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What to watch

Maersk’s decision to accelerate its carbon-neutral vessel programme adds pressure on its peers to do follow suit, and on regulators to be more aggressive in defining the industry’s decarbonisation ambitions. The expectations have now been raised and for the pioneering container line industry at least, the efforts to decarbonise need to accelerate.

Maersk Tankers is stepping up pressure for immediate action to reduce ship emissions, even if that requires regional measures while waiting for a global decarbonisation strategy to be agreed. Chief executive Christian Ingerslev tells Lloyd’s List the shipping industry needs to engage with Brussels as the European Union takes a closer interest in green shipping and clean fuel initiatives, rather than insist that the International Maritime Organization should be the only body responsible for rule-making on urgent matters such as decarbonisation.

Analysis

Box carriers’ pricing behaviour shows prioritisation of short-term profitability over customer relationships, a move that while questionable would have seen them otherwise forego the largest price boom in recent history.

Container lines have been focusing on buying replacement tonnage as their fleets age, but it has mainly been for ultra-large vessels. The low orderbook and need for more capacity is drawing tonnage providers back to the market, reports James Baker in this month’s World Fleet Update.

Opinion

From the News Desk: Shipping’s safety record has improved but more can and should be done to avoid costly errors. Unlike many costs, safety is cheaper when you pay upfront. DNV GL’s warning of a “looming safety gap” in the green transition comes amid concerns over firefighting standards, asbestos on ships, and even lack of piracy protections. As ever, more attention to the human element is needed.

Markets

China’s centrality to global trade was further emphasised in 2020 when its leading container hubs continued to record volume growth, despite all the lockdown-led supply chain disruptions.

The US state of Texas has ordered a halt in gas exports through to this Sunday to tide over supply pressure to domestic users arising from severe cold weather. This will hurt shipping tonne-miles as the US looks set to cut shipments, including those heading to buyers in the Far East. 

Freight rates for bulker panamaxes have been pushed up as available tonnage in the Atlantic region is limited. US Gulf and east coast South America are absorbing a great number of ballasters from the Asia-Pacific, while thickening sea ice in the Baltic Sea is further boosting rates.

In other news

P&I club Gard regards the 2021 renewal round as “a renewal of consolidation”, according to chief underwriting officer Bjornar Andresen. The International Group affiliate has adopted a ship-by-ship pricing strategy rather than an across-the-board general increase this year. 

Increasing demand for Panama Canal transits has encouraged the Panama Canal Authority to raise its reservation and services fees. The ACP had frozen fees for the past year.

Star Bulk has reported higher operating costs related to crew changes. The largest US-listed dry bulk owner, which has been on a buying spree, says it remains optimistic about the market dynamics, with a record low orderbook and strong demand fundamentals.

Golden Ocean, the dry bulk outfit ultimately owned by billionaire John Fredriksen, expects positive market dynamics to unfurl through 2021, and beyond. Rates during the first quarter so far have been the highest in recent years, suggesting a tight supply-demand balance in the market. 

Singapore-listed FSL Trust is divesting two product tankers that are still under construction amid weaker shipping demand from slower trades of oil and oil products.

The port of New York and New Jersey saw a record year for container throughput in 2020, rising to some 7.6m teu by the end of what officials called a tumultuous time of ups and downs due to the lockdowns.

The port of Los Angeles will see some incoming containerships diverted to other US west coast ports in an effort to reduce the backlog of cargo on vessels currently at anchor and awaiting berths.