Ship part

MSI warns of possible spike in shipbreaking from 2024

Maritime Strategies International (MSI), a research and forecasting consultancy, has launched a new tool to help shipowners and operators assess vessel performance against regulatory and market benchmarks.

The company’s new Environmental Credentials app has been integrated into its Forecast Marine eValuator (FMV) service and will assess the impact of EEXI and CII, as far as is known at this time. CII ratings will become increasingly stringent between 2026 and 2030, but carbon reductions are not yet quantified.

However, MSI’s findings on the dry bulk fleet research undertaken earlier this year are concerning. The consultancy found that nearly 80% of bulk carriers will not meet EEXI regulations and most will need to adopt engine power limitation (EPL) measures to comply with the requirements.

The Capesize fleet will be particularly affected, given that many ships in this segment were built between 2006 and 2011, before EEDI led to more efficient ship designs from 2013. The EPL is a relatively cheap and convenient to reduce emissions per ton-mile, but, some say, has drawbacks. A reduction in the overall speed of the dry bulk fleet by, for example, 1-2 knots would mean a reduction in capacity of 8-15%.

The new environmental baseline assessments can be performed for individual vessels, sectors, vessel classes and entire fleets, MSI said. The assessments will compare vessel performance against IMO EEXI and CII regulations up to 2026, as well as past vessel performance, assessing annual efficiency rates for 2020 and 2021 against the principles trajectory of Poseidon and a goal of zero emissions by 2050.

MSI Director Will Fray commented, “Older ships requiring a large EPL to meet EEXI criteria would have the least flexibility in their operations, reducing their potential for acceleration to meet laycan windows when they face delays such as those caused by bad weather. Ultimately, this would lead to lower freight volume and reduced potential freight revenue, thereby reducing the economic life of a vessel.

“A significant number of 10 to 15 year old vessels are at risk and over the next five years will age in a bracket much more likely to be scrapped, particularly if freight markets decline from current levels, such as MSI expects it.”