The International Maritime Organisation (IMO) decision to implement a 0.50% sulphur cap on marine fuel from 2020 is likely to increase the demolition rate of older vessels in the multipurpose fleet.
This is according to Susan Oatway, senior analyst for multipurpose and breakbulk at Drewry Maritime Research, who says the sulphur cap is top of the agenda in the shipping industry at present.
She describes it as arguably one of the industry’s most defining moments since the shift away from coal. The current global sulphur cap is 3.5%, while the average sulphur content of today’s heavy fuel oil (HFO) bunkers, which is by far the most common type of marine fuel burned, is around 2.7%.
Only vessels that equip themselves with exhaust gas cleaning systems (scrubbers) will be able to continue burning these same bunkers from 2020.
“Vessels in the project carrier and multipurpose sector are far more likely to opt for lower sulphur fuel than to put scrubbers on,” said Oatway. “The likelihood of scrubbers being put on ships is not high due to the extra cost involved and we believe they are much more likely to go the low sulphur fuel route.”
She said while this would also have some cost implications it would in all probability be passed on to the receiver.
