Fleet and Fuel Factors – Fleet Capacity has to Increase

“Scrapping activity is extremely low due to high vessel utilisation and no current incentive to remove vessels from the fleet. We do expect this to change with the fleet getting even older and the impact of GHG regulations. However, scrapping levels are still expected to be weak compared to the overall fleet size of old vessels.”

At present, a number of older and smaller vessels will be exempt from the IMO’s new GHG emission regulations (CII and EEXI) – “at least that is the current picture, which might change in a couple of years”. But to reach the fleet capacity required, “not only will the current orderbook need to be delivered, but new orders will need to happen. Based on demand and day rate levels we forecast for this period, we expect further newbuild orders in the 2025-26 period.”

Pasztor said it was difficult to figure out the effects of the new regulations on the MPV market: “The big uncertainty keeps people on their toes. For smaller vessels, it seems they would be exempt from the regulations, so it will be interesting to see if larger cargoes shift from larger vessels. But will these smaller vessels really be exempt, or will they end up with the same rules?”

Future Fuels Availability
In the discussions and decisions around future marine fuels, the issues for MPVs may be the same as for the other shipping sectors but there are further complications, said Pasztor. “It is not an issue with vessel designs and technical/technological capabilities of the vessels; it is about the availability of these new green bunkers.

“On top of that, there is a further complicating factor – the ports the MPVs use are not the same as the main ports being used by container ships. So, from a bunkering perspective, I think the challenges will be even higher, to be able to get these green fuels at the right location. Maybe for those people who operate their vessels on a particular schedule between, let’s say, larger ports, it might be a smaller issue.”

In general it is going to be a real challenge for many operators trying to adhere to green fuels, especially in places where they have to deliver some large equipment to more out-of-the-way places, he explained.