Shipper ZIM bets on LNG as transitional fuel

: Fertilizers, Natural gas, Oil products
23/07/14

Israel-based container shipping company ZIM is embracing LNG as a transitional fuel to reduce its greenhouse gas (GHG) emissions.

LNG is the only fuel currently available on a large scale to the shipping sector that immediately provides emissions reduction, the company said in its sustainability report. ZIM considers LNG to be a transitional solution to fuels such as bio-LNG (biological), e-LNG (synthetic), ammonia and methanol "when they become available". Five of the company vessels have ammonia-ready tanks that could be retrofitted for ammonia operation when ammonia becomes a feasible option. The company is also considering a biofuel pilot test.

In 2022, ZIM signed a 10-year marine LNG purchase agreement with Shell. The company chartered the newbuild LNG-powered 15,000 twenty-foot equivalent unit (TEU) container ship ZIM Sammy Ofer in February. It will charter another 27 newbuild LNG-fuelled container ships: 19 15,000 TEU vessels and 18 7,700 TEU vessels. These will replace older, lower fuel efficiency vessels. By next year, about 30pc of its fleet capacity will be LNG-fuelled, which is expected to reduce ZIM's carbon footprint by 25pc.

Last week, the International Maritime Organisation (IMO) adopted a revised GHG emissions strategy. IMO members agreed to reduce GHG emissions by at least 20pc, and preferably 30pc, by 2030; by at least 70pc, and preferably 80pc, by 2040; and to net zero by 2050 from 2008 base levels. ZIM is aiming for net zero emissions by 2050.

The company did not quantify its 2022 marine fuel consumption. Its latest data from 2021 showed that the company burned 1.33mn metric tonnes (t) of residual fuel oil and 115,251t of marine gasoil.

By Stefka Wechsler

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25/04/11

Fujairah biofuel uptake lags despite EU rules push

Dubai, 11 April (Argus) — Alternative bunker fuels like biofuels have yet to gain significant traction in the UAE port of Fujairah, the world's third-largest bunkering hub, even though EU regulations such as FuelEU Maritime and the EU Emissions Trading System (ETS) are driving demand expectations. Discussions at the S&P Global Commodity Insights FUJCON 2025 this week highlighted a combination of structural and market-driven factors holding back adoption, with limited demand from key vessel types and insufficient infrastructure investment topping the list. The introduction of FuelEU Maritime, which mandates a 2pc reduction in greenhouse gas (GHG) intensity for ships calling at EU ports starting this year, alongside the EU ETS carbon pricing mechanism was expected to spur demand for biofuels in Fujairah. Many vessels refueling in the UAE hub transit to Europe, making compliance with these regulations a potential driver for alternative fuel uptake. A key reason cited is the limited presence of containerships and cruise ships in Fujairah's bunkering market. Globally, these vessel types are the primary consumers of biofuels due to their operators' commitments to decarbonisation and customer-driven sustainability demands. Fujairah's bunkering activity is dominated by bulk carriers and tankers, which have been slower to adopt alternative fuels. "Containerships and cruise ships are leading the charge on biofuels in Singapore and Rotterdam, but they are just not a big part of the mix here," said Fujairah harbour master Mayed Alameeri. "We support the use of green fuels, but without that demand pull, there's little incentive to scale up." This lack of demand has deterred investments in biofuel storage and supply infrastructure. Unlike in Singapore and Rotterdam, where biofuel bunkering is supported by dedicated facilities, Fujairah's infrastructure remains geared toward conventional fuels. "There is no single shipowner who has partnered with a supplier in Fujairah on adoption of alternative fuels," said Hafnia Bunker general manager Kasper Sorensen. "It is very difficult to make a business case for investment." While there have been sporadic inquiries from shipowners over the past year, these have been for small amounts — typically 150-200t — far below the scale needed to spur investment. "You need steady offtake to justify the capex for tanks and blending," a Fujairah supplier said. "Right now, we're not seeing it." Market dynamics also play a role. The price spread between biofuels and conventional fuels remains a hurdle, with Fujairah's B24 blend trading at a significant premium to very low sulphur fuel oil (VLSFO). Mandates need certainty The bunker market is under pressure to decarbonise as the International Maritime Organisation (IMO) targets a 50pc cut in shipping emissions by 2050 from 2008 levels. Alternative fuels are central to this goal, but regulatory disparities complicate investment decisions, industry players said. Regulatory uncertainty adds another layer of caution. While FuelEU's pooling mechanism allows shipowners to offset emissions across fleets, potentially enabling biofuel bunkering in Fujairah to count toward EU compliance, clarity on implementation is limited. Bunker market participants urged the adoption of universal standards for alternative bunker fuels, warning that fragmented regulations are hampering the shift to lower-carbon options. "Shipowners are still figuring out how to navigate these rules which are regionally divergent," said a shipping broker. "Until there's more certainty, many are sticking with what they know." Still, some market participants expressed cautious optimism. Rising inquiries, although sporadic, suggest growing awareness of biofuels' role in meeting EU mandates. "It's not a flood, but it's a trickle that could build," said a bunker trader. For now, Fujairah's biofuel market remains in a holding pattern, waiting for demand signals strong enough to shift the hub's bunkering landscape. By Elshan Aliyev Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

South Korean bitumen exports may head to southeast Asia

25/04/11

South Korean bitumen exports may head to southeast Asia

Singapore, 11 April (Argus) — South Korea bitumen exports could start entering southeast Asia in the coming months, following the recent opening of the arbitrage window between the two regions. Export prices from South Korea have declined sharply over the past week, weighed down by early-week declines in upstream crude and high-sulphur fuel oil values. A Yeosu-based refiner concluded an export tender to sell up to four May- and June-loading cargoes on 10 April, which was settled in the range of $375-385/t fob South Korea, according to market participants. Declines in fob Singapore bitumen export pricing have been slower in comparison, as continued production output cuts contributed to curtailed spot supplies. Most refiners in Singapore have fully committed April- and May-loading volumes, although several traders were still holding on to unsold volumes. In contrast, a steady supply of April- and May-loading cargoes has been made available from South Korean suppliers over the past month. One refiner previously released three export tenders in March alone, far more than the typical one per month. Arbitrage economics to export bitumen from South Korea to southeast Asia has grown more favourable, as fob Singapore premiums over that of fob South Korea values widened. Spreads between fob Singapore and South Korea widened to $42.50/t on 10 April, up from $22.50/t a week earlier. This is the widest since November 2024, when fob Singapore prices also traded at premiums of $42.50/t to that of South Korean exports. Traders who won some shipments from the recent South Korean export tender may direct some of these volumes to southeast Asia, rather than sell them to the traditional export destination market of east China. Domestic prices in east China have come under renewed pressure in the week to 11 April, undermined by consecutive day-on-day losses in the bitumen futures market. This, coupled with a weaker yuan against the US dollar, has put a dent on Chinese appetite for South Korean exports. These South Korean exports could eventually be shipped to Vietnam, where demand has been relatively more robust compared with other Asian countries, market participants said. Pricing competition in north Vietnam has intensified in 2025 on increased export supplies from south China. And with South Korean exports likely to join the fray, this could temporarily edge out Vietnam's imports of Singapore-origin bitumen. By Leanne Tan Singapore vs South Korea bitumen price spreads ($/t) Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Malaysia sets new haulier limits at Port Klang

25/04/11

Malaysia sets new haulier limits at Port Klang

Singapore, 11 April (Argus) — The Association of Malaysian Hauliers (AMH) — under the transport ministry's directive — hasset operational weight limitson hauliers operating at port Klang effective from 1 May, possibly raising logistical costs for some fertilizer importers. The majority of haulier equipment used at port Klang has a maximum capacity of 38,000kg (38t), and the AMH has set a verified gross mass (VGM) weight limit of 25,000kg (25t). This results in trailers of 20ft and 40ft having a VGM limit of 25,000kg (25t), while side loaders will be imposed a VGM limit of 22,000kg (22t). These new weight limits could increase logistical costs for fertilizer importers, especially those using side loader hauliers, according to one fertilizer importer. Importers could previously load around 24-25t of product, but imposing a weight limit would mean that importers using side loader hauliers must pay for more containers for the same cargo size. Importers typically use side-load hauliers if they are importing large volumes of product, as it is more efficient. But this new regulation is unlikely to affect urea fertilizers as the typical volume for a urea cargo is usually around 21t, the importer said. The limits would more likely impact the loadings of fertilizers like phosphates, NPKs and potash. One NPK producer indicated that this could raise their import costs for incoming cargoes at port Klang by around 10pc. Some Malaysian importers have also indicated that they only ship cargoes in 25t containers and they would not be affected, as the policy is only limited to port Klang and 24t containers. Others have filed complaints to the port Klang authorities and are expecting to receive more feedback next week. By Dinise Chng Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Tariff concerns drive US VLSFO to 4-year lows

25/04/10

Tariff concerns drive US VLSFO to 4-year lows

New York, 10 April (Argus) — Very low-sulphur fuel oil (VLSFO) monthly averages at four US ports have declined to their lowest levels since 2021, driven by uncertainty surrounding US tariffs. Houston and New Orleans VLSFO monthly averages dropped to $470/t and $491/t, respectively, so far in April. That is the lowest average for Houston since April 2021 and the lowest since February 2021 for New Orleans. New York and Philadelphia VLSFO averages are at $498/t and $510/t, respectively, the lowest since April 2021 for New York and May 2021 for Philadelphia. Bunker market participants have had mixed reactions to the price decline so far. According to one trader, some buyers have been trying to buy bunker fuel with delivery dates for one month from now, to lock in the lower prices, rather than one week out, which is typical when buying bunker fuel in the spot market. Another market contact said they have seen a mixture of elevated buying interest but also some buyers who will hold off waiting to see if prices continue to drop or if the volatility in prices ease as there have been large price swings within the same business day. "I have not seen anything this volatile since the start of the Russia vs Ukraine war," the trader said. Oil futures went up by almost 5pc on 9 April reversing losses from early that morning after US president Donald Trump paused higher punitive tariffs against key trading partners such as the EU and Japan and increased tariffs against China. The wild swing for intraday bunker prices on 9 April , which typically traces Brent crude, lowered market demand. By Luis Gronda Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

New tariffs could upend US tallow imports: Correction

25/04/10

New tariffs could upend US tallow imports: Correction

Corrects description of options for avoiding feedstock tariffs in 12th paragraph. Story originally published 3 April. New York, 10 April (Argus) — New US tariffs on nearly all foreign products could deter further imports of beef tallow, a fast-rising biofuel feedstock and food ingredient that had until now largely evaded President Donald Trump's efforts to reshape global trade. Tallow was the most used feedstock for US biomass-based diesel production in January for the first month ever, with consumption by pound rising month to month despite sharp declines in actual biorefining and in use of competing feedstocks. The beef byproduct benefits from US policies, including a new federal tax credit known as "45Z", that offer greater subsidies to fuel derived from waste than fuel derived from first-generation crops. Much of that tallow is sourced domestically, but the US also imported more than 880,000t of tallow last year, up 29pc from just two years earlier. The majority of those imports last year came from Brazil, which until now has faced a small 0.43¢/kg (19.5¢/lb) tariff, and from Australia, which was exempt from any tallow-specific tariffs under a free trade agreement with US. But starting on 5 April, both countries will be subject to at least the new 10pc charge on foreign imports. There are some carveouts from tariffs for certain energy products, but animal fats are not included. Some other major suppliers — like Argentina, Uruguay, and New Zealand — will soon have new tariffs in place too, although tallow from Canada is for now unaffected because it is covered by the US-Mexico-Canada free trade agreement. Brazil tallow shipments to the US totaled around 300,000t in 2024, marking an all-time high, but tallow shipments during the fourth quarter of 2024 fell under the 2023 levels as uncertainty about future tax policy slowed buying interest. Feedstock demand in general in the US has remained muted to start this year because of poor biofuel production margins, and that has extended to global tallow flows. Tallow suppliers in Brazil for instance were already experiencing decreased interest from US producers before tariffs. Brazil tallow prices for export last closed at $1,080/t on 28 March, rising about 4pc year-to-date amid support from the 45Z guidance and aid from Brazil's growing biodiesel industry, which is paying a hefty premium for tallow compared to exports. While the large majority of Brazilian tallow exports end up in the US, Australian suppliers have more flexibility and could send more volume to Singapore instead if tariffs deter US buyers. Export prices out of Australia peaked this year at $1,185/t on 4 March but have since trended lower to last close at $1,050/t on 1 April. In general, market participants say international tallow suppliers would have to drop offers to keep trade flows intact. Other policy shifts affect flows Even as US farm groups clamored for more muscular foreign feedstock limits over much of the last year, tallow had until now largely dodged any significant restrictions. Recent US guidance around 45Z treats all tallow, whether produced in the US or shipped long distances to reach the US, the same. Other foreign feedstocks were treated more harshly, with the same guidance providing no pathway at all for road fuels from foreign used cooking oil and also pinning the carbon intensity of canola oil — largely from Canada — as generally too high to claim any subsidy. But tariffs on major suppliers of tallow to the US, and the threat of additional charges if countries retaliate, could give refiners pause. Demand could rise for domestic animal fats or alternatively for domestic vegetable oils that can also be refined into fuel, especially if retaliatory tariffs cut off global markets for US farm products like soybean oil. There is also risk if Republicans in the Trump administration or Congress reshape rules around 45Z to penalize foreign feedstocks. At the same time, a minimum 10pc charge for tallow outside North America is a more manageable price to pay compared to other feedstocks — including a far-greater collection of charges on Chinese used cooking oil. And if the US sets biofuel blend mandates as high as some oil and farm groups are pushing , strong demand could leave producers with little choice but to continue importing at least some feedstock from abroad to continue making fuel. Not all US renewable diesel producers will be equally impacted by tariffs either. Some tariffs are eligible for drawbacks, meaning that producers could potentially recover tariffs they paid on feedstocks for fuel that is ultimately exported. And multiple biofuel producers are located in foreign-trade zones, a US program that works similarly to the duty drawbacks, and have applied for permission to avoid some tariffs on imported feedstocks for fuel eventually shipped abroad. Jurisdictions like the EU and UK, where sustainable aviation fuel mandates took effect this year, are attractive destinations. And there is still strong demand from the US food sector, with edible tallow prices in Chicago up 18pc so far this year. Trump allies, including his top health official, have pushed tallow as an alternative to seed oils. By Cole Martin and Jamuna Gautam Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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