Low Sulphur Fuel Surcharge

From 1st January 2015 new legal requirements will come into force in the Emission Control Areas (ECA) in North Europe (Including the Baltic Sea, North Sea and English Channel) and North America (200 nautical miles from American and Canadian shore). These legal requirements will lower the maximum allowed content of sulphur in fuel
burned in the ECAs to 0.1% sulphur compared to today’s 1.0%. The new regulations are expected to produce a significant positive environmental impact, resulting in sulphur emissions from vessels being reduced by 90% in the ECA areas. Sulphur emissions are responsible for many health issues such as respiratory ailments, and are largely associated with phenomena such as acid rain.

Fuel with a sulphur content of 0.1% is significantly more expensive than fuel with 1.0% sulphur content, thus considerably increasing the operating costs of Carriers and feeder operators.

To offset the additional cost incurred by switching to cleaner fuels in Emission Control Areas, as required by the ECA regulation, Carriers have started to announce their intention to apply a new surcharge – Low Sulphur Fuel Surcharge – effective from 1st January 2015. The surcharge will affect all trades with origins and/or destinations in Emission Control Areas. The LSS surcharge level will be trade-specific and apply to both dry and reefer cargo. The levels are yet to be confirmed by the Carriers, but are expected to be in the region of between $30 and $50 per TEU.