What We're Reading: BDP Trendwatch Week 3

COSCO container ship at port on hazy day with dark shadows

Brexit vote paves way for Jan. 31 exit, future of EU trade remains uncertain

Despite the bill's expected passage, supply chains in the region face continued uncertainty as the future of the U.K.'s relationship with the EU remains in doubt. If the parties don't reach a deal by the end of the year, the U.K. will lose its privileged access to the EU market and must renegotiate hundreds of existing trade agreements with member states.

Expectations of key port slowdowns, customs barriers and prolonged intermodal transfers have the food, healthcare and manufacturing sectors particularly concerned that stockpiling resources won't be enough to ride out a no-deal scenario. Auto manufacturers from BMW to Toyota are considering shifting their U.K. supply chains into the EU to be safe, though BMW called it a "worst case scenario."

Source: Supply Chain Dive


Better education on cargo declarations needed to prevent more containership fires

After the first boxship fire of the year was deemed to have been caused by misdeclared lithium batteries, forwarders have warned that shippers need to be better educated about cargo declarations, or face increased regulation.

According to Chinese shipping line Cosco, the fire onboard its 10,000 teu Cosco Pacific this month was caused by lithium batteries falsely declared as spare parts.

Source: The Loadstar

 

Panama Canal cuts down slots for ships due to droughts

The Panama Canal will cut its daily slot reservations due to droughts and impose a "freshwater" charge on ships to maintain the thoroughfare's levels, the authorities said on Monday, tightening access to one of the world's most important trading routes.

Canal administrator Ricaurte Vasquez told a news conference that from Feb 15, a fixed charge would be set at US$10,000 for any vessel over 38m long, as well as a variable surcharge based on the level of Gatun Lake at time of transit.

Source: The Business Times

 

Suez Canal greenlights ships using HFO and bans use of open-loop scrubbers

Despite the recent introduction of  low-sulphur regulations, the Suez Canal Authority (SCA) will continue to allow ships transiting the waterway to burn heavy fuel oil (HFO) without the need for scrubbers.

Adding to the confusion for ship managers is a ban by the SCA on the discharge of wash water – used in the open-loop scrubber process – while vessels make the passage.

Source: The Loadstar

 

U.S. crude oil production to reach record high in 2020

The U.S. Energy Information Administration (EIA) has released its January 2020 Short-Term Energy Outlook, with Administrator Dr. Linda Capuano saying that both global oil supply and consumption are expected to grow in 2020, with supply from non-OPEC producers, particularly the U.S., Norway, Brazil, and Canada, more than offsetting declining production from OPEC.

The EIA forecasts that U.S. crude oil production will reach new records in 2020 and 2021. Driven primarily by higher production in the Permian region of Texas and New Mexico, the outlook forecasts an average of 13.3 million barrels per day of U.S. crude oil production in 2020 and 13.7 million barrels per day in 2021.

Source: The Maritime Executive

 

Singapore December bunker sales rebound on IMO rules, despite annual drop: MPA

Salesof marine fuels, also known as bunkers, in Singapore hit a four-year low in 2019, but soared in the last month of the year as vessels globally switched to cleaner fuels to meet new emission rules this year, official data showed.

In 2019, bunker sales in Singapore fell 5 per cent to 47.5 million tonnes, data from the Maritime and Port Authority of Singapore (MPA) showed, as regional competition increased, while ships scaling back purchases of high-sulphur fuel towards the year-end also weighed.

Source: The Business Times