Chinese owners seek sulphur cap reprieve amid Covid-19 outbreaks

The China shipowners’ association CSOA has asked the Chinese government to halt for a few months the new 0.50% IMO sulphur cap mandate. CSOA said that to do so would reduce the financial burden being suffered by local shipowners because of the impact of the novel coronavirus outbreak.

CSOA vice-chairman Zhang Shouguo said that the request was also based on a possible shortage of low-sulphur fuel supply because of the impact of the virus.

The group’s more than 200 member companies include Cosco Shipping and China Merchants.

“At this special period, can China make the technical adjustment even just for a few months or be acceptant to the fuel oil non-availability reports?” the group asked in a draft letter.

CSOA noted that several countries, including Greece, the Philippines and Indonesia, had made similar suggestions since the implementation of the 0.50% IMO regulation on January 1st 2020.

When asked by Lloyd’s List whether the relief on burning cheaper traditional bunker fuel would also apply to foreign owners when their ships call in China, Zhang averred, saying only that the details of the matter would be up to the government.

The suspension of the sulphur cap was just one of a series of proposed measures from the CSOA. These included tax cuts, government subsidies and extensions of bank loans.

The CSOA take on the sulphur cap is not unanimous in China. Two researchers at the Shanghai International Shipping Institute, a government-backed think tank, warned that halting the sulphur cap would lead directly to a loss of moral leadership that China had built up in the Low-sulphur Fuel Output supply chain. “If other bunker hubs in Asia establish the supply ability in the next six months, our country’s lack of edge in the marine service industry will continue”, the think tank said.

Mr Zhang said that his association was still in consultation with members but aimed to submit a formal copy this week.