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IMO 2020: Are You Ready for the Impact?



Change can be a difficult time for many organizations, but equipping yourself with as much information as possible will help you weather the coming storms. The International Maritime Organization (IMO) 2020 sulfur cap changes are poised to impact the world of maritime shipping in the coming year, but are you prepared for them?

Are You Ready for IMO 2020?

IMO 2020 sulfur emissions caps are set to begin on January 1, 2020. These changes will require ship owners to adjust their fuel consumption habits to remain in compliance with the new regulations. Vessel owners have three main options for adapting to these changes: switching their vessels to low-sulfur fuel oil (LSFO), equipping their ships with scrubbers known as Exhaust Gas Cleaning Systems (EGCS) which allow the use of high-sulfur fuel oil (HSFO) while preventing excessive sulfur exhaust emissions, or leveraging alternative clean fuels like liquefied natural gas (LNG).


The upcoming IMO 2020 changes have already caused a shift in fuel prices and availability as LSFO prices spiked in recent months to over $500 per ton. HSFO, while purchasable at a roughly 50 percent discount to compliant fuels, is currently seeing a drop in availability as port storage operators have begun shifting their inventories and cleaning out tanks of HSFO to make room for cleaner-burning fuel options.


Understanding these changes can help you choose the best shipping partners going forward as you learn how the vessel owners are adapting to IMO 2020. Regardless of the direction ship owners choose, shipping costs are likely to increase in response to the IMO 2020 sulfur cap at least for the time being. While IMO 2020 is likely to increase shipping costs in the near-term, these changes will also result in a positive environmental impact that is worth the added cost.


For more information or help with any of your shipping needs, contact us today and get in touch with our logistics and brokerage experts!

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