Export freight rates have increased significantly since the introduction of the International Maritime Organisation’s (IMO) 2020 sulphur cap in January this year.According to Mike Walwyn, chairman of the Cape’s Port Liaison Forum (PLF), while the rate increase is dependent on the trade lane on which the cargo is moving, rates for cargo out of South Africa have increased by anything from $100 to $150 per TEU.“The increase does vary widely. In some cases it can be as high as $600 per TEU.”While the IMO has taken bold steps to clean up shipping emissions, introducing a low sulphur fuel cup of 0.5%, it has resulted in higher bunker charges across the globe.Under the new global cap, ships have to use fuel oil on board with a sulphur content of no more than 0.50% mass by mass, down from the former limit of 3.50%. Low Sulphur fuel is however more expensive as refineries have had to undergo extensive infrastructure upgrades to produce the new fuel.Some shipping lines have opted instead to fit scrubbers on vessels to meet the regulation requirements. This capital outlay has also driven up cost, while it has in some cases affected capacity as vessels have had to create space. This is also the case for vessels that have opted to rather use LNG and have been fitted with gas tanks.All of this had led to a significant increase in the cost of shipping, said Wa lw y n.In a statement the International Bunker Industry Association (Ibia) said it had met with several large global shipping and bunkering companies in January and for the most part the transition to a lower sulphur fuel had been smooth.This was attributed to planning and preparations undertaken well in advance of the actual transition.“In general, the ship owners and operators as well as bunker providers Ibia met in Copenhagen had not experienced major issues with the availability of compliant fuel, although shortages have been evident in some regions. They did note that the year had started off with a sharp rise in premiums for very low sulphur fuel oil compared to high sulphur fuel oil (HSFO),” reads the statement.Unni Einemo, Ibia director, acknowledged that the price volatility and higher prices could be painful in the interim