Maersk updates Bunker Adjustment Factor, new Environmental Fuel Fee
- Published
by Admin
Danish business conglomerate Maersk on Wednesday (11 September) updated its Bunker Adjustment Factor (BAF) and introduced a new Environmental Fuel Fee (EFF).
“From 1st January 2020, a new regulation will come into force to reduce air pollution from ships globally,” it stated.
“Whereas today ships can use fuel with up to 3.5% sulphur content (outside Emission Control Areas), the new global sulphur cap will be 0.5%.
“The cost of compliance with the new regulation will be significant, so the cost of shipping will increase.”
Maersk is currently using the fuel price for high-sulphur fuel (3.5% sulphur) to calculate the BAF.
However, from 1 January 2020 the BAF tariff will be calculated based on the fuel price for 0.1% sulphur gasoil with a fixed deduction of 50 USD/ton.
Moving forward, Maersk will introduce an Environmental Fuel Fee (EFF) on all trades, which will apply to all spot business and contracts with validity up to 3 months.
The EFF tariff will be trade-specific and reflect the fuel-related cost increases that result from compliance to the IMO 2020 regulation (calculated as the price difference between high sulphur fuel and low sulphur fuel multiplied by a trade factor).
The EFF tariffs will only be reviewed in case of significant fuel price fluctuations (more than 50 USD/ton). It will be applicable from 1 December 2019 and will be announced end-October 2019.
Photo credit: A. P. Moller – Maersk
Published: 18 September, 2019
