The increase in global freight rates caused by tighter emissions control regulations is putting pressure on steel product exporters already facing reduced demand and falling raw materials and steel prices, Fastmarkets has learned.
From January 1, 2020, new International Maritime Organization (IMO) regulations come into force to help reduce air pollution from ships globally. Known as IMO 2020, the rules insist that ships only use marine fuels with a sulfur content of not more than 0.5% when operating outside Emissions Control Areas (ECAs). The current sulphur content limit is 3.5%. ECAs include the Baltic Sea,the North Sea, the North American ECA (which includes most United States and Canadian coastlines), and the US Caribbean ECA (which includes Puerto Rico and the US Virgin Islands). In these areas, the sulfur content limit for fuel will remain at the 2015 standard of 0.1%."There are several options for how ship owners can meet the new requirements," one international trader said. "They can switch to using very low-sulphur fuel oil or...