Following the introduction of the IMO 2020 sulphur cap on 1 January, the Global Shippers Forum (GSF) has issued a guide for importers and exporters facing demands for surcharges from shipping lines seeking to cover their costs of compliance.
GSF said that its Top Ten Tips for Sulphur-Surcharged Shippers summarises the new rules and also encourages shippers to ‘challenge the basis of any surcharges to make sure they understand exactly what they are being asked to pay extra for, and whether it can be properly explained and justified by carriers’.
James Hookham, GSF’s Secretary General, commented: ‘With the container shipping industry in a trough of depression, the additional burden of complying with tough new rules on emissions from vessels is a necessary but unwelcome start to 2020. The shipping industry has widely assumed that the costs of cleaning up its environmental act can simply be passed onto its Customers (shippers) in the form of surcharges. Whether that will be the case will be the subject of individual negotiations over the coming months. However, shippers should be demanding clear and consistent explanations of any surcharges demanded.’
Hookham went on to argue that, once the IMO 2020 transition period is over, shippers and shipping will have to reach a ‘more mature’ understanding on sharing the cost of environmental responsibility.
‘Ultimately,’ said Hookham, ‘the industry needs to move on to a more mature pricing regime with confidential contracting and all-inclusive charges becoming the “new normal”. The shipping industry needs to wean itself off of surcharges, just as much as it does high-sulphur fuels.’
GSF's top tip number 10 - subtitled 'sulphur surcharges stink!' - expands on this theme: 'This is about the shipping industry cleaning up its environmental act. In any other sector these costs would be absorbed or passed on through normal contract negotiations. If the shipping industry could bring itself to negotiate all-inclusive price and confidential contracts as a norm then surcharges, including for sulphur, can be consigned to history, where they belong.'