Carrier Surcharges for China’s 2019 Low Sulfur Regulation Changes

 In air pollution, carbon emission, carriers, China, container shipping, Container Shipping & Transport, environment, export, global warming, green eco-friendly, import, International Shipping, ocean freight

China’s Ministry of Transport announced a while back upcoming changes to the country’s fuel regulations in regard to sulfur content and emissions. We’re fast approaching the implementation of the first major changes. The changes will come with costs to carriers, so the carriers, of course, plan to pass costs on to shippers through surcharges.

Those surcharges are listed at the end of this article.

Starting in the new year, 2019, China’s emission control areas (ECAs) will include the entire coast of China. Ships sailing within 12 nautical miles of the coastline will be subject to a 0.5% sulfur content limit on fuel. This limit includes when ships are berthing.

NASA Image of Pollution Haze Over China

NASA Image of Pollution Haze Over China

Pollution has long been a problem in China where air quality has often been visible to the naked eye. In fact, the pollution haze has even been visible from space.

That China is showing commitment toward improving air quality is laudable. China’s effort even gets ahead of the International Maritime Organization’s (IMO) sulfur cap regulation changes that are also fast approaching.

The IMO has a 0.5% sulfur cap scheduled to hit the global ocean freight industry in 2020. We recently blogged about literal sail ships being one of the possible solutions for carriers to meet the upcoming regulations.

A 0.5% sulfur cap is pretty good, but it looks like that’s not going to be good enough for China. Starting in 2020, the plan in China is to reduce the sulfur content limit on fuel to 0.1% in the country’s ECAs with talk of increasing the ECAs to something like 20 nautical miles from the coastline instead of 12.

Those 2020 further increased fuel regulations are not set in stone. The country is still determining the feasibility, and it is likely how well implementation of the 2019 regulation changes go will also have an impact on implementation of the IMO-exceeding 2020 regulation plans.

To be clear, the 2019 fuel sulfur regulation change in China is quite significant. The current fuel sulfur cap there is 3.5%. Yes, switching fuels to go from 3.5% sulfur content to 0.5% does cost more money for carriers. So it is no surprise that this regulation would bring with it Low Sulfur Surcharges from carriers.

Of course, the surcharges announced by different carriers vary in amounts and the dates they go into effect.

Steven Chiu of Seamaster Global shared in an email to Universal Cargo a chart including the various Low Sulfur Surcharge amounts he has received announcements on so far. The charts include the surcharge amounts for the various standard shipping container sizes.

Steven also notes that the increase of ECAs coming from China’s Maritime Safety Administration (MSA) expands in the Bohai Sea Area and Pearl River Delta, effective on January 1st, 2019. He adds that the Hong Kong and Taiwan governments also announced the same procedure, aligning with China. This information is reflected in the charts Steven sent, which are broken into two phases.

Phase 1: 

China Low Sulphur Surcharge applied for shipments loaded/transit at Shanghai, Ningbo, Nanjing, and Yangtze River area

Carrier

Effective Date

Loading

Discharge

Surcharge Amount

20’DC

40’DC

40’HC

45’HC

ZIM

1-Nov-18

Shanghai, Ningbo, Nanjing and Yangtze River area

All Routing

USD 20

USD 40

USD 40

USD 40

OOCL

11-Nov-18

Shanghai, Ningbo, Nanjing and Yangtze River area

West Coast

USD 6

USD 8

USD 9

USD 10

OOCL

11-Nov-18

Shanghai, Ningbo, Nanjing and Yangtze River area

Non-West Coast

USD 12

USD 15

USD 17

USD 19

PIL

1-Dec-18

Shanghai, Ningbo, Nanjing and Yangtze River area

All Routing

USD 20

USD 40

USD 40

USD 40

YML

1-Dec-18

Shanghai, Ningbo, Nanjing and Yangtze River area

All Routing

USD 16

USD 32

USD 32

USD 32

HMM

6-Dec-18

Shanghai, Ningbo, Nanjing and Yangtze River area

All Routing

USD 20

USD 40

USD 40

USD 40

Hamburg SUD

12-Dec-18

Shanghai, Ningbo, Nanjing and Yangtze River area

All Routing

USD 10

USD 20

USD 20

USD 20

ONE

1-Jan-19

Shanghai, Ningbo, Nanjing and Yangtze River area

All Routing

USD 15

USD 30

USD 30

USD 30

Phase 2:

Low Sulphur Surcharge applied for shipments export, import, or transit in China, Hong Kong, and Taiwan

Carrier

Effective Date

Loading

Discharge

Surcharge Amount

20’DC

40’DC

40’HC

45’HC

YML

1-Dec-18

Shanghai, Ningbo, Nanjing and Yangtze River area

All Routing

USD 16

USD 32

USD 32

USD 32

YML

1-Jan-19

North China

All Routing

USD 25

USD 50

USD 50

USD 50

YML

1-Jan-19

South China, Pearl River Delta, Hong Kong

All Routing

USD 20

USD 40

USD 40

USD 40

EMC

1-Jan-19

shipment loaded/transship at Taiwan, Hong Kong and China

All Routing

USD 20

USD 40

USD 40

USD 40

HMM

6-Dec-18

China

All Routing

USD 20

USD 40

USD 40

USD 40

ZIM

5-Jan-19

Cargo moving between China and USA/Canada/Panama/the Caribbean.

All Routing

USD 20

USD 40

USD 40

USD 40

APL

1-Jan-19

Cargo moving between China and USA/Canada/Panama/the Caribbean.

All Routing

USD 5

USD 10

USD 10

USD 10

Hamburg SUD

11-Jan-19

China, Taiwan, Hong Kong

All Routing

USD 12

USD 24

USD 24

USD 24

ONE

1-Jan-19

China, Taiwan, Hong Kong

All Routing

USD 15

USD 30

USD 30

USD 30

Maersk

1-Jan-19

Far East (excl. China)

WC North America

USD 26

USD 29

USD 29

USD 37

Maersk

1-Jan-19

Far East (excl. China)

East Coast North America

USD 23

USD 25

USD 25

USD 32

Maersk

1-Jan-19

China

West Coast North America

USD 38

USD 53

USD 53

USD 61

Maersk

1-Jan-19

China

East Coast North America

USD 35

USD 49

USD 49

USD 56

SM Line

1-Jan-19

China (including Hong Kong)   

All Routing

USD 20

USD 40

USD 40

USD 40

 

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Comments
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    Nice blog about China transportation. Everybody should read it to get new updates about China transportation. I like your article thank you!

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