Since the financial crisis in 2008, the shipping industry has been suffering from serious wounds have been slowly healing, the industry needs a day of complete recovery of the shipping industry.However, the weather seems to be bad, the clouds over the shipping industry in waves of dispersal, occasionally out of the clouds into the clouds again.The cloud hanging over the shipping industry this year, apart from the trade war between the United States and China, is the rise in fuel prices.
But recently, the shipping industry seems to be unable to withstand the pressure of rising oil prices - shipping companies continue to impose fuel surcharges, rising sea freight rates slowly caused resistance on the demand side - fuel surcharges or not?
Fuel costs jumped from 8% to 15%
Fuel costs are not negligible for shipping companies, so any fluctuations in the international crude oil market will be passed on to ship fuel prices through a chain reaction.In recent years, with the uncertainty of the international crude oil market, the price of Marine fuel has gradually increased.In 1998, fuel accounted for only 8% of liner companies' operating costs, but now it accounts for 15% or more.That's down from 26 percent in 2011, but 15 percent is still too much for the shipping industry to bear.
Liner companies have been increasing fuel surcharge standards
With oil prices rising and ship operating costs rising, the first quarter results were almost completely reversed in the depressed shipping market.To salvage and make up for the year's results, shipping companies have been forced to ride high, imposing fuel surcharges at a time when demand is already weak.
World shipping giants such as maersk, cma and yangming shipping announced the introduction of fuel surcharges in June. Cma, for example, charges $55 per TEU for dry goods and $85 per TEU for refrigerated goods.That helped reverse losses in the second quarter, but it is still a drag on full-year earnings expectations, prompting some shipping companies to step up and prescribe new fuel surcharges -- maersk recently announced a new fuel surcharge for 2019.
The demand side began to question the rationality of fuel surcharges
however, may be a new fuel surcharge standard shipping company quantity is too fierce, demand side outweighs the - the industry began to appear in view of the rising fuel surcharge standard question sounds, such as some people think the lack of specific details and transparency, customers and the market is hard to calculate and analyze the rationality of this charge, is difficult to determine shipping company increase the rent, or for the purpose of environmental protection.
Maersk responded to such doubts.Maersk believes that, according to initial estimates, more than 90 per cent of its ships will use low-sulphur oil in response to the sulphur restrictions.And the high price of low-sulfur oil will significantly increase the operating costs of liner companies, adding at least $2 billion in additional fuel costs to shipping companies.Therefore, the adjustment of the fuel surcharge standard is mainly to cope with the cost pressure caused by the official implementation of the 2020 sulfur mandate.
Will the fuel surcharge hold up?
The sulfur ban in 2020 will increase the cost of liner companies, and liner companies need to take measures to actively deal with it, which is understandable.But is it necessary for shipping companies to use high-priced, low-sulfur oil and pass on the additional costs to the demand side?To this, the personage inside course of study still has different view.
Some industry analysts have questioned the need for shipping companies to respond to the 2020 ban by installing scrubber towers instead of using high-priced, low-sulphur oil and endlessly upgrading fuel surcharge standards.By installing scrubbers, shipping companies only need to make a one-time capital expenditure, while using high-priced, low-sulfur oil, shipping companies have to bear the additional fuel costs for a long time, and shippers may also face paying low-sulfur fuel surcharges indefinitely.
So if shipping companies can't afford the added cost of using low-sulfur oil in the long run, consider installing desulphurization towers, as the endless changes and fuel surcharges are a test for a fragile and weak market.