 | 0.50 | 885.00 | 7.00 |
| Global 4 Ports Average | 639.00 | 2.50 | 827.50 | 2.00 |
| Global Average Bunker Price | 727.50 | 1.50 | 933.50 | 5.00 |
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