EMEA News
Dan-Bunkering Upbeat on Bunker Market Challenges
Conducive market conditions are driving expansion at Dan-Bunkering where players able to access a bigger pool of credit are going to be doing pretty well in a market in the midst of fundamental change.
"The estimates vary," Christoffer Berg Lassen, chief executive at Dan-Bunkering told Ship & Bunker. "But one thing is certain, there is going to be a greater need for credit in the bunkering space which we are in a position to supply."
The need for credit is a consequence of the International Maritime Organisation decision to cap the sulfur content of bunker fuel at 0.5% down from its current 3.5%. That move, in place from the start of 2020, will see a switch to more expensive distillates as shipping's fuel of choice thereby grossly inflating a ship operator's fuel bill.
"Ships are going to be using the same amount of fuel in terms of the volume only the cost of it is going to increase. And that has to be covered."
But greater credit, while necessary, comes at a cost which will be reflected in the shipowner's fuel bill. Wouldn't that subtract from rather than add to business at Dan-Bunkering?
Lassen doesn't think so. It's not just a question of having the credit, it's also about finding a company that has access to that credit.
And as part of Bunker Holdings Group, Dan-Bunkering has that access.
"At the same time, we find ourselves as one of the few known global bunker brands out there. Business is coming to us right now," Lassen said.
Margins are tight and as some players consider drawing back from the bunker market, there is a net benefit for those who stay.
"Market conditions are in our favour right now which is why we are hiring staff."
Lassen is also confident in the company's comprehensive staff development programme. As the market is about to deal with a major change to the way it works, keeping its employees is vital, he said.
