EU, US buy Clean Green Ships Made In India

EU, US buy Clean Green Ships Made In India

India has started supplying ‘green ships’ to traditional shipbuilding nations Norway, Germany and the US, boosting its ambition to become a global shipping hub.

The move comes amid an international environmental focus on the shipping industry. While ships are responsible for ferrying the overwhelming majority of goods around the world, they are also responsible for emitting substantial amounts of greenhouse gases.

The issue has become critical since the global energy crisis caused by the Russia-Ukraine war, which has sparked renewed interest in making ’green ships’—vessels that typically run on less polluting fuels such as methanol, electricity, green hydrogen and hybrid batteries.

Recently, state-run Cochin Shipyards Ltd (CSL) delivered two fully electric cargo ferries to Norway. And many more orders are in the pipeline. The development marks a surprise reversal of India’s earlier strategy of looking at sourcing green vessels from Europe and the US. CSL has also bagged contracts for building two vessels from European clients that will be fuelled by methanol.

In addition, the shipyard has signed contracts with Norwegian clients for building two container vessels to be fuelled by green hydrogen. Another contract for supplying eight ‘eco-freighters’ to HS Schiffahrts Group, Germany. marks CSL’s entry into the so-called short-sea shipping market, which consists of ports located in Europe.The private sector too is helping strengthen domestic maritime manufacturing. Goa-based Chowgule and Co has bagged contracts for building eight electric hybrid cargo vessels from European clients.

Shipping minister Sarbananda Sonowal said that more such orders are expected to be placed by European clients with Indian shipyards.

“Most advanced countries are placing orders vessels with Indian companies. This is a clear indication that ‘make in India’ is becoming successful and Atmanirbhar Bharat initiative is getting strengthened," Sonowal said.

Apart from Norway and Germany, Indian shipbuilders are close to striking deals with companies in the US, Netherlands, Denmark and West Asia. Closer to home, contracts are also being looked at from Bangladesh, Sri Lanka and Myanmar. The minister said that Norway and India would cooperate on developing infrastructure for manufacture of green passenger and cargo vessels which would be used for both the domestic and global markets. “Apart from CSL, several Indian ship design and technology firms are also actively working towards delivering green ship solutions. With new initiatives Indian ports will have a globally visible green profile and our shipyards can aspire to be a green tug building hub for the world. With the National Centre of Excellence in Green Ports and Shipping acting as a nodal entity for the industry all such efforts will gain momentum and India can position as a ‘Global hub for building ‘Green Ships’," the minister said.

On its part, the centre is providing funds through the Shipbuilding Financial Assistance Policy (SBFA) to Indian shipyards in order to make India a sought-after destination for technologically advanced green ships.

As per Maritime India Vision – 2030, a clear roadmap has been provided for bringing an all-round improvement, be it in the area of Port modernization and Automation, Coastal Shipping, Shipbuilding, Ship Repair, Transition to Renewable Energy, increasing share of Indian Seafarers across the globe, improving Vessel Turnaround Time, developing Transhipment hubs, Cruise shipping and augmenting capacities at the Major Ports. Focus is also on developing and operationalizing Inland Waterways for improved connectivity and creating an environment for positive modal shift from road and rail to waterways.

Direct main-line container service from Mangalore Port to boost connectivity and exports

Direct main-line container service from Mangalore Port to boost connectivity & exports

A.V. Ramana, chairman, NMPA, inaugurating the first direct mainline service from New Mangalore Port by flagging off the container discharging from the vessel on 13th April 2023.

New Mangalore Port (NMP) has recently commenced its dedicated container terminal, and it has already received its first direct main-line vessel, the MV HONG AN. 

The regular service vessel will operate between the westbound rotation of Chittagong - Colombo - Mangalore - Nhava Sheva - Mundra; and the eastbound leg to Jebel Ali-Khalifa Port. This will be a direct liner service for Indian exporters to Jebel Ali and Abu Dhabi with seamless connections to the USA, Europe, South East Asia, and Africa.

The mainline service got introduced primarily as a result of the use of various productivity measures to free up berth time for new services through the establishment of a fixed window berthing policy and the extension of additional inducements in the form of commercial rebates on vessel-related costs.

The mainline service will be a game changer in how shippers ( from Mangalore, Udupi and hinterland) take their exports to the global markets in the fastest and most efficient ways. It will not only lead to more sea route options, but it can also seamlessly connect cargoes for air transfers from Dubai to destinations in Europe and USA.

The advantages include the transit time which will get reduced to half. The transit time to Jebel Ali earlier was 13-15 days. With direct service, it will get reduced by seven days.

The mainline service will avoid transshipment, which will result in better ocean freight cost for shipments. The new service will also give a major boost to export from Karnataka, particularly agricultural products, the release added. 

Shippers prepare for a barrage of GRI and BAF increases

An end to Rock-bottom freight rates could be in sight, as carriers take advantage of tight capacity management to launch rate restoration programmes across their networks in the next few weeks.  Also, shippers can expect an increase in bunker surcharges, as the shipping lines ramp up BAFs to mitigate the impact of higher fuel costs.

GRI Implementation

The ocean carriers are preparing to implement GRIs this spring, in order to improve freight rates ahead of the peak season, and Hapag-Lloyd has led the charge with a shocking $1,000 per 40ft increase on shipments from Asia to the US from 1 May.

HAPAG’s customer advisory, published on 31 March has taken the industry by surprise, given the parlous state of a tradelane still suffering from chronically inflated retail inventories.

In fact, to mitigate the weak demand, carriers are planning to blank up to 50 headhaul sailings from Asia to the US east and west coasts this month.

Container spot rates between Asia and the US west coast have collapsed, from over $20,000 per 40ft in mid-2021 to just $1,000 and carriers desperately need to raise short-term rates in an effort to boost stalled annual contract negotiations.

Hapag has used these ‘shock and awe’ tactics before and the important thing is that, despite the weak market fundamentals, they can get BCOs thinking again about sustainable pricing.

It remains to be seen however, whether Hapag-Lloyd or its peers will look to announce similar GRIs on other routes, including the key Asia-North Europe tradelane.

Slight increase in Spot rates

Recent reports to The Loadstar suggest that in the past few weeks carriers have mostly succeeded in matching supply with demand on the transpacific and Asia-Europe, with export sailings last week said to be “close to capacity”.

And spot rates are seeing a slight uptick as a consequence.

“Vessel space is lacking at the moment; we are seeing vessels full until the third week of April, so there are chances that carriers will try to push for further rate increases for April voyages,” a logistics source told Platts Container Freight Weekly Commentary.

Meanwhile, a big spike in oil prices, following the OPEC + coalition of oil-producing countries’ surprise decision on Sunday to cut output, could result in a fresh raft of bunker surcharges for shippers.

The price of Brent Crude jumped by around $10 yesterday to $82 per barrel, exerting pressure on the bunker supply market, which in turn saw the cost of Rotterdam-sourced compliant low-sulphur fuel increase $25 today, to $595 per tonne.

Bunker prices are likely to remain higher in the coming weeks, which will trigger carrier BAF increases.

Malabar Service Maiden Call @ ICTT Cochin : Enhances Connectivity between India & the Middle East

DP World, a global provider of end-to-end logistics, has hosted the newly launched weekly Malabar Service at its modern International Container Trans-shipment Terminal (ICTT) in Kochi. Operated by Mediterranean Shipping Company (MSC), the new service will have four vessels of 2400 TEU capacity.

QUICK FACTS

The new service will provide direct and seamless connectivity between Kochi, Mundra, Karachi, Jebel Ali, Abu Dhabi, Kuwait (with Shuwaikh Port), Qatar (with Hamad Port)

The new service will be operated by Mediterranean Shipping Company (MSC) and is vital in enhancing South India’s connectivity to the Middle East

Malabar service will have 4 vessels of 2400 TEU capacity

DP World, a leading global provider of smart end-to-end logistics, welcomed the newly launched weekly Malabar Service, at its state-of-the-art International Container Trans-shipment Terminal (ICTT) Cochin. The new service will be operated by Mediterranean Shipping Company (MSC) and will have 4 vessels of 2400 TEU capacity.

“Malabar” service’s maiden vessel, M.V. MSC Krittika, reached DP World’s terminal in Cochin on 6th April 2023. The new service will provide direct and seamless connectivity between Cochin, Mundra, Karachi, Jebel Ali, Abu Dhabi, Kuwait (with Shuwaikh Port), Qatar (with Hamad Port) and Sri Lanka (Colombo). 

“Malabar” service will create a faster, stable, and reliable service for the traders across the India-Middle East corridor and leverage the strong partnerships between the two regions for boosting economic growth.

The newly launched Malabar service by MSC, will play an integral role in strengthening the bilateral trade between India and the Middle East countries. In addition, this service will enable Indian exporters have a deeper and wider access to the markets in the Middle East region. 

The Malabar Service will be the 3rd weekly service sailing for the Middle East region from DP World Cochin. The port terminal is capable of handling post panamax ships and in February 2023, the 605-metre-long terminal reached a monumental milestone of successfully handling 6 million TEUs since its inception in 2011.