MSC, CMA CGM Join Maersk with "Inevitable" IMO 2020 Bunker Surcharges

CMA CGM's surcharge is being implemented from January 1, 2019. Image Credit: CMA CGM

Major box shipping players CMA CGM Group and MSC Mediterranean Shipping Company S.A. (MSC) today announced they will implement a new surcharge to offset the cost of complying with the upcoming 0.50% global sulfur cap on marine fuel.

CMA CGM says it estimates the so-called IMO 2020 rule to add additional costs averaging $160 per TEU.

"The implementation of this new regulation, which represents a major environmental advance for our sector, will affect all players in the shipping industry," says Mathieu Friedberg, Senior Vice President Commercial Agencies Network.

"In line with its commitments, the Group will comply with the regulation issued by the IMO as from 1 January 2020. In this context, we will inevitably have to review our sales policy regarding fuel surcharges."

While CMA CGM did not say when it would implement the new surcharge, MSC today said it will implement its new IMO 2020-oriented Global Fuel Surcharge as of January 1, 2019 "in order to help customers plan for the impact of the post-2020 fuel regime."

"The new MSC Global Fuel Surcharge will replace existing bunker surcharge mechanisms and will reflect a combination of fuel prices at bunkering ports around the world and specific line costs such as transit times, fuel efficiency and other trade-related factors," the carrier says.

"The cost of the various changes we are making to our fleet and its fuel supply is in excess of two billions of dollars (USD) per year."

Further details of its plans will be released in due course, MSC added.

CMA CGM and MSC join Maersk in implementing such charges, with the world's biggest box carrier making a similar announcement last week.

The trio represent 44% of the world's total box carrying capacity, according to Alphaliner.