<div class="phx-topic abstract-wrapper">Shippers in Southeast Asia and their customers in Japan and North America will get more and faster a</div>

Shippers in Southeast Asia and their customers in Japan and North America will get more and faster a

<div>Shippers in Southeast Asia and their customers in Japan and North America will get more and faster avenues of delivery with a regional expansion of services by Federal Express Corp.The carrier is also set to begin service from southern China in October and will offer the first direct access to Japan from Taiwan.While acknowledging that currency fluctuations in the region may continue for a time, ''much of what we carry is high-value shipments produced by overseas companies exporting to global markets. Asia continues to be a strong base for offshore manufacturers,'' said Mike Ducker, Asia-Pacific president of FedEx.A service inaugurated...

Shippers in Southeast Asia and their customers in Japan and North America will get more and faster avenues of delivery with a regional expansion of services by Federal Express Corp. The carrier is also set to begin service from southern China in October and will offer the first direct access to Japan from Taiwan.While acknowledging that currency fluctuations in the region may continue for a time, ''much of what we carry is high-value shipments produced by overseas companies exporting to global markets. Asia continues to be a strong base for offshore manufacturers,'' said Mike Ducker, Asia-Pacific president of FedEx. A service inaugurated Friday from the regional hub at Subic Bay north of Manila links Cebu in the center of the Philippines with Jakarta and Singapore. An Airbus Industrie A-310 makes the run five times a week. ''This is good for Cebu, a strong industrial area, but even better for Jakarta,'' said David Clarke, FedEx regional spokesman. ''It is our first own aircraft into Indonesia and gives us greater control than using commercial partners. ''It also gets into Singapore before the nightly departure from there of our SuperX service to Japan and Memphis, meaning goods can be delivered in the United States next day. ''This is unheard of for Southeast Asia. No one else is doing that,'' Mr. Clarke said Friday. ''The service also benefits Japanese companies, which have a lot of investment in Southeast Asian manufacturing.'' SuperX, which was introduced last July, uses a converted MD-11 from Singapore on what FedEx says is the world's longest single flight - from Osaka direct to Memphis. Subic, the former U.S. naval base, is the hub for Asia One, with 14 ''spokes'' covering all main business centers in the Asia-Pacific. The daily Subic-U.S. flight goes with the full 50-ton capacity. FedEx, a unit of FDX Corp. of Memphis, is also looking to beef up its services from the booming southern region of China. The flight from Shenzhen, a special economic zone adjacent to Hong Kong, will go via Shanghai to Anchorage. Hong Kong also gets a boost, with a third aircraft joining the roster. The Airbus A-310 joins a sister plane on the Hong Kong-Subic run and an MD-11 from the McDonnell Douglas unit of Boeing Co., operating Hong Kong-Anchorage. From August, the additional flight will run from Hong Kong via Taipei and Osaka in Japan to Oakland, Calif. Cutoff times were adjusted in both Hong Kong and Taipei to allow late-night departures. That route allows next-day delivery on the U.S. West Coast because the flight in effect arrives before it leaves, thanks to the international dateline, landing at just before midnight Pacific time. ''Does all this mean we are expecting new business? We've already got it. The sales department was screaming for more capacity,'' Mr. Clarke said. In the case of southern China, about 80 percent of manufacturing output from Guangdong province is shipped abroad from neighboring Hong Kong. ''The Shenzhen service means shippers won't have to truck things down to Hong Kong and allows us to balance our workload a bit better in Hong Kong,'' Mr. Clarke said. Outbound, the calls will be Subic-Shenzhen-Shanghai-Anchorage with four frequencies a week. Coming back, the route is Anchorage-Beijing-Shanghai-Subic, also four times a week. An existing service links Anchorage with Subic via Tokyo's Narita Airport, Beijing and Shanghai. FedEx isn't allowed to do internal distribution within China, so relies on partners there. Mr. Ducker said the company has no immediate plans to expand into central China, though he said it is an area that has capacity for growth in manufacturing. Chinese officials are striving to spread economic growth into the interior from the booming coastal areas.

FEDEX REVAMP IN ASIA SPEEDS ITS SERVICE TO NORTH AMERICA

<div class="phx-topic abstract-wrapper">Forwarders say reefer-centric Indian grape exports combined with sporadic vessel schedule disruptions have enabled carriers to adjust rates upward on the trade lane.</div>

Forwarders say reefer-centric Indian grape exports combined with sporadic vessel schedule disruptions have enabled carriers to adjust rates upward on the trade lane.

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<div class="phx-topic">Major container lines operating on the India-Europe/Mediterranean trades have pushed spot rates for February sailings noticeably higher while signaling that further increases are in the cards for March. Carrier spot rate asks are up by $400 to $500 per TEU/FEU from January, according to forwarder sources. Average spot pricing from Nhava Sheva/Mundra (West India) to Felixstowe/London Gateway/Rotterdam now stands at $1,300 to $1,400 per dry standard container, up from $800 to $900 a month ago. Sources reported similar spot gains for Indian loads to the Mediterranean, with February quotes hovering at $1,400 to $1,500 per TEU/FEU for Genoa (Italy) bookings and $2,000 to $2,200 per TEU/FEU for Egypt’s Port Said. Forwarders believe that seasonal reefer-centric Indian grape export bookings combined with sporadic vessel schedule disruptions have enabled carriers to adjust rates upward on the India–Europe trade lane. “Even some of the typically cargo-hungry Asian carriers have lifted spot rates as their slot allocations from network-leading capacity partners dropped,” a Mumbai-based forwarder executive who didn’t want to be identified told the Journal of Commerce. But lead carriers have chosen to hold quarterly contract rates firm because they seem to consider spot gains a temporary or seasonal blip and not a market shift, sources explained. Overall grape volumes in the current season will likely be lower than the historical pattern due to weaker harvest conditions. Available forward vessel schedules point to a few blankings across West India-North Europe networks in March, so forwarders expect tighter capacity to work in favor of the carriers in the spot market in the coming weeks. “Some space crunch is imminent for Europe,” said another executive at a niche reefer forwarder company. “Over the next six to eight weeks, close to 6,000 boxes of grapes have to be exported.” Contact Bency Mathew at <a href="mailto:bencyvmathew@gmail.com">bencyvmathew@gmail.com</a>. </div>

Major container lines operating on the India-Europe/Mediterranean trades have pushed spot rates for February sailings noticeably higher while signaling that further increases are in the cards for March. Carrier spot rate asks are up by $400 to $500 per TEU/FEU from January, according to forwarder sources. Average spot pricing from Nhava Sheva/Mundra (West India) to Felixstowe/London Gateway/Rotterdam now stands at $1,300 to $1,400 per dry standard container, up from $800 to $900 a month ago. Sources reported similar spot gains for Indian loads to the Mediterranean, with February quotes hovering at $1,400 to $1,500 per TEU/FEU for Genoa (Italy) bookings and $2,000 to $2,200 per TEU/FEU for Egypt’s Port Said. Forwarders believe that seasonal reefer-centric Indian grape export bookings combined with sporadic vessel schedule disruptions have enabled carriers to adjust rates upward on the India–Europe trade lane. “Even some of the typically cargo-hungry Asian carriers have lifted spot rates as their slot allocations from network-leading capacity partners dropped,” a Mumbai-based forwarder executive who didn’t want to be identified told the Journal of Commerce. But lead carriers have chosen to hold quarterly contract rates firm because they seem to consider spot gains a temporary or seasonal blip and not a market shift, sources explained. Overall grape volumes in the current season will likely be lower than the historical pattern due to weaker harvest conditions. Available forward vessel schedules point to a few blankings across West India-North Europe networks in March, so forwarders expect tighter capacity to work in favor of the carriers in the spot market in the coming weeks. “Some space crunch is imminent for Europe,” said another executive at a niche reefer forwarder company. “Over the next six to eight weeks, close to 6,000 boxes of grapes have to be exported.” Contact Bency Mathew at bencyvmathew@gmail.com .

Asia-Europe

Container Shipping News

Maritime

India-Europe spot rates climb on seasonal booking demand, tighter capacity

<div class="phx-topic abstract-wrapper">A number of forwarders and software vendors are providing products, often for free, to help shippers and customs brokers calculate refunds they may have coming following Friday’s Supreme Court ruling. </div>

A number of forwarders and software vendors are providing products, often for free, to help shippers and customs brokers calculate refunds they may have coming following Friday’s Supreme Court ruling.

<div class="phx-topic">A range of software tools has emerged over the past few months that should help importers and customs brokers determine the level of refunds available to them as a result of Friday’s Supreme Court ruling rejecting the mechanism used by the Trump administration to collect tariffs over the past 10 months. The decision, which ruled the administration improperly assessed an estimated $175 billion in tariffs on importers by using the International Emergency Economic Powers Act (IEEPA), has set in motion a scramble to claw back refunds on those tariffs. But the process is far from clear. The Court made no determination on how the refund process should be handled and President Donald Trump suggested on Friday after the ruling that refunds might be tied up in legal disputes for two or more years. Trade experts have said the US Court of International Trade (CIT) will ultimately decide the refund process. While importers await word from the government about the process, or until a case is brought before the CIT that might provide clarity, most will be turning to an administrative filing called a post-summary correction (PSC) to get in line to claim their refund. A PSC is an electronic tool within the government’s Automated Commercial Environment (ACE) that allows importers to fix errors in their customs entries and claim refunds for any duty improperly collected. To calculate what those refunds might amount to, software vendors and forwarders have established products for customs brokers and importers to use. Digital forwarder Flexport, well-versed in marketing its services to shippers in trying times, has been front and center on the tariff issue by promoting its free-to-use tariff refund calculator. It has added an IEEPA tariff refund product that calculates the refund amount and starts the process for claiming refunds. <h3>Multiple tools available </h3>Flexport is far from the only refund tool on the market. Wove, an automation technology provider for forwarders, customs brokers and shippers, launched an IEEPA tariff refund calculator over the weekend that allows users to upload a spreadsheet into a web portal with the harmonized tariff schedule (HTS) code, country of origin, customs value and entry date information to determine their refunds. Amari AI, which last week landed a $4.5 million seed funding round from venture investors, also has a tariff calculator based on HTS code and shipment details. That’s aside from its core product, which automates the extraction of information from commercial invoices, packing lists, bills of lading and arrival notices to help customs brokers file entries more efficiently. Reform, yet another provider catering to customs brokers and importers, this week said a post-summary correction audit and filing tool that helps determine in minutes whether an entry error has occurred has seen demand increase significantly since the Supreme Court decision. “Brokers simply import their 7501 entry summaries and supporting commercial invoices, and the tool delivers results in a matter of minutes,” Reform said in a blog Tuesday. Reform said brokers can receive a corrected entry formatted for transmission to CBP through systems such as Descartes NetCHB or CargoWise or a detailed spreadsheet flagging missing HTS codes, provisional tariffs, and discrepancies between entries and invoices. Reform said the issue is particularly acute for importers and the customs brokers they use because CBP is itself using artificial intelligence and automation to better target incorrect entries. Pallet, another logistics automation specialist, said it has enabled forwarder Mallory Alexander to double the number of import filings its employees can handle while increasing the accuracy of those filings from about 80% to 97%. In addition, importers are turning to tax and trade compliance advisory specialists to ensure that the paperwork they need to apply for refunds is in order. All this comes as the Trump administration, seeking to pivot after the Court ruling, implemented on Monday a 10% tariff on all trade partners using so-called Section 122 authority. But there are myriad exemptions for specific products or countries covered by existing trade agreements, as well as legal questions about whether the market factors that would justify using Section 122 powers are even in place. Contact Eric Johnson at <a href="mailto:eric.johnson@spglobal.com">eric.johnson@spglobal.com</a>. </div>

A range of software tools has emerged over the past few months that should help importers and customs brokers determine the level of refunds available to them as a result of Friday’s Supreme Court ruling rejecting the mechanism used by the Trump administration to collect tariffs over the past 10 months. The decision, which ruled the administration improperly assessed an estimated $175 billion in tariffs on importers by using the International Emergency Economic Powers Act (IEEPA), has set in motion a scramble to claw back refunds on those tariffs. But the process is far from clear. The Court made no determination on how the refund process should be handled and President Donald Trump suggested on Friday after the ruling that refunds might be tied up in legal disputes for two or more years. Trade experts have said the US Court of International Trade (CIT) will ultimately decide the refund process. While importers await word from the government about the process, or until a case is brought before the CIT that might provide clarity, most will be turning to an administrative filing called a post-summary correction (PSC) to get in line to claim their refund. A PSC is an electronic tool within the government’s Automated Commercial Environment (ACE) that allows importers to fix errors in their customs entries and claim refunds for any duty improperly collected. To calculate what those refunds might amount to, software vendors and forwarders have established products for customs brokers and importers to use. Digital forwarder Flexport, well-versed in marketing its services to shippers in trying times, has been front and center on the tariff issue by promoting its free-to-use tariff refund calculator. It has added an IEEPA tariff refund product that calculates the refund amount and starts the process for claiming refunds. Multiple tools available Flexport is far from the only refund tool on the market. Wove, an automation technology provider for forwarders, customs brokers and shippers, launched an IEEPA tariff refund calculator over the weekend that allows users to upload a spreadsheet into a web portal with the harmonized tariff schedule (HTS) code, country of origin, customs value and entry date information to determine their refunds. Amari AI, which last week landed a $4.5 million seed funding round from venture investors, also has a tariff calculator based on HTS code and shipment details. That’s aside from its core product, which automates the extraction of information from commercial invoices, packing lists, bills of lading and arrival notices to help customs brokers file entries more efficiently. Reform, yet another provider catering to customs brokers and importers, this week said a post-summary correction audit and filing tool that helps determine in minutes whether an entry error has occurred has seen demand increase significantly since the Supreme Court decision. “Brokers simply import their 7501 entry summaries and supporting commercial invoices, and the tool delivers results in a matter of minutes,” Reform said in a blog Tuesday. Reform said brokers can receive a corrected entry formatted for transmission to CBP through systems such as Descartes NetCHB or CargoWise or a detailed spreadsheet flagging missing HTS codes, provisional tariffs, and discrepancies between entries and invoices. Reform said the issue is particularly acute for importers and the customs brokers they use because CBP is itself using artificial intelligence and automation to better target incorrect entries. Pallet, another logistics automation specialist, said it has enabled forwarder Mallory Alexander to double the number of import filings its employees can handle while increasing the accuracy of those filings from about 80% to 97%. In addition, importers are turning to tax and trade compliance advisory specialists to ensure that the paperwork they need to apply for refunds is in order. All this comes as the Trump administration, seeking to pivot after the Court ruling, implemented on Monday a 10% tariff on all trade partners using so-called Section 122 authority. But there are myriad exemptions for specific products or countries covered by existing trade agreements, as well as legal questions about whether the market factors that would justify using Section 122 powers are even in place. Contact Eric Johnson at eric.johnson@spglobal.com .

Logistics Technology News

Forwarding

Transport, Trade and Regulation News

IEEPA tariff decision prompts flood of correction tools for refunds, customs entries

<div class="phx-topic abstract-wrapper">The forwarder has contracted a total of 18,000 metric tons of CO₂ equivalent emission reductions on a well-to-wake basis that will be derived through the carrier’s Ship Green product.</div>

The forwarder has contracted a total of 18,000 metric tons of CO₂ equivalent emission reductions on a well-to-wake basis that will be derived through the carrier’s Ship Green product.

<div class="phx-topic">Hapag-Lloyd and forwarder DSV have extended their sustainable biofuels partnership for two years with an agreement signed Tuesday that increases the pool of alternative fuels that can be used across the carrier’s fleet. In addition to second-generation biofuels, the agreement now allows for the inclusion of other sustainable fuel sources, Hapag-Lloyd and DSV said in a joint statement. Under the new agreement, DSV has contracted a total of 18,000 metric tons of CO₂ equivalent emission reductions on a well-to-wake basis that will be derived through Hapag-Lloyd’s Ship Green product. “Sustainable marine fuels are a tangible and scalable solution to reducing CO₂ emissions, and through close collaboration with Hapag-Lloyd, we are enabling our customers to decarbonize their supply chains," Michael Hollstein, head of ocean product at DSV, said in the statement. Danny Smolders, Hapag-Lloyd’s managing director of global sales, said both companies shared a clear ambition to accelerate the decarbonization of global supply chains. “By working closely together, we can turn this ambition into action,” Smolders said. “This agreement demonstrates how carriers and forwarders can jointly drive meaningful progress and scale lower-emission shipping solutions.” Hapag-Lloyd aims to achieve net-zero fleet operations by 2045, while DSV has committed to reaching net-zero emissions across its own operations and value chain by 2050. Offering sustainable logistics solutions to customers was a key lever toward achieving those goals. The agreement is based on a book-and-claim chain-of-custody mechanism that allows customers to claim verified emission reductions, regardless of the physical fuel allocation to specific vessels or routes. Only emissions avoidance from biofuel that has already been used in Hapag-Lloyd’s owned and operated fleet is allocated to DSV. The model enables shippers to comply with emissions-reduction regulations, such as the European Union Emissions Trading System, while sustainable marine fuels remain limited in availability. Biofuels currently represent the most available and scalable option in sea freight, although the volume used across the Hapag-Lloyd fleet remains in the low single-digit percentages, according to a spokesperson for the carrier. <h3>Regulatory safeguards needed </h3>While biofuel usage increases across the fleets of several carriers, climate campaigner Environmental Defense Fund (EDF) has expressed concern over the absence of regulatory safeguards and careful management of the full value chain impacts. The EDF noted in a recent report that the popularity of biofuels was rising as a fast-track option for the transition to low-carbon shipping, raising fears that land use may be converted from food production to instead produce feedstock for biofuels. The components of direct or indirect land use have not yet been clearly defined as the International Maritime Organization is still developing methodological guidance on how to incorporate them. “How the IMO defines these terms and sets up safeguards will determine whether an increase in demand for certain biofuels results in deforestation, loss of wetlands, displaced communities and food insecurity,” the EDF report stated. The Hapag-Lloyd spokesperson told the Journal of Commerce the carrier supports the development of a global framework that regulates the sustainable criteria for alternative fuels worldwide. “What matters now is maintaining ambition and reaching agreement on a framework that combines environmental integrity, robust sustainability criteria and practical feasibility,” the spokesperson said. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Hapag-Lloyd and forwarder DSV have extended their sustainable biofuels partnership for two years with an agreement signed Tuesday that increases the pool of alternative fuels that can be used across the carrier’s fleet. In addition to second-generation biofuels, the agreement now allows for the inclusion of other sustainable fuel sources, Hapag-Lloyd and DSV said in a joint statement. Under the new agreement, DSV has contracted a total of 18,000 metric tons of CO₂ equivalent emission reductions on a well-to-wake basis that will be derived through Hapag-Lloyd’s Ship Green product. “Sustainable marine fuels are a tangible and scalable solution to reducing CO₂ emissions, and through close collaboration with Hapag-Lloyd, we are enabling our customers to decarbonize their supply chains," Michael Hollstein, head of ocean product at DSV, said in the statement. Danny Smolders, Hapag-Lloyd’s managing director of global sales, said both companies shared a clear ambition to accelerate the decarbonization of global supply chains. “By working closely together, we can turn this ambition into action,” Smolders said. “This agreement demonstrates how carriers and forwarders can jointly drive meaningful progress and scale lower-emission shipping solutions.” Hapag-Lloyd aims to achieve net-zero fleet operations by 2045, while DSV has committed to reaching net-zero emissions across its own operations and value chain by 2050. Offering sustainable logistics solutions to customers was a key lever toward achieving those goals. The agreement is based on a book-and-claim chain-of-custody mechanism that allows customers to claim verified emission reductions, regardless of the physical fuel allocation to specific vessels or routes. Only emissions avoidance from biofuel that has already been used in Hapag-Lloyd’s owned and operated fleet is allocated to DSV. The model enables shippers to comply with emissions-reduction regulations, such as the European Union Emissions Trading System, while sustainable marine fuels remain limited in availability. Biofuels currently represent the most available and scalable option in sea freight, although the volume used across the Hapag-Lloyd fleet remains in the low single-digit percentages, according to a spokesperson for the carrier. Regulatory safeguards needed While biofuel usage increases across the fleets of several carriers, climate campaigner Environmental Defense Fund (EDF) has expressed concern over the absence of regulatory safeguards and careful management of the full value chain impacts. The EDF noted in a recent report that the popularity of biofuels was rising as a fast-track option for the transition to low-carbon shipping, raising fears that land use may be converted from food production to instead produce feedstock for biofuels. The components of direct or indirect land use have not yet been clearly defined as the International Maritime Organization is still developing methodological guidance on how to incorporate them. “How the IMO defines these terms and sets up safeguards will determine whether an increase in demand for certain biofuels results in deforestation, loss of wetlands, displaced communities and food insecurity,” the EDF report stated. The Hapag-Lloyd spokesperson told the Journal of Commerce the carrier supports the development of a global framework that regulates the sustainable criteria for alternative fuels worldwide. “What matters now is maintaining ambition and reaching agreement on a framework that combines environmental integrity, robust sustainability criteria and practical feasibility,” the spokesperson said. Contact Greg Knowler at greg.knowler@spglobal.com .

Container lines

Hapag-Lloyd inks new sustainable biofuel deal with DSV

<div class="phx-topic abstract-wrapper">Whatever measure is ultimately agreed to by member states, decarbonization experts agree the IMO’s revised emissions reduction targets set in 2023 will need to be pushed back.</div>

Whatever measure is ultimately agreed to by member states, decarbonization experts agree the IMO’s revised emissions reduction targets set in 2023 will need to be pushed back.

<div class="phx-topic">Decarbonization experts are running through different scenarios that will enable the International Maritime Organization’s delayed net-zero emissions framework to be formally adopted in November. A best-case scenario will see the IMO framework, <a href="https://www.joc.com/article/imo-punts-on-pivotal-net-zero-shipping-regulation-6099141">postponed for a year at a meeting last October</a>, entering into force in 2028, a year later than planned, and coming into effect in 2029. But a prolonged political deadlock could delay regulatory certainty on greenhouse gas (GHG) reductions for several years. The Global Maritime Forum and maritime classification society DNV looked separately at the different scenarios for net-zero implementation. And while the views of their decarbonization experts differed, there was consensus that whatever measure is ultimately agreed to this November, the IMO’s revised emissions reduction targets set in 2023 will need to be pushed back. A new report from the Global Maritime Forum was released this week and looked at the different plausible outcomes for the net-zero framework (NZF). “Uncertainty at the IMO: Three scenarios and their consequences for shipping’s transition,” was co-authored by Tristan Smith, associate professor at the UCL Energy Institute, and Femke Spiegelenberg, project manager of the Getting to Zero Coalition within the Global Maritime Forum. Three potential scenarios were covered by the report: adopting the NZF unchanged from the measures voted down last October, adopting a single-tier fuel standard with lower compliance costs, and removing the economic elements altogether. The report noted that each scenario would have materially different impacts on timelines, enforcement, investment signals, revenues, low-income countries, and regional policies. “At a minimum, the implementation dates in the text will need to be adjusted to reflect the postponed adoption,” the report said. “More fundamentally, the political dynamics that led to the NZF delay introduced new uncertainty not just about the timeline but also about the final shape and ambition of the framework. “At one extreme, the NZF could be adopted ‘as is’ later this year, entering into force in 2028 and coming into effect in 2029,” the report added. “At the other extreme, a prolonged political deadlock could delay regulatory certainty on GHG reductions for several years.” <h3>A battle to build consensus </h3>The motion to delay adoption of the IMO’s net-zero framework last October was made at a tense and combative session of its Marine Environment Protection Committee (MEPC) in London. Despite 80% approval for the NZF from member states voting last April, 34 countries switched positions between April and October to favor the deferment in the face of growing pressure from the US. The vote to delay was 57 in favor and 49 against, with 21 abstentions. Achieving the IMO target of full decarbonization by or around 2050 with benchmark targets set along the way will require narrowing the wide price gap that exists between fossil fuels and the low- or zero-emission alternatives, which by its very nature will require making fossil fuels more expensive. But the US believes putting a price on carbon emissions from ships will be passed on to its consumers, increasing costs by 10%. That position, centered around President Donald Trump’s view that a price on carbon emissions was a “global green new scam tax on shipping,” triggered extraordinary threats by the White House that included sanctions, port fees and visa refusals against member states voting to adopt the IMO net-zero framework. The IMO is now focused on building consensus around some version of the NZF this year before a reconvened MEPC meets in November to finalize the legally binding measures. With the US so fundamentally opposed to any economic measure that penalizes carbon emissions, one of the potential scenarios being suggested by some member states was to remove it completely from the NZF and focus instead on a technical measure. The Global Maritime Forum report warned that any removal of the economic element that is designed to make green technologies cheaper than high-emission alternatives would also remove the likelihood of effective enforcement. “A standalone global fuel standard with no economic elements would likely merely replicate what already exists in the Carbon Intensity Indicator (CII) mechanism, which requires ships with repeated non-compliance at a certain level to file a corrective action plan,” the report noted. <h3>Geopolitical hurdles ahead for net-zero framework </h3>Eirik Nyhus, director of environment at DNV, has also been looking at possible scenarios that would enable the NZF to be adopted by IMO member states. But he was not convinced that an unchanged measure would make it across the line. “Geopolitics being what they are, there are no reasons to expect the opponents of the NZF to shift their positions or their approach to negotiations by November this year, and therefore repeating the same process with the same proposal under the same circumstances, while hoping for a different outcome is not the best strategy,” Nyhus told a recent online conference. Pushing through the NZF unchanged would require the framework’s supporters to provide diplomatic surety and cover for the countries being pressured by the US. “This is a high-stakes approach, high-risk, and not very likely to succeed, though there may be parties thinking it’s worth a shot again,” Nyhus said. Also presenting a challenge would be the removal of the economic element in a restructuring of the existing proposal with only the technical element put forward. The technical element covers the fuel intensity regulation that mandates progressively lower GHG emissions over time. “The opposition to any economic element, whether deferred or delayed, is going to be so strong that only a purely technical regulation really has any chance of going forward under that scenario,” Nyhus said. “If all relevant alternative fuel options are on the table, [a purely technical measure] could contain incentives for a large cross section of countries around the world, and in theory, this could lead to adoption in November this year,” he added. “But all the stars will need to align, and I think it will be a challenge for that to happen.” Another very real scenario would be flag states representing most of the global tonnage rejecting any proposal that is put forward. The NZF can be blocked if one-third of countries representing over 50% of global tonnage formally object during the adoption process. “In all of these cases, the timeline has really been pushed back significantly,” Nyhus said. “Despite it being theoretically possible to have something in place by November 2028, I think the issues to be solved are so thorny that the IMO will need more time, if an outcome can be negotiated at all. “Entering into force of some version of the regulation in 2029 is optimistic and 2030 is more likely, but I would not be shocked to see things slide even further,” he added. Contact Greg Knowler at <a href="">greg.knowler@spglobal.com</a>. </div>

Decarbonization experts are running through different scenarios that will enable the International Maritime Organization’s delayed net-zero emissions framework to be formally adopted in November. A best-case scenario will see the IMO framework, postponed for a year at a meeting last October , entering into force in 2028, a year later than planned, and coming into effect in 2029. But a prolonged political deadlock could delay regulatory certainty on greenhouse gas (GHG) reductions for several years. The Global Maritime Forum and maritime classification society DNV looked separately at the different scenarios for net-zero implementation. And while the views of their decarbonization experts differed, there was consensus that whatever measure is ultimately agreed to this November, the IMO’s revised emissions reduction targets set in 2023 will need to be pushed back. A new report from the Global Maritime Forum was released this week and looked at the different plausible outcomes for the net-zero framework (NZF). “Uncertainty at the IMO: Three scenarios and their consequences for shipping’s transition,” was co-authored by Tristan Smith, associate professor at the UCL Energy Institute, and Femke Spiegelenberg, project manager of the Getting to Zero Coalition within the Global Maritime Forum. Three potential scenarios were covered by the report: adopting the NZF unchanged from the measures voted down last October, adopting a single-tier fuel standard with lower compliance costs, and removing the economic elements altogether. The report noted that each scenario would have materially different impacts on timelines, enforcement, investment signals, revenues, low-income countries, and regional policies. “At a minimum, the implementation dates in the text will need to be adjusted to reflect the postponed adoption,” the report said. “More fundamentally, the political dynamics that led to the NZF delay introduced new uncertainty not just about the timeline but also about the final shape and ambition of the framework. “At one extreme, the NZF could be adopted ‘as is’ later this year, entering into force in 2028 and coming into effect in 2029,” the report added. “At the other extreme, a prolonged political deadlock could delay regulatory certainty on GHG reductions for several years.” A battle to build consensus The motion to delay adoption of the IMO’s net-zero framework last October was made at a tense and combative session of its Marine Environment Protection Committee (MEPC) in London. Despite 80% approval for the NZF from member states voting last April, 34 countries switched positions between April and October to favor the deferment in the face of growing pressure from the US. The vote to delay was 57 in favor and 49 against, with 21 abstentions. Achieving the IMO target of full decarbonization by or around 2050 with benchmark targets set along the way will require narrowing the wide price gap that exists between fossil fuels and the low- or zero-emission alternatives, which by its very nature will require making fossil fuels more expensive. But the US believes putting a price on carbon emissions from ships will be passed on to its consumers, increasing costs by 10%. That position, centered around President Donald Trump’s view that a price on carbon emissions was a “global green new scam tax on shipping,” triggered extraordinary threats by the White House that included sanctions, port fees and visa refusals against member states voting to adopt the IMO net-zero framework. The IMO is now focused on building consensus around some version of the NZF this year before a reconvened MEPC meets in November to finalize the legally binding measures. With the US so fundamentally opposed to any economic measure that penalizes carbon emissions, one of the potential scenarios being suggested by some member states was to remove it completely from the NZF and focus instead on a technical measure. The Global Maritime Forum report warned that any removal of the economic element that is designed to make green technologies cheaper than high-emission alternatives would also remove the likelihood of effective enforcement. “A standalone global fuel standard with no economic elements would likely merely replicate what already exists in the Carbon Intensity Indicator (CII) mechanism, which requires ships with repeated non-compliance at a certain level to file a corrective action plan,” the report noted. Geopolitical hurdles ahead for net-zero framework Eirik Nyhus, director of environment at DNV, has also been looking at possible scenarios that would enable the NZF to be adopted by IMO member states. But he was not convinced that an unchanged measure would make it across the line. “Geopolitics being what they are, there are no reasons to expect the opponents of the NZF to shift their positions or their approach to negotiations by November this year, and therefore repeating the same process with the same proposal under the same circumstances, while hoping for a different outcome is not the best strategy,” Nyhus told a recent online conference. Pushing through the NZF unchanged would require the framework’s supporters to provide diplomatic surety and cover for the countries being pressured by the US. “This is a high-stakes approach, high-risk, and not very likely to succeed, though there may be parties thinking it’s worth a shot again,” Nyhus said. Also presenting a challenge would be the removal of the economic element in a restructuring of the existing proposal with only the technical element put forward. The technical element covers the fuel intensity regulation that mandates progressively lower GHG emissions over time. “The opposition to any economic element, whether deferred or delayed, is going to be so strong that only a purely technical regulation really has any chance of going forward under that scenario,” Nyhus said. “If all relevant alternative fuel options are on the table, [a purely technical measure] could contain incentives for a large cross section of countries around the world, and in theory, this could lead to adoption in November this year,” he added. “But all the stars will need to align, and I think it will be a challenge for that to happen.” Another very real scenario would be flag states representing most of the global tonnage rejecting any proposal that is put forward. The NZF can be blocked if one-third of countries representing over 50% of global tonnage formally object during the adoption process. “In all of these cases, the timeline has really been pushed back significantly,” Nyhus said. “Despite it being theoretically possible to have something in place by November 2028, I think the issues to be solved are so thorny that the IMO will need more time, if an outcome can be negotiated at all. “Entering into force of some version of the regulation in 2029 is optimistic and 2030 is more likely, but I would not be shocked to see things slide even further,” he added. Contact Greg Knowler at  greg.knowler@spglobal.com . 

No clear path to get IMO’s net-zero framework over the line: industry experts

<div class="phx-topic abstract-wrapper">APMT and TiL will operate the Balboa and Cristobal terminals, respectively, for 18 months while Panama’s government considers how best to award long-term contracts after nullifying the 28-year concession held by CK Hutchison.</div>

APMT and TiL will operate the Balboa and Cristobal terminals, respectively, for 18 months while Panama’s government considers how best to award long-term contracts after nullifying the 28-year concession held by CK Hutchison.

<div class="phx-topic">The terminal subsidiaries of Maersk and Mediterranean Shipping Co. have begun operating the Balboa and Cristobal terminals of the Panama Canal on an interim basis after the Panamanian government late Monday took control of the facilities from the local unit of CK Hutchison Holdings. Maersk’s APM Terminals (AMPT) was given a transitory concession contract for the Balboa terminal on the Pacific side of the canal by the Panama Maritime Authority (PMA); MSC’s Terminal Investment Limited (TiL) was given the same for Cristobal on the Atlantic coast. APMT and TiL will operate the respective terminals for 18 months while Panama’s government considers how best to award long-term contracts. The move to eject CK Hutchison-owned Panama Ports Company (PPC) came just hours after the government published the Panama Supreme Court’s final ruling nullifying PPC’s 28-year concession, which <a href="https://www.joc.com/article/panama-court-voids-ck-hutchison-canal-terminal-leases-6161145">was announced by the court on Jan. 29.</a>PMA officials said the agency decided to award two separate concessions to assess different operating models and improve overall management of the terminals, while the units of Maersk and MSC were chosen because of the cargo volumes the carriers move through the two ports. APM Terminals Panama has paid $26.1 million for its temporary concession, while TiL has paid $15.8 million, according to concession documents. Last month, the PMA indicated that APMT would be awarded the concession for both Balboa and Cristobal. “We have sought out operators who handle the cargo,” Alberto Alemán Zubieta, head of the PMA transition team and former administrator of the Panama Canal, told a press briefing Monday. A Maersk spokesperson in Panama said about 75% of the cargo moving through Balboa originates from Maersk. “The decision to contract an operator associated with the owner of most of that cargo helps stabilize the operation and mitigate the most significant risk during the transition to keeping volumes moving,” the spokesperson said. APMT, meanwhile, said in a customer advisory Tuesday it had initiated a “stabilization phase” at Balboa, but hinted at possible disruption at the terminal as it deploys a new operating system. The company said it is aiming “to safeguard the continuity of Panama’s logistics hub, while a new terminal operating system is deployed and operations are progressively reactivated with the least possible disruption.” It gave no timeframe for the launch of the new system or how long any possible cargo disruption could last. Marliz Bermudez, CEO of APM Terminals Panama, said Tuesday the transition phase at Balboa “requires speed and precision so that the port can progressively resume operations once the system installation is completed, along with other operational, audit, training, and verification tasks.” Maersk said it was “closely monitoring the situation based on information provided by the terminal operator and relevant authorities.” Carriers using both the Balboa and Cristobal terminals, in addition to Maersk and MSC, include Cosco Shipping, CMA CGM, Evergreen, Hapag-Lloyd, and Ocean Network Express. MSC and TiL could not immediately be reached for comment on operations at Cristobal. <h3>More threats from Hutchison </h3>Hong Kong-based Hutchison condemned the takeover of the terminals by the Panamanian government and said the awarding of concessions to APMT and TiL was “unlawful.” A spokesperson for China’s Foreign Ministry said during a press briefing in Beijing on Tuesday that China “will firmly protect the company’s legitimate and lawful rights and interests.” “The takeover of the two terminals reflects the culmination of a campaign by the Panama state against PPC and the concession contract over the past year,” Hutchison said in a statement. Hutchison’s control of the terminals at either end of the Panama Canal had become the focus of a wider geopolitical spat between the US and China over political influence in the region. Hutchison, which shut down its PPC website following the government takeover, has already threatened legal action against APM Terminals and the Panama government. It also warned that the AMPT takeover at Balboa could harm the relationship between Hutchison and Maersk. While the Panama Supreme Court ruling cannot be reversed, Hutchison’s statement said it is continuing to consult with legal advisors over launching national and international legal action against Panama and “third parties colluding with them.” It already launched an international arbitration claim in early February against the government over the loss of the terminal concessions.Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>.</div>

The terminal subsidiaries of Maersk and Mediterranean Shipping Co. have begun operating the Balboa and Cristobal terminals of the Panama Canal on an interim basis after the Panamanian government late Monday took control of the facilities from the local unit of CK Hutchison Holdings. Maersk’s APM Terminals (AMPT) was given a transitory concession contract for the Balboa terminal on the Pacific side of the canal by the Panama Maritime Authority (PMA); MSC’s Terminal Investment Limited (TiL) was given the same for Cristobal on the Atlantic coast. APMT and TiL will operate the respective terminals for 18 months while Panama’s government considers how best to award long-term contracts. The move to eject CK Hutchison-owned Panama Ports Company (PPC) came just hours after the government published the Panama Supreme Court’s final ruling nullifying PPC’s 28-year concession, which was announced by the court on Jan. 29. PMA officials said the agency decided to award two separate concessions to assess different operating models and improve overall management of the terminals, while the units of Maersk and MSC were chosen because of the cargo volumes the carriers move through the two ports. APM Terminals Panama has paid $26.1 million for its temporary concession, while TiL has paid $15.8 million, according to concession documents. Last month, the PMA indicated that APMT would be awarded the concession for both Balboa and Cristobal. “We have sought out operators who handle the cargo,” Alberto Alemán Zubieta, head of the PMA transition team and former administrator of the Panama Canal, told a press briefing Monday. A Maersk spokesperson in Panama said about 75% of the cargo moving through Balboa originates from Maersk. “The decision to contract an operator associated with the owner of most of that cargo helps stabilize the operation and mitigate the most significant risk during the transition to keeping volumes moving,” the spokesperson said. APMT, meanwhile, said in a customer advisory Tuesday it had initiated a “stabilization phase” at Balboa, but hinted at possible disruption at the terminal as it deploys a new operating system. The company said it is aiming “to safeguard the continuity of Panama’s logistics hub, while a new terminal operating system is deployed and operations are progressively reactivated with the least possible disruption.” It gave no timeframe for the launch of the new system or how long any possible cargo disruption could last. Marliz Bermudez, CEO of APM Terminals Panama, said Tuesday the transition phase at Balboa “requires speed and precision so that the port can progressively resume operations once the system installation is completed, along with other operational, audit, training, and verification tasks.” Maersk said it was “closely monitoring the situation based on information provided by the terminal operator and relevant authorities.” Carriers using both the Balboa and Cristobal terminals, in addition to Maersk and MSC, include Cosco Shipping, CMA CGM, Evergreen, Hapag-Lloyd, and Ocean Network Express. MSC and TiL could not immediately be reached for comment on operations at Cristobal. More threats from Hutchison Hong Kong-based Hutchison condemned the takeover of the terminals by the Panamanian government and said the awarding of concessions to APMT and TiL was “unlawful.” A spokesperson for China’s Foreign Ministry said during a press briefing in Beijing on Tuesday that China “will firmly protect the company’s legitimate and lawful rights and interests.” “The takeover of the two terminals reflects the culmination of a campaign by the Panama state against PPC and the concession contract over the past year,” Hutchison said in a statement. Hutchison’s control of the terminals at either end of the Panama Canal had become the focus of a wider geopolitical spat between the US and China over political influence in the region. Hutchison, which shut down its PPC website following the government takeover, has already threatened legal action against APM Terminals and the Panama government. It also warned that the AMPT takeover at Balboa could harm the relationship between Hutchison and Maersk. While the Panama Supreme Court ruling cannot be reversed, Hutchison’s statement said it is continuing to consult with legal advisors over launching national and international legal action against Panama and “third parties colluding with them.” It already launched an international arbitration claim in early February against the government over the loss of the terminal concessions. Contact Keith Wallis at keithwallis@hotmail.com .

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Maersk, MSC units begin interim management of Panama Canal terminals

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