Carriers gaining confidence in low-sulfur fuel negotiations

Container carriers will incur additional costs of as much as $265 per FEU from Asia to the US West Coast and $700 per FEU to the East Coast as a result of the low-sulfur fuel mandate, according to one study. Photo credit: Shutterstock.com.

Container carriers will incur additional costs of as much as $265 per FEU from Asia to the US West Coast and $700 per FEU to the East Coast as a result of the low-sulfur fuel mandate, according to one study. Photo credit: Shutterstock.com.

Container lines are expressing growing optimism that they will be able to fully recoup the higher operating costs caused by a global low-sulfur fuel mandate in annual trans-Pacific service contracts.

That’s a positive sign not just for carriers, but also for shippers, who could see increased blank sailings and even canceled service strings if the container shipping industry is forced to slash capacity because it can’t shoulder the billions in extra annual costs to meet the International Maritime Organization’s (IMO’s) mandate.