Wan Hai Lines Ltd (萬海航運) is not equipping its vessels with scrubbers, but would use fuel oil with low sulfur content to meet new regulations set by the International Maritime Organization, the company said on Monday.
“We have considered many factors [when making this decision]. We are aware of the higher price of low-sulfur fuel, but still thought that using the cleaner fuel would work better for us,” Wan Hai spokeswoman Laura Su (蘇麗梅) said by telephone.
The company’s clients have accepted the increased fees caused by low-sulfur fuel, Su said.
The company’s strategy would differentiate it from local peers, such as Evergreen Marine Corp (長榮海運) and Yang Ming Marine Transport Corp (陽明海運), she added.
Under the rules, shippers either need to use fuels containing only 0.5 percent sulfur, or install scrubbers that can clean higher-sulfur fuel to reduce emissions.
Fifty-three of Evergreen’s 139 vessels had been equipped with scrubbers as of the end of last year, company data showed.
Yang Ming plans to equip five of its container ships with scrubbers by May and another 29 ships later this year.
Evergreen and Yang Ming have said that installing scrubbers would be more economical, given that the price spread between high-sulfur and low-sulfur fuel is estimated to be about US$250 per tonne.
Wan Hai, which makes 70 percent of its revenue on intra-Asia routes, uses smaller vessels than its two peers. None of the company’s vessels is larger than 10,000 twenty-foot equivalent units, data showed.
Taipei-based Wan Hai said its business remained stable last quarter, with revenue rising 1.5 percent annually to NT$18.8 billion (US$626.7 million).
For the whole of last year, revenue rose 9.24 percent annually to NT$72.95 billion, the company said.
The company’s business outlook remains unclear this quarter, Su said, adding that the timing of orders by Chinese clients after the Lunar New Year holiday would give some clues.
Evergreen, which saw revenue slow down in the third quarter of last year due to lower spot rates on major routes, reported that revenue last quarter declined 2.42 percent annually to NT$47.58 billion.
Cumulative revenue totaled NT$190 billion last year, up 12.41 percent year-on-year, Evergreen said.
Yang Ming’s revenue last quarter fell 6.33 percent annually to NT$35.99 billion, while cumulative revenue for last year rose 5.27 percent annually to NT$149 billion.
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