The International Maritime Organization (IMO), a subsidiary of the United Nations, has introduced new regulations to reduce marine pollution caused by the shipping industry.
IMO regulation establishes that the maximum percentage of sulphur contained in the marine fuel.
One of these new regulations is the IMO2020, whose decision was taken in 2016, which requires all vessels to use fuel with a maximum sulphur content of 0.5% as of January 1, 2020 outside the ECA (Emissions Control Areas) zones, which are already at a 0,1% level.
At present, the maximum sulphur content is 3.5%. IMO2020 will bring significant benefit to the environment and to human health. At the same time, compliance with such regulation will have an important financial, operational and technological impact for the shipping industry. The experts estimate to initially amount up to 60 billion US dollars annually for the entire shipping industry.
This is major change and challenge for the shipping lines, whose costs will be passed along. Carriers will start implementing pilots trials using a mix of different solutions (scrubbers, compliant fuel, LNG) from third or four quarter of 2019. For this reason, we expect ocean freight rates to substantially increase from Q4/2019 due to this rise in bunker costs.
In order to get a better understanding of this regulation, we prepared an informative paper to explain it.
For any questions about IMO2020 and ECA regulations, please contact Mr. Alberto Rivola, Head of Global Ocean Procurement, at: alberto.rivola@savinodelbene.com
