The Transpacific Stabilization Agreement (TSA) said its members will apply a low-sulfur fuel charge beginning on Oct. 1.
The discussion agreement of 15 of the leading container carriers said the charge will be based on the price differential between low-sulfur and standard marine bunker fuel and how much time a ship spends within 200 miles of the U.S. and Canadian coasts where they must burn cleaner fuel with a lower sulfur content.
Initially the charge will be $17 per 40-foot container to the U.S. West Coast, and $21 per FEU to the U.S. East and Gulf coasts.
On Aug. 1, the United States and Canada began enforcing a requirement
that ships burn low-sulfur fuel within 200 miles of most of their coast line, an area known as the North American Emissions Control Area that includes most of the coasts of the two countries, other than in the far North.
According to price data reporting service Platt’s, price differentials between standard bunker and premium low-sulfur fuel at the four key loading locations used to calculate the TSA component – Los Angeles/Oakland, Seattle, Charleston and New York – ranged from $87 to $260 per metric ton as of mid-August. TSA lines report spending just under 2.7 sailing days per voyage within the North American ECA
to the U.S. West Coast, and just over 4.4 days to the East and Gulf Coasts.
“The relative added cost per FEU aboard ship as reflected in the charge is not huge, but the overall cost impact per sailing across the entire trade is significant,” said TSA Executive Administrator Brian M. Conrad. “Lines with scheduled services are also concerned about the spike in demand for low-sulfur fuel created by the ECA, and effects in the near and midterm on supply and price.”
TSA members include APL, China Shipping, COSCO, CMA CGM, Evergreen, Hanjin, Hapag-Lloyd, Hyundai, "K" Line, Maersk, MSC, NYK, OOCL, Yang Ming, and Zim. - Chris Dupin