The world’s largest cash buyer of ships for recycling will be at Posidonia 2022 and on the lookout for like-minded shipowners to deliver ESG friendly ship recycling.

A fundamental shift in attitudes towards ship recycling is forcing a change in the way owners deal with scrapping.

Operating shipowners, private equity and tonnage providers feeling the heat from cargo clients, banks and investors are now being urged to engage with the entire ship recycling process – from the sale contract to the last steel plate lifted ashore.

GMS’s Head of Green Recycling, Dr Anand Hiremath, says that evidence of the shift is overwhelming.

“Look at the data. Last year, for the first time, every ship GMS sold to India went to a yard holding Hong Kong Convention Statement of Compliance.”

Pressure from prominent shipping banks that work closely with ship cash buyers and other stakeholders such as DNB and Nordea to improve standards is taking the form of solid recommendations to their owner clients to get closely involved in ship recycling. Engagement, they say, will minimize the impact on the environment and society that results from poor recycling practices.

Getting involved typically involves developing a company recycling policy, obtaining an Inventory of Hazardous Materials (IHM) for every ship in the existing fleet, using fewer hazmats used during construction, conducting due diligence of scrap yards, proper supervision, and documentation at the waterfront. Involvement can also extend to inserting responsible ship recycling clauses in sale contracts for ships approaching the end of their trading lives.

Changing commercial landscape

Senior Trader of top cash buyer of ships for recycling, GMS, Vagelis Chatzigiannis acknowledges that historically there has been a reluctance to engage with green recycling from some quarters. But he points to the ever-growing number of high-quality ship recycling yards in India combined with ESG pressure on owners as main drivers for the shift in both attitude and practices. “The landscape is changing for sure. Owners who were solely price-driven are considering the impact of the continuously changing ESG environment. Green deals, involving yard selection and auditing, supervision and documentation are now very much part of our daily trading activities,” he says.

Chatzigiannis says ship and offshore owners are now looking for turnkey green solutions. “We aren’t simply ship cash buyers; We actively walk clients through the ship recycling process hand to hand, and cover all aspects of their recycling needs from regulatory, commercial and operational aspects; not just delivery of the units, but including completion of the recycling process and the issuance of the recycling completion certificate.

He adds that owners now want to see evidence and hard facts about the benefits of opting for a green solution. “It is important to be able to quantify the benefits and savings to the environment by choosing ESG practices, which our SSORP can deliver.”

Singapore based GMS trader Jamie Dalzell believes owners are helping to force the pace of change. ‘We are seeing more requests for HKC compliant offers these days as owners seek to comply with growing ESG requirements. This is indeed encouraging and in turn, leads to an increase in the number of yards along with upgrades on existing HKC yards as they seek to satisfy this demand.’

No short cuts

The person in charge of SSORP, Dr Anand Hiremath holds a PhD in ship recycling and divides his time advising shipowner clients and recyclers on delivering a green solution.

He recognizes the challenges but is proud of his team’s achievements. “Our purpose is safer and greener recycling – up to now, 102 ships (including 25 offshore units) have been safely recycled under our supervision. The SSORP team has completed more projects than any other compliance monitoring company in the world.”

He says the services required by owners are all significant contributors to responsible recycling. “Typically, the work involves preparing the Inventory of Hazardous Materials (IHM), helping the yard develop a Ship Recycling Plan, evaluating the Ship Recycling Facility Plan, hazardous waste management, risk assessment, daily safety observation, effective implementation of ship recycling plan, estimation of carbon footprint, monitoring the recycling process and providing a weekly/monthly/ completion report as per HKC guidelines.”

Dr Hiremath says owners are looking for full transparency backed up by accurate data. “Under SSORP, we collect 281 data points during the compliance monitoring process. But it is not all about the number of data points – more the transparency and accuracy we bring, acting as shipowner’s eyes and ears at ground zero”.

Source: https://www.maritimelondon.com/news/gms-pioneers-esg-friendly-recycling-solutions

The research vessel Polarstern has departed on a seven-week-long voyage to the Arctic, where the onset of summer also marks the beginning of the annual sea-ice melting. 

Over the past 40 years, the summer sea-ice extent has decreased by 40 percent – making it one of the most visible impacts of climate change. In a process study to be conducted in the marginal ice zone, the team of researchers on board will investigate how heat fluxes and water layering in the ocean, as well as the characteristics of the ice, interact and influence melting. A further focus of the expedition will be on the warming produced by Atlantic Water circulation and its effects on marine glaciers in northeast Greenland.

From her home port in Bremerhaven, the Polarstern will set course for Fram Strait and the marginal ice zone north of Svalbard, where warm, nutrient-rich Atlantic Water flows into the Arctic Ocean. Closely monitoring energy and material flows in the marginal ice zone from the ship and from on ice floes is the goal of the team led by Prof Torsten Kanzow, expedition leader and a physical oceanographer at the Alfred Wegener Institute, Helmholtz Centre for Polar and Marine Research (AWI).

Kanzow explains:

“We will make transects from the open water into the dense sea ice and back. Along the way, we will gather a variety of physical, chemical and biological measurements in the marginal ice zone, which is especially productive and therefore especially interesting. The team will also venture onto the ice to take a closer look at the thickness and characteristics of the sea ice and measure ocean currents and eddies away from the ship. We’ll also deploy so-called gliders in the ocean, buoys on the ice and moorings on the seafloor, all of which will record valuable data for the next several years. Lastly, we’ll extend our research radius with helicopter flights, during which we’ll observe, for instance, the melt ponds on the ice.”

The study will be supplemented with atmospheric research, in which the characteristics and flows of aerosols and greenhouse gases in the atmospheric boundary layer, as well as the distribution of water vapour and clouds, will be evaluated. A further project is intended to show how oceanographic fronts, eddies and the ice edge itself, as well as sea-ice characteristics (melt ponds and light transmission), influence carbon export. In order to quantify the latter, the experts will assess the nutrient supply in the sunlit zone, as well as the distribution of phytoplankton and zooplankton (including jellyfish) and primary and net community production. This fieldwork in the marginal ice zone will help us to understand the impacts of climate change in the Arctic.

Another key target region for the expedition is northeast Greenland, where the team will investigate the ocean’s influences on marine glaciers. The two glaciers there (79 N Glacier and Zachariae Isstrom) are both characterised by ocean-driven ice loss and accelerated ice flows, making them contributors to sea-level rise.

Kanzow, who’s been pursuing research in the region since 2016, says:

“We plan to install moorings in order to gauge the sensitivity of ocean-driven glacier melting to changing environmental conditions.”

Accompanying geodetic-glaciological studies will be conducted on Greenland. On the one hand, they will assess how the solid ground is rising on extremely small scales, because it is still rebounding from the past weight of ice masses that melted after the last glacial maximum. On the other, they will explore temporal variations in supraglacial lakes; their drainage out to sea can have considerable effects on glacier flow speeds and glacier melting.

For the AWI’s time series dating back to 1997, the expedition team will also deploy measuring devices at the FRAM Observatory between Greenland and Svalbard. And farther to the north in the Arctic Ocean, new instruments will be deployed in the Aurora Vent Field, where they will continually record the seismic activity and physical characteristics of the local heated-water discharges (hydrothermal vents) for the next year. In mid-August, the Polarstern is slated to return to Bremerhaven, from where, following a nearly two-week break, she will depart again, this time bound for the Antarctic.

Source: https://seawanderer.org/polarstern-expedition-to-the-arctic-ice

When demand to transport cargo weakens, short-term rental rates decline for the ships that carry that cargo. When freight demand rises, lease rates rise. You can see this now in spot rates for supertankers moving crude oil from the Middle East and large bulkers moving iron ore to China (weak demand, low rates) and for product carriers moving diesel, gasoline and jet fuel (high demand, high spot rates).

You can’t see it in container shipping, though. At least, not yet.

The container freight market is awash in negative sentiment on import demand, yet short-term ship charter rates remain stratospherically high.

“The charter market is undeterred by the weaker sentiment across the global shipping industry and remains extremely strong,” affirmed data provider Alphaliner on Wednesday. “Charter rates continue to evolve at historic highs with, remarkably, some further gains achieved by certain sizes.” There is “a continued bonanza.”

Operators still hungry for ships

Alphaliner reported that BAL Container Line has just chartered the Northern Prelude (built in 2009, capacity: 4,600 twenty-foot equivalent units) for $160,000 per day for 40-60 days.

It also reported that Sinotrans has chartered the 2021-built, 2,743-TEU X-Press Mekong for $149,000 per day for 40-45 days. “This rate … is not far off the historical high of $175,000 per day [for that size category] obtained in January,” said Alphaliner.

Even the very smallest ships — in the sub-1,000-TEU category — “continue to generate staggering rates.” Ships with capacities of just 700-800 TEUs are being employed at $20,000-$30,000 per day. Most recently, SITC chartered the 2008-built, 724-TEU Atlantic Pioneer for $30,000 per day.

Why the disparity between the charter market and the freight market? Freight rates are off their peaks and still softening, yet they’re still extremely high — high enough for ship operators to generate profits even if they’re still paying sky-high charter rates.

According to Alphaliner, “The continued fall in spot rates on most major routes is obviously a concern, but they remain at historical highs for now, giving both NOOs [non-operating owners, the companies that lease ships to liners] and charterers confidence in short-term market prospects.”

For NOOs, “the short term remains bright.”

And despite medium- and long-term concerns on rising capacity given new ship deliveries in 2023-25, there are still multiyear charters being inked at very strong rates. Alphaliner reported that ocean carrier Zim (NYSE: ZIM) just chartered the 4,520-TEU, 2011-built sister ships Seaspan Chiba and Seaspan Kobe for five years at $43,000 per day.

No collapse in charter rates yet

Data from companies that track charter rates does not indicate a market collapse. On the contrary, it shows a market that’s holding at or near the high point.

Brokerage Harper Peterson & Co. publishes the Harpex index. The index (covering 700- to 8,500-TEU ships) peaked in mid-March, dipped slightly through April, held steady in May and began rising again this month. The Harpex is currently down 3% versus its peak, but still more than double its level at this time last year.

Alphaliner tracks average rates over time, estimating rates for 12-month charter durations. (These figures are assessments only, given the lack of available ships for rent and the rarity of 12-month deals.)

For 8,500-TEU container vessels, it currently assesses rates at $150,000 per day, just below the $155,000-per-day record hit in late March to mid-April. The current rate is up 114% year on year (y/y).

For 5,600-TEU ships, it puts rates at $130,000 per day. That’s the all-time high and up 110% y/y. It assesses 4,000-TEU ships at $110,000 per day, an all-time high and up 93% y/y, and 2,500-TEU ships at $76,000 per day, just below the peak of $80,000 per day in February to early May and up 105% y/y.

Alphaliner puts one-year rates for 1,700-TEU ships at $58,000 per day, near the all-time high of $62,500 per day in late February to mid-May and up 71% y/y. It estimates charter rates for 1,000-TEU container ships at $32,000 per day, down materially — 36% — from a brief high of $50,000 per day reached in early March, albeit still up 68% y/y.

Source: https://www.freightwaves.com/news/container-ships-still-renting-for-160000-a-day-despite-import-fears

Two sailings a week are planned for the Auckland/Tauranga to Lyttelton service and are expected to become operational mid-September this year.

The vessel will add 1,300 TEU extra capacity every week and will complement the existing coastal service provided by Pacifica Shipping’s MV Moana Chief, a 1,700 TEU ship operating since August 2019.

Country Manager for Pacifica Shipping and Swire Shipping New Zealand Brodie Stevens said the service coverage of the new vessel will improve the frequency for the core trade from Auckland/Tauranga to Lyttelton and offer a viable alternative to other transport modes on the inter-island trade.

He pointed out that coverage for the regional ports will also improve to weekly for Nelson and fortnightly for Timaru and Marsden Point. With international shipping lines reducing port calls into regional ports due to supply chain disruptions, the service could vital for regional exporters.

“As New Zealand’s domestic transport is forecast to grow substantially over the next two decades, we are determined to meet that demand by increasing the frequency and capacity of our inter-island domestic freight service, as well as international transshipment cargo demand,” Stevens said.

Stevens referenced Ministry of Transport data projections, showing freight volumes will increase a further 11 per cent in the next 10 years and 40 per cent by 2053.

Most recently, A.P. Moller Maersk announced it is launching a new dedicated New Zealand coastal service.

According to the carrier, the service will enable a more resilient New Zealand supply chain and improve vessel schedule reliability.

Source: https://www.porttechnology.org/news/pacifica-shipping-adds-sailings-to-meet-domestic-freight-demand/

As the shipping industry advances its investment in digital technologies, reaping the benefits of streamlined operations and superior business intelligence, it’s important to focus on the key role Marine Assurance plays in achieving corporate goals.

Marine Assurance underpins maritime safety, regulatory compliance and sustainability by defining the vetting and inspection regime that assesses the risks relating to a vessel’s operations and on compliance…. Therefore, Marine Assurance is a business-critical discipline, and should be considered the unsung hero of marine safety and environmental performance.

While the shipping industry continues a decades’ long improvement in the safety of its assets, the nature and magnitude of the risks it faces do not stand still. Today, digitalisation is revolutionising business processes, voyage planning, as well as the automation, remote monitoring and performance of machinery onboard ships.
The marine industry is now experiencing a shift in responsibilities as it adapts to new regulations and operating methods. As these interacting forces evolve, Marine Assurance systems must continue to progress in sophistication, not only to remain fit-for-purpose, but to constantly raise the bar on performance.

Enhancing the power of digitalisation
This is exactly what’s happening with OCIMF’s SIRE 2.0 tanker inspection regime. It will bring significant, in-depth and timely changes, built largely on advances in digitalisation, and as a result, OCIMF anticipates that the current average number of inspections per vessel per year (about 2.4) will drop due to the higher confidence it will bring.
SIRE 2.0 is an evolution of the original SIRE programme, launched in 1993, aimed at addressing facility, equipment and hardware standards. Next came the Tanker Management Self-assessment (TMSA), launched in 2004 to extend the focus to management systems. SIRE 2.0 now further extends the inspection process to cover the human factor, audit scope and rigour.
By asking more in-depth and insightful questions to encourage more transparency across these new areas, the aim is to reduce incident levels even further. In addition to increased data, photographic evidence will now be available, bringing a previously absent and undeniably visible element to the mix.
Artificial intelligence (AI) will start to become a necessity to enable this information to predict the likelihood of future incidents. However, AI will always require interpretation from experts that know maritime and all of its complexities and nuances.

The sanctions puzzle
The ongoing situation regarding sanctions on Russia is another evolving challenge for the industry. Approximately 1,600 sanctions against Russian entities have been introduced, and that number continues to grow. While the sanctions themselves are black and white, a traditional ‘traffic light system’ is not viable in the current scenario and could make decisions regarding when and how to react to specific sanctions more difficult.
In this climate, it is critical to empower ship owners, operators, charterers and energy companies by providing combined intelligence from multiple high-level data sources and detailed analyses to support their decision-making. And this is where Marine Assurance comes to the forefront, providing not just vetting but also compliance functions.
Automated systems can only do so much to help the maritime industry work through the sanctions. By taking data relating to vessel locations, voyage histories, vessel ownership and operation, as well as cargo and crew manifests, and combining it with human intelligence, MIS Marine is actively advising on the ever-changing scenarios. This includes safety risks around Ukrainian crew onboard vessels, and financial risks around payments for crew members where banking facilities may be restricted.

A common vision requires collaboration
MIS Marine has invested heavily in the development of advanced Marine Assurance solutions and has provided hands-on support to guide customers through change. This includes addressing the twin challenges of replacing outdated legacy systems with more technologically advanced solutions that unlock the power of marine data to support due diligence, whilst avoiding the risk of data overload.
MIS Marine is taking advantage of digitalisation to help shipping continuously improve safety, security, health and environmental performance. We believe that collaboration is key to meeting the challenges and achieving our industry’s common goals.
Source: http://hellenicshippingnews

Sudan and China are celebrating the launch of Sudan-China Express, the first direct maritime shipping route between the two countries.

Noting that Sudan locates in northeastern Africa and on the west coast of the Red Sea, Chinese Ambassador to Sudan Ma Xinmin said the country boasts unique geographical advantages and has served as a key passage for Chinese goods to Africa since ancient times.

The Chinese ambassador added that Sudan and China have great potential and broad prospects of cooperation in shipping.

A 32,000-ton maximum capacity cargo ship disembarked on her maiden voyage along the new route from the Sudan Port on June 11, and is expected to arrive at her destination, the Chinese eastern seaport of Qingdao, on July 1, said Xu Qun, executive president of Shanghai Greenroad International Logistics, the ship’s operato

Source: https://africa.cgtn.com/2022/06/28/sudan-launches-1st-direct-maritime-shipping-route-to-china/

The war in the Ukraine is stifling trade and logistics of the country and the Black Sea region, increasing global vessel demand and the cost of shipping around the world, the UN Conference on Trade and Development (UNCTAD) said. Container shipping and global value chains have been disrupted and many countries have had to look further afield for suppliers of oil, gas and grain.

In a report entitled “Maritime trade disrupted: The war in Ukraine and its effects on maritime trade logistics” published on 28 June 28, UNCTAD said Ukraine’s trading partners now have to turn to other countries for the commodities they import.

It attributes the shipping and transport hurdles in the Black Sea region to disruptions in regional logistics, the halting of port operations in Ukraine, the destruction of important infrastructure, trade restrictions, increased insurance costs and higher fuel prices.

Shipping distances have increased, along with transit times and costs.

“Grains are of particular concern given the leading role of the Russian Federation and Ukraine in agrifood markets, and its nexus to food security and poverty reduction,” the report says.

Soaring shipping costs raise food prices
Fewer grain shipments over longer distances are leading to higher food prices.

Grain prices and shipping costs have been on the rise since 2020, but the war in Ukraine has exacerbated this trend and reversed a temporary decline in shipping prices.

The report says between February and May 2022, the price paid for the transport of dry bulk goods such as grains increased by nearly 60%.

The accompanying increase of grain prices and freight rates would lead to a 3.7% increase in consumer food prices globally.

(Source: UNCTAD)

The Russian Federation is a giant in the global market for fuel and fertilizer, which are key inputs for farmers worldwide.

Disruptions in their supply may lead to lower grain yields and higher prices, with serious consequences for global food security, particularly in vulnerable and food-import-dependent economies.

Higher energy prices exacerbate challenges for shippers
The Russian Federation is also a leading oil and gas exporter.

“Confronted with trade restrictions and logistical challenges, the cost of oil and gas has increased as alternative sources of supply, often at more distant locations, are called upon,” the report said.

Daily rates for smaller-size tankers, which are key for regional oil trading in the Black Sea, Baltic Sea and Mediterranean Sea regions, have dramatically increased.

The higher energy costs have also led to higher marine bunker prices, raising shipping costs for all maritime transport sectors.

According to the report, by the end of May 2022, the global average price for very low sulphur fuel oil had increased by 64% since the start of the year.

Taken altogether, these increased costs imply higher prices for consumers and threaten to widen the poverty gap.

Policy actions needed to keep global trade flowing
UNCTAD calls for urgent action to open Ukraine’s ports to international shipping so the country’s grain can reach overseas markets, at lower shipping costs.

The organization said continued collaboration is needed among vessel flag states, port states and other actors in the shipping industry to maintain all necessary services, including bunkering supplies, health services for sailors and certification of regulatory compliance.

This will help to keep to a minimum the negative impacts on costs, insurance premiums and operations.

UNCTAD also said alternative ways of transport must be pursued and that easing transit and the movement of transport workers – even temporarily – can reduce the pressure on cross-border trade and transit.

Also, UNCTAD calls for more investment in transport services and trade and transit facilitation.

And more international support for developing countries, especially the most vulnerable economies, as the war in Ukraine adds to the challenges posed by the COVID-19 pandemic and the climate crisis.

Source: UNCTAD

In 2021, international liner carriers’ onshore staff and crews managed 6,300 ships, successfully delivering vital supplies worth US$7 trillion to the people of the world, in approximately 241 million containers.

The World Shipping Council (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.

From a liner shipping industry perspective, every container overboard is one too many, and every day carriers work with the other parties in the supply chain to enhance safety. But even with proper packing of the cargo into the container, correct container weight, and proper stowage and securing aboard ship, 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.

Taking action to improve safety

Triggered by these events, 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 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.

John Butler, President & CEO of WSC, says: “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.

“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.”

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 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).

Annual updates for improved data

Correct data plays an important part in the work to enhance container safety. The Containers Lost at Sea Report has until now been updated every three years. However, the unusually high number of incidents in the winter of 2020-21 caused great concern, so WSC has 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.

Source: https://maritimefairtrade.org/world-shipping-council-urges-more-caution-to-prevent-containers-lost-at-sea/