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(WASHINGTON) — On Thursday, President Joe Biden, joined at the White House by Rep. John Garamendi, D-Calif., Sen. Amy Klobuchar, D-Minn., Sen. John Thune, R-S.D., and Rep. Dusty Johnson, R-S.D., signed the Ocean Shipping Reform Act into law.

In August 2021, Garamendi introduced the act with Johnson to provide the Federal Maritime Commission (FMC) with the regulatory power to support American exporters, protect consumers, and establish reciprocal trade opportunities to reduce the nation’s longstanding trade imbalance with countries like China.

Klobuchar and Thune sponsored the companion legislation in the Senate.

“Today is the culmination of over a year of hard work to crack down on longstanding inequities for American exporters and shippers in the international ocean shipping industry,” Garamendi said. “It shows that Republicans and Democrats can come together to solve critically important problems. American families and small businesses are facing shortages and rising prices during the COVID-19 pandemic and Putin’s war in Ukraine. Our bipartisan Ocean Shipping Reform Act will protect American businesses and consumers from unfair trade practices and price gouging by foreign-flagged ocean liners and address our nation’s longstanding trade imbalance with countries like China.”

The Ocean Shipping Reform Act will:

• Require ocean carriers to certify that late fees — known in maritime parlance as “detention and demurrage” charges — comply with federal regulations or face penalties.
• Shift burden of proof regarding the reasonableness of “detention or demurrage” charges from the invoiced party to the ocean carrier.
• Require ocean common carriers to report to the FMC each calendar quarter on total import/export tonnage and 20-foot equivalent units (TEUs, loaded/empty) per vessel that make port in the United States.
• Authorize the FMC to self-initiate investigations of ocean common carrier’s business practices and apply enforcement measures, as appropriate.
• Establish a new authority for the FMC to register shipping exchanges.

Statement from President Biden:

“Lowering prices for Americans is my top priority, and I applaud the Congress for passing the Ocean Shipping Reform Act on a bipartisan basis, which will help lower costs for American retailers, farmers and consumers. I want to thank Sen. Klobuchar, Sen. Thune, Rep. Garamendi, and Rep. Dusty Johnson for their leadership and helping drive forward this important legislation.

“In my State of the Union address, I called on Congress to address ocean carriers’ high prices and unfair practices because rising ocean shipping costs are a major contributing factor to increased costs for American families. During the pandemic, ocean carriers increased their prices by as much as 1,000 percent. And, too often, these ocean carriers are refusing to take American exports back to Asia, leaving with empty containers instead. That’s costing farmers and ranchers — and our economy — a lot of money.

“This bill will make progress reducing costs for families and ensuring fair treatment for American businesses — including farmers and ranchers.”

Statement from the World Shipping Council:

“Recent weeks have seen several attempts to demonize ocean carriers by deploying ‘us versus them’ rhetoric. That is not only inaccurate but dangerous, as it undermines the ability to understand and work towards solving the root causes of America’s supply chain problems. Ocean carriers are the longest link in the global supply chain that delivers vital supplies to American business, government and consumers. The supply chain is not foreign; it is global.

“It is understandable that regulators ask questions with the current market conditions. Liner shipping is a very closely monitored industry, and carriers have answered and will continue to answer those questions. But the fact is that ocean carriers actively compete against one another in the global marketplace, including on the shipping lanes most relevant for U.S. trade.

“The expert U.S. regulator that oversees international shipping – the Federal Maritime Commission – just completed a two-year investigation into the international ocean supply chain, finding that ocean carrier competition is ‘vigorous’ and that while ocean freight prices are high, they are ‘exacerbated by the pandemic, an unexpected and unprecedent surge in consumer spending particularly in the United States, and supply chain congestion, and are the product of the market forces of supply and demand.’

“The FMC also stated that ‘Competition officials of the European Union, China, and the Federal Maritime Commission regularly discuss our ocean shipping markets and we have, to date, observed no indication that the current prices for liner shipping are a result of collusive or illegal conduct on the part of the major ocean carriers in our markets.’

“The worn-out talking point that ‘there’s only nine major ocean shipping lines who ship from Asia to the United States’ is also untrue. While nine lines in and of itself is evidence of competition and not concentration, there are an additional 13 ocean liner companies that operated over 30 percent of the sailings from Asia to the U.S. so far this year. In fact, competition increased during the pandemic, with new shipping services entering the market and the share of the largest alliances dropping.

“The FMC investigation also reports that ‘the individual ocean carriers within each alliance continue to compete on pricing and marketing independently and vigorously. Individual ocean carriers within alliances continue to add and withdraw vessels from trades both inside and outside the alliances in which they participate and, particularly in the transpacific, new entrants have been entering the trade. The trans-Pacific is a highly contestable market.’

“There is no dispute that carriers, after two decades of low or no margins and cheap and abundant capacity for shippers, are actually making profits. These profits are invested in building capacity for the future on land and sea. In 2021, carriers ordered a record-breaking 561 vessels worth $43.4 billion, and 208 vessels worth $18.4 billion have been ordered year-to-date in 2022. But as long as America’s ports, rail yards and warehouses remain overloaded and unable to cope with the increased trade levels, vessels will remain stuck outside ports to the detriment of importers as well as exporters. Ocean carriers continue to move record volumes of cargo for our country and have invested heavily in new capacity – America needs to make the same commitment and invest in its landside logistics infrastructure.”

The Cruise Division of MSC Group and French shipbuilder Chantiers de l’Atlantique celebrated two important milestones this past weekend for MSC Cruises’ first two LNG-fueled cruise ships.

MSC World Europa completed her first set of sea trials in the Atlantic Ocean. The tests included measuring the performance of the ship’s engines, along with assessing its maneuverability, fuel consumption, safety systems, speed and stopping distances.

MSC World Europa will be the first LNG-fueled vessel to join the cruise line’s fleet in November 2022 and is set to become the largest LNG-fueled cruise ship in the world.

Meanwhile, sister ship MSC Euribia was floated out and moved to a wet dock at the shipyard for work to continue before she joins MSC Cruises’ fleet in June 2023.

MSC has invested more than $3.14 billion in three LNG-powered cruise ships. The construction of the third ship – World Class II – will begin at Chantiers de l’Atlantique early next year.

“We made an important pledge last year to achieve net-zero greenhouse gas emissions by 2050, leading the cruise industry on the path to decarbonization,” said Pierfrancesco Vago, executive chairman, Cruise Division, MSC Group. “MSC World Europa and MSC Euribia will play a fundamental role in this journey.

“LNG is the cleanest marine fuel currently available at scale that reduces emissions significantly and offers compatibility with future alternative fuel solutions,” he continued. “We are actively investing in research and development regarding LNG, including a pilot LNG-powered solid oxide fuel cell onboard MSC World Europa. If bio or synthetic LNG was available at scale today, both our newbuilds could operate with net zero emissions from the very first day.”

NEXT-GENERATION CRUISE EXPERIENCE

MSC World Europa is the first ship in the MSC World Class – a class of ships that will introduce a completely new cruising platform and accommodate up to 6,762 passengers.

The ship will incorporate future-proof marine and onboard hospitality technologies. The ground-breaking design features a Y-shaped aft that leads to an impressive 341-foot long, open-air Europa Promenade with breathtaking ocean views. Brand new balcony cabins overlook the space, which features a striking architectural centerpiece in the form of an 11-deck-high dry slide set to be the longest at sea.

MSC Euribia will become one of the most environmentally advanced ships in MSC Cruises’ fleet and is named after the ancient goddess Eurybia, who harnessed the winds, weather and constellations to master the seas. The ship will have a noticeably different look than others in MSC Cruises’ fleet thanks to exclusive artwork that transforms her hull into a giant, floating canvas to communicate the importance of sustainability and the company’s commitment to the sea.

The number of containers being lost overboard from ships at sea has been on the rise, according to a recent report from the World Shipping Council (WSC).

In 2021, international liner carriers’ onshore staff and crews managed 6,300 ships, successfully delivering vital supplies worth $7 trillion to the people of the world, in approximately 241 million containers. The WSC Containers Lost at Sea Report covering 2020-2021 shows that containers lost overboard represent less than one thousandth of 1% (0.001%). However, the past two years have seen a worrying break in the downward trend for losses, with the average number of containers lost at sea per year since the start of the survey increasing by 18% to 1,629.

Several factors ranging from severe weather and rough seas to more catastrophic and rare events like ship groundings, structural failures and collisions can result in containers being lost at sea. The winter of 2020-21 saw an unusually high number of weather-related incidents, and the average losses for the two-year period 2020-2021 were 3,113 compared to 779 in the previous period.

“Container vessels are designed to transport containers safely and carriers operate with tight safety procedures, but when we see numbers going the wrong way, we need to make every effort to find out why and further increase safety,” said John Butler, president and CEO of WSC.

Maritime actors across the supply chain have initiated the MARIN Top Tier project to enhance container safety, with WSC and member lines among the founding partners. This project will run over three years and will use scientific analyses, studies, and desktop as well as real-life measurements and data collection to develop and publish specific, actionable recommendations to reduce the risk of containers lost overboard.

Initial results from the study show that parametric rolling—when a vessel experiences a large unstable rolling motion from side to side in head or stern seas—in following seas is especially hazardous for container vessels, a phenomenon that is not well known and can develop unexpectedly with severe consequences. To help in preventing further incidents a Notice to Mariners has been developed, describing how container vessel crew and operational staff can plan, recognize and act to prevent parametric rolling in following seas. Many more topics, tests and measurements will be undertaken by the project, which will continue reporting on progress and sharing insights on a regular basis through the IMO and other forums.

“The liner shipping industry’s goal remains to keep the loss of containers as close to zero as possible. We will continue to explore and implement measures to make that happen and welcome continued cooperation from governments and other stakeholders to accomplish this goal,” Butler said.

In addition to the MARIN TopTier project, WSC and member companies have actively contributed to and supported revision of the IMO’s guidelines for the inspection programs for cargo transport units. WSC said it also supports the creation of a mandatory reporting framework for all containers lost at sea—an issue that will be on IMO’s agenda in September (CCC 8).

The Containers Lost at Sea Report has until now been updated every three years, but concerned by the unusually high number of incidents in the winter of 2020-21, WSC decided to increase the frequency of its Containers Lost at Sea report. Hence, this update covers 2020-2021, and in the future a survey of members will be carried out each year.

The computational fluid dynamics (CFD) industry faces increasing demand for efficiency, accuracy, and speed. In the shipping industry, rising fuel prices comprise more than half of expected shipping operating budgets, and especially when working with big volume vessels, even the most minor improvements in fuel consumption can save millions of dollars. Therefore, maximizing efficiency and optimizing every aspect of a vessel design is crucial, and CFD offers unprecedented possibilities for obtaining optimal design solutions.

Cadence® Fidelity™ Marine CFD simulation comprises dedicated, virtual naval architecture and marine design tools that function as a virtual towing tank, offering easy-to-use, scalable, highly automated optimization processes and unparalleled free surface modeling. Solve and optimize propulsion, resistance, seakeeping, wind studies, and maneuvering in your designs through our dedicated workflows and team. Equip yourself with the utmost accuracy and efficiency with Cadence CFD solutions.

With constantly changing sea, transport, loading, and racing conditions impacting the performance of your designs, hundreds or even thousands of simulation runs may be required for you to finalize a design and feel fully confident about the accuracy of its results. Automation is therefore crucial for minimizing turnaround speeds without compromising the accuracy of the results. Our solutions have automation in place for resistance at low and high Froude numbers, seakeeping, (self-)propulsion, trim optimization, open water propellers, and many other facets of ship CFD analysis. Our team of naval engineers has worked closely with our customers to create dedicated automation workflows. Whether you are deep in an America’s Cup or Vendee Globe campaign or are working to reduce drag and improve the propulsion efficiency of ships, you can trust our automated capabilities to provide you optimal results with accuracy and speed.

The Fidelity CFD platform is the end-to-end solution for all CFD-related applications. The dedicated tools within Fidelity CFD can solve each step of the simulation process quickly and efficiently. Furthermore, Fidelity CFD was designed with ease of use in mind with an intuitive and application-driven interface or through automated processes with the Python API or optimization module available.

Amid pressure from NGOs and governments, shipping could be moving towards net zero by 2050, instead of the initial goal set of a 50% emission reduction. In its latest weekly report, shipbroker Gibson said that “last Friday saw the close of the much-anticipated Marine Environmental Protection Committee (MEPC 78) meeting at the IMO. The main focus was to progress IMO policy to build an effective greenhouse gas emissions (GHG) reduction strategy to be approved at MEPC 80 in 2023. Whilst the meeting was never intended to be a decision-making event, it did signal that sufficient momentum and support exists among most member states for the IMO to begin setting more ambitious targets and policy that will be centre stage at upcoming IMO meetings. However, environmental and industry groups have been critical of the MEPC for failing to achieve unanimous support amongst all members. They highlight the relative pace of decarbonisation proposed by the IMO and the ability of shipping to remain aligned to the 1.5C target agreed in the Paris Climate Agreement. This will only add to the pressure of subsequent IMO meetings to secure a plan for achieving adequate decarbonisation whilst ensuring an equitable transition process that can achieve broad member state support”.

According to Gibson, “in terms of what was achieved, two points stand out. Firstly, there appears to be support for achieving zero carbon emissions by 2050 instead of just a 50% reduction in emissions. The technical guides for EEXI, CII and SEEMP regulations have been finalised and adopted for future implementation. This will be crucial for setting the trajectory of industry emissions out to 2050. Several environmental groups are advocating bringing forward the trajectory for achieving net zero emissions by 2040 and halving emissions by 2030; although this does not seem to be on the IMO’s agenda at present given the challenges of achieving such reductions and the lack of support from some member states. Therefore, it appears these measures will be approved at MEPC 80 where lifecycle emissions guidelines are also likely to be agreed”.

The shipbroker added that “secondly, the proposal to establish a Sulphur Emission Control Area (SECA) in the Mediterranean Sea was approved for adoption at MEPC 79 in December 2022. This would require the use of bunker fuel with a sulphur content no greater than 0.1% such as low sulphur MGO or a scrubber system for vessels trading in or passing through the Mediterranean. If there are no delays, the Mediterranean SECA could be implemented as early as 2025. It is also worth noting that the likely inclusion of shipping into the EU ETS from 2023 will add an extra layer of complexity and cost on top of already highly elevated bunker prices”.

Gibson also noted that “another notable aspect of MEPC 78 was the rejection of a proposal by the International Chamber of Shipping (ICS) for a $5bn decarbonisation research and development fund that would have provided a market-based approach to reducing shipping’s carbon emissions. The plan focused on a mandatory levy of $2/tonne on bunker fuel that would have financed zero emission technology and had the backing of most major shipping bodies. This would have helped facilitate the application of new technologies at scale, although its rejection signals a reluctance by the IMO to be responsible for managing and supervising such a scheme. Any future proposed market solutions will likely have to be operated at the industry level instead of seeking official approval and implementation at the IMO if such proposals are to have any role in decarbonising shipping”.

“As the market looks ahead to MEPC 79-80, many will now be finalising their plans to achieve compliance with the proposed IMO regulations, especially in terms of CII and EEXI. MEPC 78 gives owners an indication that the IMO is now more committed to reducing the industry carbon emissions to net zero by 2050 and are unlikely to be watered down by some member states, given the broad support that exists both inside and outside shipping for concrete action”, the shipbroker concluded.
Nikos Roussanoglou, Hellenic Shipping News Worldwide