MSC Prepares for IMO 2020 Challenge

 03 Dec 2018 04.02pm

MSC Mediterranean Shipping Company, the second largest shipping company in the world, has reiterated its decision to introduce new bunker surcharges as of January 2019.

According to a statement, the new charges will help MSC to achieve the common goal of improving environmental performance in the container shipping supply chain, as required by the International Maritime Organization’s (IMO) 2020 sulphur regulations.

The company has underlined that it is “essential to segregate transparently the burden of fuel costs, in order for this cost to be passed on visibly throughout the supply chain”.

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MSC has estimated that the cost of changes to its fleet, as a result of the IMO’s 2020 fuel content regime, will amount to over US$2 billion per year, some of which the carrier has already incurred in preparation for 2020.

Following an analysis of operating costs and related market factors, MSC has established the Bunker Recovery Charge (BRC) price mechanism, which will be transparent to respective trade.

 

 

The BRC reflects the additional cost incurred by MSC because of the regulatory changes it is supporting in order to protect the environment.

This price mechanism replaces the current Bunker Contribution (BUC), Fuel Adjustment Factor (FAD) and Emergency Fuel Surcharge (EFS), as well as absorbing all other pre-existing fuel-related charges.

Charges specifically related to coastal Emission Control Areas (ECAs) will remain in place.

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