ECA in the Mediterranean
The Mediterranean Sea (including the Adriatic and Aegean Seas) will be designated an Emission Control Area (ECA) from May 1st, 2025. This means that any ship operating there will be required to use fuel with a sulphur limit of 0,1%, as opposed to the standard 0,5%. This type of fuel has been more expensive than (V)LSFO (0,5%) in the past. The question remains whether shippers will be expected to absorb these extra costs or if carriers will invest the surpluses they generated over last few years.
Demand vs carrier capacity
Year-to-date decline of global shipped volumes is now standing at 3.7% compared with 2021. Due to the low demand, many ships’ voyages were blanked, however this a fine balancing position given the decline in rates.
China eases Covid rules at ports
Ships calling at Chinese ports are no longer required to provide 48-hour COVID test results for crew before arrival. Beside this, Erenhot, the largest land port on the China-Mongolia border and an important gateway for Europe-bound freight trains, removed all curbs on cross-border rail operations. The easing of COVID rules in China will improve the supply chain situation in the mid and long run, allowing goods to move smoothly without further delays. Due to an increasing number of post-lockdown infections in China, short term disruptions may occur over the next couple of weeks, as factories and logistics services are facing higher than normal numbers of illness.